TRADING

GUIDE

NEVER LOSE A TRADE AGAIN

This trading guide based on personal

experience (making and losing money)
and all the techniques are using by
@planfomo personally every single day.

BY @PLANFOMO
2022
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 FEW WORDS FROM
THE AUTHOR
I created this ebook as a guide for myself so I could use
it every day, because the market, charts, and patterns
look different every time I open my laptop.

This guide helps me stay on track and gives me more

confidence. If you remember those days when you were
in school and tried to cheat during exams. This is
exactly the same thing.

To be more specific, I was able to manage quite well my

trading strategy and build my trading account from
$1000 to over $354,900. Now I'm sharing it with you.
Yes, you! I mean... why not? I believe we have to help
each other to grow and to make money.

So stay focused and learn, because if I could make you -

you can make it as well, 1000%!

In this trading guide, I'm going straight to the point with

every explanation simple and easy to understand.

Enjoy!
 CONTENTS
WHY TRADE CRYPTOCURRENCY?
WHAT IS THE DIFFERENCE BETWEEN CRYPTO, &
FOREX TRADING?
WHAT IS THE BLOCKCHAIN?
IS THE VOLATILITY OF BITCOIN GOOD OR BAD FOR
TRADING?
WHAT IS A BULL MARKET OR BEAR MARKET?
HOW TO READ CRYPTO CHARTS?
TRADING PSYCHOLOGY
UNDERSTAND PRICE MOVEMENT
TRADING PATTERNS
TRENDS VS PATTERNS
HAVE YOU EVER HEARD ABOUT "RETESTING"?
THE ANATOMY OF TRADING BREAKOUTS
WHAT IS A BREAKOUT?
TRADING SUPPORT AND RESISTANCE
HOW TO TAKE PROFITS?
TOP INDICATORS
HOW TO TRADE FIBONACCI RETRACEMENT IN
CRYPTO?
CRYPTO, STOCKS & FOREX TRADING
PLATFORMS/EXCHANGES
 WHAT IS THE DIFFERENCE
BETWEEN CRYPTO & FOREX?
Deciding to trade forex or cryptocurrencies depends
largely on a few important factors, including risk versus
reward tolerance, a willingness to speculate, and
knowledge of how to trade both since neither is easy for
beginners.

Forex is generally considered safer than cryptocurrency

trading since the latter is more prone to wider market
swings given that there is no central regulatory body
and there is far less liquidity.

FOREX CRYPTO
Regulated Deregulated
Highly liquid Less liquidity
More stability Higher volatility
Fewer extreme price Greater chance for
swings being scammed.
Better for less risky Steeper learning
traders curve
Good for day traders More tradable assets
Good for day traders
 WHAT ARE THE MAIN
DIFFERENCES BETWEEN
FOREX & CRYPTO?

Despite currencies and cryptocurrencies being

fundamentally very different they both still rely on
supply and demand to determine prices.

Forex trading is the buying and selling of currency pairs

in a monitored market that is open 24/7 hours.

Cryptocurrency trading is the buying and selling of

digital assets, such as coins, tokens, and non-fungible
tokens (known as NFTs) in both centralized and
decentralized markets with very little regulation.

Foreign currencies are accepted as legal tender around

the world, despite some restrictions in countries, while
to date there are a number of nations and companies
that accept cryptocurrencies for day-to-day financial
and purchasing transactions, though this is starting to
change as cryptocurrencies become more mainstream.
 WHY TRADE
CRYPTOCURRENCY?

Start with $100

With crypto still very much in its infancy, you don’t need
a lot of money to make it big! A small investment of just
$100 could be worth $1000s by the same time next
year, provided that you take the time to learn and
choose the right investments. Small initial investment
lowers both the risk and the barrier of entry, for the
benefit of a larger potential gain than any other market.

More Volatility
If you’re investing in stocks, a 5% price change can send
the market into a frenzy! However, with
cryptocurrencies, it’s common to see a 50% price
increase overnight - giving you the potential to profit big
with just 1 trade! Keep in mind, the increased volatility.
The Crypto Market Never Sleeps
Unlike stocks, the cryptocurrency market never closes!
This means wherever you are in the world, you can earn
a second income by trading in your spare time; all from
the comfort of your bed! What’s not to love?

Leverage Trading
After you’ve got a bit of experience, you can try your
hand at leveraged trading. This lets you earn up to 100x
more than you usually would, meaning a trade that
would’ve only netted you $5, could earn you $500.
Keep in mind - risks increase because leverage also
amplifies your losses.

Profit In Both Directions

You might think a coin has to rise in value to make
money, well this isn’t the case. Regardless of a coin’s
performance, you can continue earning by opening up a
short position This enables you to profit from both rising
and falling prices. You’re moments away from learning
how to do it!
 WHAT IS THE
BLOCKCHAIN?

On the surface Blockchain technology seems

impossible to understand, with any definition typically
accompanied by a load of jargon. However, if we take a
step back and look at Blockchain technology in simple
terms, it becomes far easier to grasp.

The Blockchain is a database that gets distributed to

every computer on the network, instead of connecting
to a central server. This is advantageous because it
makes the Blockchain near-impossible to take down.
The database contains the data from every transaction
that takes place on a network, every time a new
transaction occurs it gets added to the database.

These lists of transactions are separated into

manageable “blocks”, which each contain a transaction
timestamp and a link to the previous block. Because
each block has to be validated by every computer on
the network, it makes it impossible to falsify a
transaction, resulting in a tamper-proof ledger
containing every transaction to ever takes place.
 IS THE VOLATILITY OF
BITCOIN GOOD OR
BAD FOR TRADING?
While it’s true Bitcoin is becoming more and more
accepted as a form of currency, the market is still
fiercely volatile. Of course, this isn’t ideal for Bitcoins
use case as a store of value (although as you can see
from the graphic above, the price is only increasing) but
for traders, a bit of volatility can be the perfect storm.

Picture for second two traders - one trades

cryptocurrency and the other Forex. The person trading
cryptocurrency is subject to extreme volatility but
because of this doesn't need to have much capital and
doesn’t need to use leverage. On the other hand,
because prices only change by a fraction of a penny,
the person trading Forex needs to use far greater
leverage or requires a huge amount of capital. While
neither person is wrong, the person trading
cryptocurrency has the potential to see a far greater
return on investment.
 WHAT IS A BULL
MARKET OR BEAR
MARKET?
A bull market describes the constant rising of a crypto
market. Per definition, the market generally increases by
at least 20%.

A bear market describes the constant fall of a crypto

market. Per definition, the market generally decreases
by at least 20%.
 HOW TO READ
CRYPTO CHARTS?
Identifying trends, whether they are moving up, down or
across, and also knowing when they are about to
reverse is really key to your Crypto trading. No matter
what asset you are trading, you need to know how to
follow charts.

Candlestick charts are used by traders to determine

possible price movement based on past patterns.
Candlesticks are useful when trading as they show four
price points (open, close, high, and low) throughout the
period of time the trader specifies.

One of the most important things you need to learn

before delving deeper into the world of cryptocurrency
trading is how to read a candlestick chart. When
compared to a line chart or something similar, a
candlestick chart provides you with a much clearer
insight into how the market is performing, making it a
key tool in any trader's arsenal.

If you take a look at the image below, we can see it

highlights the differences between a bearish and
bullish candle and shows you how to successfully
interpret candlestick movements.
 TRADING
PSYCHOLOGY
Trading psychology is the emotional component of an
investor's decision-making process which may help
explain why some decisions appear more rational than
others. Trading psychology is characterized primarily by
the influence of both greed and fear. Greed drives
decisions that appear to be too risky.
 UNDERSTAND PRICE
MOVEMENT

Patterns are separated into bullish and bearish. Bullish

patterns indicate that the price is likely to rise, while
bearish patterns indicate that the price is likely to fall
and candlestick patterns help us to understand in which
direction we're going.

There are 35 Types of Candlestick Patterns. They can

be divided into: Continuation Patterns, Bullish Reversal
Patterns & Bearish Reversal Patterns

The next page will show you how many are, how to
understand them, and how to recognize them.
 REVERSAL PATTERNS

CONTINUATION PATTERNS
 TOP TRADING
PATTERNS

BULLISH PATTERNS BEARISH PATTERNS

 HOW THEY WORK?
As a trader, to make the best decisions, you must
understand how trading patterns work. These trading
patterns play important roles in technical analysis. By
knowing them, the chances are that you will make
accurate trading decisions at all times.

For the best trading results, you must understand

various trading patterns and how they work. If you know
the patterns and what they mean, you will not invest
your money blindly, and by doing that, there will be
increased chances of making profits. The patterns
mentioned above are just some of them, but they offer a
good starting point toward understanding the
psychology behind trading patterns. The best way to
learn is by consistently practicing and being open-
minded.

Down below I drew the best-performing patterns that

helped me to make the most profit.

ALWAYS LOOK FOR A TRIANGLE!!!

ASCENDING TRIANGLE
(72.77% WIN RATE)
The ascending triangle is a bullish continuation pattern
that signifies the continuation of an uptrend. Ascending
triangles can be drawn onto charts by placing a
horizontal line along the swing highs – the resistance –
and then drawing an ascending trend line along the
swing lows – the support.

Ascending triangles often have two or more identical

peak highs which allow for the horizontal line to be
drawn. The trend line signifies the overall uptrend of the
pattern, while the horizontal line indicates the historic
level of resistance for that particular asset.
 EXAMPLE:

ASCENDING TRIANGLE (LONG)

ASCENDING TRIANGLE (SHORT)

 DESCENDING
TRIANGLE
(72.93% WIN RATE)
Descending triangles generally shift lower and break
through the support because they are indicative of a
market dominated by sellers, meaning that
successively lower peaks are likely to be prevalent and
unlikely to reverse.

Descending triangles can be identified from a

horizontal line of support and a downward-sloping line
of resistance. Eventually, the trend will break through
the support and the downtrend will continue.
 EXAMPLE:

DESCENDING TRIANGLE (LONG)

DESCENDING TRIANGLE (SHORT)

 SYMMETRICAL
TRIANGLE
There is no win or loss rate in my book of symmetrical
triangles because it can go both ways.

The symmetrical triangle pattern can be either bullish or

bearish, depending on the market. In either case, it is
normally a continuation pattern, which means the
market will usually continue in the same direction as the
overall trend once the pattern has formed.

Symmetrical triangles form when the price converges

with a series of lower peaks and higher troughs. In the
example below, the overall trend is bearish, but the
symmetrical triangle shows us that there has been a
brief period of upward reversals.
 EXAMPLE:

SYMMETRICAL TRIANGLE (LONG)

SYMMETRICAL TRIANGLE (SHORT)

 FALLING & RISING
WEDGES
Wedges form as an asset’s price movements tighten
between two sloping trend lines. There are two types of
wedge: rising and falling.

A rising wedge is represented by a trend line caught

between two upwardly slanted lines of support and
resistance. In this case, the line of support is steeper
than the resistance line. This pattern generally signals
that an asset’s price will eventually decline more
permanently – which is demonstrated when it breaks
through the support level.

A falling wedge occurs between two downwardly

sloping levels. In this case, the line of resistance is
steeper than the support. A falling wedge is usually
indicative that an asset’s price will rise and break
through the level of resistance, as shown in the example
below.
Both rising and falling wedges are reversal patterns,
with rising wedges representing a bearish market and
falling wedges being more typical of a bullish market.
 EXAMPLE:

RISIGN WEDGE (SHORT)

FALLING WEDGE (LONG)

 HEAD & SHOULDERS
PATTERN (83.44% WIN RATE)

Head and shoulders is a chart pattern in which a large

peak has a slightly smaller peak on either side of it.
Traders look at head and shoulders patterns to predict a
bullish-to-bearish reversal.

The head and shoulders patterns are statistically the

most accurate of the price action patterns, reaching
their projected target almost 85% of the time. The
regular head and shoulders pattern is defined by two
swing highs (the shoulders) with a higher high (the head)
between them. The inverted head and shoulders pattern
has two swing lows with a lower low between them. The
two outer swing highs/lows don't have to be at the same
price, but the closer they are to the same area the
stronger the pattern generally becomes.
 EXAMPLE:

HEAD & SHOULDERS (SHORT)

INVERSE HEAD & SHOULDERS (LONG)

 DOUBLE TOP & DOUBLE BOTTOM
PATTERNS (76-79% WIN RATE)

A double top is another pattern that traders use to

highlight trend reversals. Typically, an asset’s price will
experience a peak, before retracing back to a level of
support. It will then climb up once more before
reversing back more permanently against the prevailing
trend.

A double bottom chart pattern indicates a period of

selling, causing an asset’s price to drop below a level of
support. It will then rise to a level of resistance, before
dropping again. Finally, the trend will reverse and begin
an upward motion as the market becomes more bullish.

A double bottom is a bullish reversal pattern, because

it signifies the end of a downtrend and a shift towards an
uptrend.

Everything about double top & double bottom works

perfect for a triple top and triple bottom if the price hits
those levels again without shaking the market structure.
Also triple bottom & triple top gives your a bigger % for
a successful trade and gives you more confirmation.
 EXAMPLE:

DOUBLE TOP (SHORT)

DOUBLE BOTTOM (LONG)

 ASCENDING & DESCENDING
CHANNELS (73% WIN RATE)

The channel price pattern is a fairly common sight in

trending moves that have good volume and acts as a
delayed continuation pattern. Note that the channel
pattern is similar to the flag in that they both have
periods of consolidation between parallel trendlines,
but the channel pattern is generally wider and consists
of many more bars which increases its strength and
success rate.

The ascending channel pattern is defined by a bullish

trending move followed by a series of lower highs and
lower lows, that form parallel trendlines containing the
price. The descending channel pattern is defined by a
bearish trending move followed by a series of higher
lows and higher highs, that form parallel trendlines that
contain price.

This pattern is complete when the price breaks through

the upper trendline in an ascending channel or below
the lower trendline in a descending channel pattern. The
pattern is considered successful when the price has
achieved a movement from the outer edge of the
pattern equal to the distance of the initial trending move
that started the channel pattern.
EXAMPLE (MY PERSONAL TRADES):

DESCENDING CHANNEL (SHORT)

ASCENDING CHANNEL (LONG)

 BULLISH & BEARISH PENNANT
PATTERNS, FLAGS
(54.87%-55.19%)

Although we've already covered the best price action

patterns, I thought it would be useful to include one
more pattern because of its comparatively poor
performance despite being commonly used. The
pennant pattern is one that you often see right next to
the bull and bear flag pattern in the textbooks, but
rarely does anyone talk about its low success rate.
While the flag itself isn't an exceptional pattern at just
under a 70% success rate, the pennants come in well
below that.

Like the flag, the pennant often occurs in high

momentum markets after a strong trending move, but
the tight price formation that occurs can lead to
breakouts against the preceding trend almost as often
as we get a continuation. The slight difference in the
price pattern formation between flags and pennants is
an important distinction that can make a big difference
in your trading results so it's well worth being aware of
while watching the market develop during your trading
day.
EXAMPLE:

BULLISH PENNANT (LONG)

BEARISH PENNANT (SHORT)

 TRADING SUPPORT &
RESISTANCE PATTERNS

BULLISH PATTERN

BEARISH PATTERN
 BULLISH & BEARISH RECTANGLE
PATTERNS (78-80% SUCCESS RATE)

The rectangle price pattern is a continuation pattern

that follows a trending move. It is very similar to the
channel pattern, except that the pattern does not have a
slope against the preceding trend which gives it a higher
chance of successful continuation.

The rectangle pattern is defined by a strong trending

move followed by two or more nearly equal tops and
bottoms that create two parallel horizontal trendlines
(support and resistance). The only difference between
the bullish and bearish variations is that the bullish
rectangle pattern starts after a bullish trending move,
and the bearish rectangle pattern starts after a bearish
trending move.

It's worth noting that these rectangle price patterns are

essentially failed double and triple tops/bottoms.
Because the swing points following the double and
triple highs or lows don't break to confirm the patterns,
those reversals are not confirmed. This is why it can be
very dangerous to try to anticipate double and triple
tops/bottoms because often they don't fully complete
and price will resume the prior trend.

The rectangle pattern is complete when price breaks

the resistance line in a bullish rectangle, or when price
breaks the support line in a bearish rectangle. The
pattern is considered successful when price extends
beyond the breakout point by the same distance as the
width of the rectangle pattern.
 EXAMPLE:

BEARISH RECTANGLE (SHORT)

BULLISH RECTANGLE (LONG)

SCALPING PATTERN BY PATTERN
TRENDS VS PATTERNS

BULLISH PATTERN

BEARISH PATTERN
 TRENDS
In technical analysis, trends are identified by trendlines
or price action that highlight when the price is making
higher swing highs and higher swing lows for an uptrend,
or lower swing lows and lower swing highs for a
downtrend. The three basic types of trends are up,
down, and sideways.

An uptrend is marked by an overall increase in price.

Nothing moves straight up for long, so there will always
be oscillations, but the overall direction needs to be
higher.

A downtrend occurs when the price of an asset moves

lower over a period of time. While the price may move
intermittently higher or lower, downtrends are
characterized by lower peaks and lower troughs over
time.

Trends may be discovered in the short, medium, and

long term. Generally, investors take positions in assets
that will be profitable as long as the current trend
continues. Taking positions that profit only if a trend
reverses is riskier. Analysts use trendlines and
channels, which are essentially boundaries for price
fluctuations, in an attempt to spot and define trends.
Upward trends are characterized by an asset price
hitting a series of higher highs and higher lows, while
downward trends are marked by lower highs and lower
lows. Most traders trade in the direction of the trend.
Traders who go opposite the trend are called contrarian
investors.
 PATTERNS
A pattern is a series of data that repeats in a
recognizable way. It can be identified in the history of
the asset being evaluated or other assets with similar
characteristics. Patterns often include the study of sale
volume, as well as price. Patterns can occur within a
downward or upward trend, or they can mark the
beginning of a new trend.

Patterns are the distinctive formations created by the

movements of security prices on a chart. A pattern is
identified by a line that connects common price points,
such as closing prices or highs or lows, during a specific
period of time. Chartists seek to identify patterns as a
way to anticipate the future direction of a security’s
price.

There are bottoming, topping, and continuation

patterns. A "follow-through day" pattern is an example of
a pattern used by some analysts to identify market
bottoms. The "head-and-shoulders" topping pattern is
popular among day and swing traders, while
continuation patterns include the "cup-and-handle," "flat
base," and "three weeks tight."

"The trend is your friend" is a common catchphrase

among technical analysts. A trend can often be found by
establishing a line chart. A trendline is a line formed
between a high and a low. If that line is going up, the
trend is up. If the trendline is sloping downward, the
trend is down. Trendlines are the foundation for most
chart patterns.
 HAVE YOU EVER HEARD ABOUT
"RETESTING"?

Allow the Stock, Crypto asset to Retest: This is the

most critical step. When a stock price breaks a
resistance level, old resistance becomes new support.
When a stock breaks a support level, old support
becomes new resistance.

THE ANATOMY OF TRADING

BREAKOUTS

Breakout trading is used by active investors to take a

position within a trend's early stages. Generally
speaking, this strategy can be the starting point for
major price moves, and expansions in volatility and,
when managed properly, can offer limited downside
risk. Throughout this article, we'll walk you through the
anatomy of this trade and offer a few ideas to better
manage this trading style.

Breakout trading welcomes volatility. The volatility

experienced after a breakout is likely to generate
emotion because prices are moving quickly. Using the
steps covered in this article will help you define a
trading plan that, when executed properly, can offer
great returns and manageable risk.
 A breakout is a potential trading opportunity that
occurs when an asset's price moves above a
resistance level or moves below a support level on
increasing volume.
The first step in trading breakouts is to identify
current price trend patterns along with support and
resistance levels in order to plan possible entry and
exit points.
Once you've acted on a breakout strategy, know
when to cut your losses and re-assess the situation
if the breakout sputters.
As with any technical trading strategy, don't let
emotions get the better of you. Stick with your plan
and know when to get in and get out.

WHAT IS A BREAKOUT?
A breakout is a stock price moving outside a defined
support or resistance level with increased volume. A
breakout trader enters a long position after the stock
price breaks above resistance or enters a short position
after the stock breaks below support. Once the stock
trades beyond the price barrier, volatility tends to
increase and prices usually trend in the breakout's
direction. The reason breakouts are such an important
trading strategy is because these setups are the
starting point for future volatility increases, large price
swings and, in many circumstances, major price trends.

Breakouts occur in all types of market environments.

Typically, the most explosive price movements are a
result of channel breakouts and price pattern breakouts
such as triangles, flags, or head and shoulders patterns.
As volatility contracts during these time frames, it will
typically expand after prices move beyond the identified
ranges.
EXAMPLE (EUR/USD TRADE):

Regardless of the timeframe, breakout trading is a great

strategy. Whether you use intraday, daily, or weekly
charts, the concepts are universal. You can apply this
strategy to day trading, swing trading, or any style of
trading.

FINDING A GOOD CANDIDATE

When trading breakouts, it is important to consider the

underlying stock's support and resistance levels. The
more times a stock price has touched these areas, the
more valid these levels are and the more important they
become. At the same time, the longer these support and
resistance levels have been in play, the better the
outcome when the stock price finally breaks out.
EXAMPLE (2X EUR/USD TRADES):

As prices consolidate, various price patterns will occur

on the price chart. Formations such as channels,
triangles, and flags are valuable vehicles when looking
for stocks to trade. Aside from patterns, consistency
and the length of time a stock price has adhered to its
support or resistance levels are important factors to
consider when finding a good candidate to trade.
SMART WAY TO
TAKE PROFITS
STEP 1

STEP 2

STEP 3
STEP 1
Entering the pattern that I know and I'm confident
with.
After the price breaks out my pattern most of the
time I'm waiting for a retest, because sometimes we
can receive a fakeout that can trigger our stop/loss
or for those that are not using stop/loss, and with big
leverage they can get liquidated.
After price action confirms (retest) that we exited
our pattern and formed another trend - I'm
confidently entering my position. In this case, as an
example, I'm shorting the market.

STEP 2
Entering my position by using stop/loss. Always use
your stop/loss. In my case, I'm always risking 1-2% of
losing. Of course, you can decide by yourself how
much money you willing to lose and open your
position with bigger stop/losses (like 2-5%) if you are
super confident that the price gonna go down.

STEP 3
Ok, so let's imagine now that our trade is going well
and we started to see a "green" profit in our position
and you thinking to take it right now. WRONG! You
should never take your profits as long as your
position didn't reach a % of a win than your stop/loss
percentage, because in the long run if you will use
this technique over and over again, you will lose
more than you make.
In my case, if I'm risking only 1% to lose - I'm always
waiting for my position to reach 1-2% profits and
then start securing it because we never know how
far we can go and how much we can make from one
trade.
 THE TOP INDICATORS
THAT HELPS ME TO
PREDICT PRICE ACTION
 ICHIMUCU CLOUD

The Ichimoku Cloud is a collection of technical

indicators that show support and resistance levels, as
well as momentum and trend direction. It does this by
taking multiple averages and plotting them on a chart. It
also uses these figures to compute a “cloud” that
attempts to forecast where the price may find support
or resistance in the future.

The overall trend is up when the price is above the

cloud, down when the price is below the cloud, and
trendless or transitioning when the price is in the cloud.

Traders will often use the Ichimoku Cloud as an area of

support and resistance depending on the relative
location of the price. The cloud provides
support/resistance levels that can be projected into the
future. This sets the Ichimoku Cloud apart from many
other technical indicators that only provide support and
resistance levels for the current date and time.
 SQUEEZE MOMENTUM

Squeeze Momentum shows periods when volatility

increases or decreases, in other words, when the
market goes from the trend into flat movement and vice
versa. The market consolidates 80% of the time and
only 20% of the time it moves in a certain direction. It
works for any time frame.

The indicator was created by John Carter to show the

market volatility. It shows the periods when volatility
increases or decreases, in other words, when the
market goes from the trend into flat movement and vice
versa. The Yellow crosses on the midline show that the
market just entered a squeeze, thus signifying low
volatility. The market is preparing itself for an explosive
move (up or down). The Gray crosses signify the
opposite, a “Squeeze release”. It is suggested to wait
till the first gray after a yellow cross, and taking a
position in the direction of the momentum (for ex., if the
momentum value is above zero, go long) and exit the
position when the momentum changes (increase or
decrease — signified by a color change).
 MACD

The Moving Average Convergence Divergence (MACD)

oscillator is a technical gauge that can help traders to
identify emerging price trends, be they bullish or
bearish.

Classed as a momentum indicator, the MACD is based

on the relationship between two moving price averages
on the same asset. Conceived by investment manager
Gerald Appel in 1979, the MACD has risen to become
one of the most popular technical trading indicators in
use today.

When the MACD rises above the signal line, traders

view this as bullish and tend to go long on the asset in
anticipation of upward momentum.

In contrast, the MACD falling below the signal line is a

bearish prompt that traders may act upon to take short
positions in the asset as they seek to profit from price
falls.
RSI Indicator + Technique
(Relative Strength Index)
Overboughts

Oversold

The Relative Strength Index (RSI), developed by J.

Welles Wilder, is a momentum oscillator that measures
the speed and change of price movements. The RSI
oscillates between zero and 100. Traditionally the RSI is
considered overbought when above 70 and oversold
when below 30. Signals can be generated by looking for
divergences and failure swings. RSI can also be used to
identify the general trend.

RSI is considered overbought when above 70 and

oversold when below 30. These traditional levels can
also be adjusted if necessary to better fit the security.
For example, if a security is repeatedly reaching the
overbought level of 70 you may want to adjust this level
to 80.

Note: During strong trends, the RSI may remain in

overbought or oversold for extended periods.
RSI also often forms chart patterns that may not show
on the underlying price chart, such as double tops and
bottoms and trend lines. Also, look for support or
resistance on the RSI.

In an uptrend or bull market, the RSI tends to remain in

the 40 to 90 range with the 40-50 zone acting as
support. During a downtrend or bear market the RSI
tends to stay between the 10 to 60 range with the 50-60
zone acting as resistance. These ranges will vary
depending on the RSI settings and the strength of the
security’s or market’s underlying trend.

If underlying prices make a new high or low that isn't

confirmed by the RSI, this divergence can signal a price
reversal. If the RSI makes a lower high and then follows
with a downside move below a previous low, a Top
Swing Failure has occurred. If the RSI makes a higher
low and then follows with an upside move above a
previous high, a Bottom Swing Failure has occurred.

RSI Diverging
from Price
 VRVP Indicator
(Volume Profile Visible Range)

The volume profile is an advanced charting Indicator

that is available on a Tradingview Pro subscription. It
displays trading activity over a specified period and
plots a histogram on the chart which reveals dominant
and significant price levels based on volume and in
essence gives a clear indication of Supply or demand at
a certain price rather than volume in a certain period.

The Resistance and Support levels can be provided by

the Volume profile using a reactive method so they
constantly change with price action and give a more
clear picture to predict future price movements. The
Reactive method relies on past price movements at
certain price levels and applies a more significant
understanding of price reaction at certain meaningful
levels.

Support levels will be areas where price will be

supported on the way down.
Resistance levels will be areas that resist price on the
way up.

A basic understanding of this is that Buyers will enter

the market at the bottom of a profile and sellers will
enter the market at the top of the profile.
 CM SupperGuppy
200 EM
A

In short, it’s many EMA’s (Exponential Moving Average)

bundled up into one indicator.

The CM Super Guppy is comprised of 7 Fast EMA’s and

15 Slow EMA’s. These are just names used to
differentiate their use cases which we are going to
elaborate on later...

Super Guppy also provides you with an ‘overall

average’ → the EMA 200. The main use of EMA 200 is
to indicate MASSIVE support/resistance.

The SuperGuppy illustrates, beautifully, the ‘fluidity’ of

the price movement. This is especially very important in
any kind of trading on any timeframe, you must have a
tool that illustrates how much the price is squeezed,
loose or out of bounds.

If you’re a beginner or a trading master, you must have

heard that price action acts like water, the markets love
moving in waves → Up…Down…Up…Down…

“Be as water, my friend.” — Bruce Lee

 INTERESTED IN
FIBONACCI
RETRACEMENT
TRADING TECHNIQUE?
 HOW TO TRADE FIBONACCI
RETRACEMENT IN CRYPTO?

What Is Fibonacci Retracement?

To understand what is a Fibonacci retracement, we first

need to introduce you to the Fibonacci numbers
sequence. The Fibonacci retracement meaning is
derived from the following series of numbers: 0, 1, 1, 2,
3, 5, 8, 13, 21, 34, 55, etc. Here, each number is the sum
of the two previous ones.

To have the Fibonacci retracement explained, we can

divide each number by the next one and obtain a ratio of
68.1%. When we divide it by the number two places to
the right, we obtain 38.2%. Finally, the next ratio equates
to 23.6%.

In the 12th century, Leonardo Pisano (better known as

Fibonacci), noticed that this sequence is widespread
across nature. It can be naturally found in spiral shapes
that form seashells, constellations, flowers, etc. More
importantly, it is believed that Fibonacci retracement
also affects how humans behave. In our narrative, it
applies to how the prices can fluctuate in the crypto
market.

To achieve this, traders choose Fibonacci swing high

swing low price points on the chart.
The aforementioned ratios of 68.1%, 38.2%, and 23.6%
form horizontal lines between these points, with two
additional levels, at 50% and 76.4%. These crypto
Fibonacci lines provide price levels where the price is
likely to reverse within the trend. They also provide
levels where the price is more likely to stall and
encounter support or resistance.

The two additional levels of 50% and 76.4% are added

by traders, even though they aren’t provided by the
Fibonacci formula. This is because, historically, price
trends tend to find support and resistance at these
levels as well. Consequently, adding them to the
Fibonacci levels on your chart can provide further
insight for market entries or exits.

But is Fibonacci retracement accurate and should you

rely on swing high swing low Fibonacci in crypto
trading? To answer this question, let’s first explain how
to use the Fibonacci retracement in practice.
How To Use a Fibonacci Retracement Tool?

To learn how to use the Fibonacci retracement tool, you

need to understand how to read the lines provided by
the aforementioned Fibonacci crypto ratios.

Using Fibonacci retracement is appealing because there

are no set rules on how to properly use Fibonacci
retracement. You just need to select two points, one
high and one low. Any point that seems relevant to you
in a price trend can be used as a reference. In the
Bitcoin example below, we selected the yearly high and
the yearly low as points of reference for the 1-week
chart.

What’s more, there’s no best time frame for Fibonacci

retracement. This is because Fibonacci retracement
trading can be used on both short and long trading
intervals. That said, crypto Fibonacci retracements on
longer timeframes will present stronger trend indicators
than those on shorter timeframes.
And if you are asking yourself: "does Fibonacci
retracement work?", the answer is yes. What’s
interesting is that one of the main reasons why
Fibonacci retracement work is the indicator’s popularity.
Traders watch the same support and resistance lines
and expect the same result, which culminates in self-
fulfilling predictions.

However, finding the right occasion when to use

Fibonacci retracement is a matter of trading experience.
Fibonacci retracement crypto may seem obvious in
hindsight but placing confident trades in relation to
these levels can be mind-boggling. So, let’s explore
how to read Fibonacci retracement next.

How To Read Fibonacci Retracement?

In trading apps like TradingView, the most common

ratios of Fibonacci in crypto will be represented on a
scale of 1 to 0 with the following levels in between:
0.786, 0.618, 0.5, 0.382, and 0.236. Once you
understand these Fibonacci numbers trading lines, you
can learn how to use Fibonacci retracement levels quite
effortlessly.

It’s worth noting that the 0.618 ratio is particularly

important for trading with Fibonacci retracements. It is
called the “golden ratio” and traders often consider it
as a major trend support/resistance level. When the
price reaches one of these levels, we expect that either
a trend continuation or reversal will occur.
How To Trade With Fibonacci Retracement?

Now that you know how to read Fibonacci retracement

in a chart, let’s continue by showing you how to trade
with Fibonacci retracement. The best way to trade
Fibonacci retracement is by observing the retracement
levels closely.

In the following example, we have a Bitcoin chart in a

downtrend. To know where to use Fibonacci
retracement, choose the highest and lowest points in
this trend. In this instance, the chosen time frame for
Fibonacci retracement is 1 day.

The price reaching below 0.382 ($51,463) could be a

signal that the downtrend continues. Thus, the price
might sharply fall towards 0.236, signaling traders to
place short bets.
Once the price reaches the 0.236 line ($47,296), the
trader can safely close the short position with an ~8%
gain.

This is just a crude example on how to trade with

Fibonacci retracements. We will expand further upon
how to trade Fibonacci retracement further down in our
article. But first, you need to learn how to add Fibonacci
retracement level using TradingView free Fibonacci
retracement tool.

How To Set Up and Draw Fibonacci

Retracement Levels? Exemplified By Crypto
Assets

If you are still wondering how to place Fibonacci

retracement you are in for a treat. Drawing Fibonacci
retracement levels is completely streamlined in
TradingView app/program (it's FREE). Selecting a
relevant high and low price should be your starting
point, depending on the timeframe that you are trading
on.

So, let’s carry on with our guide on how to draw a

Fibonacci retracement using GoodCrypto. First, open
the app and put it in fullscreen mode for legibility
purposes when reading Fibonacci levels crypto.
Once in fullscreen, you can proceed to draw your
Fibonacci retracement by using the integrated Fibonacci
retracement lines tool. To access this Fibonacci
retracement charting tool, activate the drawing tools by
clicking on the icon with a square and a cross in the
middle.

Next, to chart Fibonacci retracement levels, expand the

Gann and Fibonacci retracement tool crypto. Click on
the 3rd tool icon from the top and select the “Fib
retracement” tool. Alternatively, you can use the Alt+F
shortcut to activate the Fibonacci retracement levels
indicator if you are using our web app.
Your next step on how to place a Fibonacci retracement
is to choose a high and low point on your chart. In our
case, we will select the Bitcoin all-time high of $69,000.
Our low point reference will be the low levels of
September 2021 and January 2022 at $39,470. Simply
click and drag from the all-time high to the lowest points
to draw theFibonacci retracement table.

This will allow you to place the most common Fibonacci

retracement levels, including the extremely popular 50
Fibonacci retracement level.
While this level isn’t obtained by calculating the ratios
as we explained earlier in the article, setting a Fibonacci
retracement level at the 0.5 level can be very useful. It
often acts as a strong support/resistance within the
trend and you should use this Fibonacci retracement
level liberally.

And if you use Tradingview for charting, note that the

Trading View Fibonacci retracement operates exactly in
the same manner.

Fibonacci Сalculator: How To Calculate

Fibonacci Retracement?

To calculate the Fibonacci retracement levels, you can

either use a Fibonacci retracement calculator or use the
following Fibonacci retracement formulas:

Uptrend Fibonacci retracement numbers = High price

– ((High price – Low price) * percentage).

Downtrend retracement = Low price + ((High price –

Low price) * percentage).

Thankfully, you will never need to learn how to calculate

Fibonacci retracement as our auto Fibonacci
retracement indicator in the GoodCrypto app will
automatically set the default ratios and levels for you.
Moreover, the following Omnicalculator link will lead
you to a Fibonacci retracement levels calculator that
will do the hard work in your stead.

Now that we have the method on how to calculate

Fibonacci retracement, let’s delve into some practical
examples of Fibonacci pattern crypto trading.
Fibonacci Trading Strategies With Crypto
Examples

Finally, we get to the meat of our article, where we

teach you about Fibonacci trading strategy. Below, we
go through various Fibonacci retracement trading
strategies that you can use as your Fibonacci day
trading strategies for making reliable market entries and
exits. Keep in mind that there’s no single best Fibonacci
trading strategy, as each one can be applied in different
circumstances.

Fibonacci Retracement vs Extension Trading

Strategies: Use Cases

While we already covered Fibonacci retracement

strategy earlier, we haven’t yet touched upon the
Fibonacci retracement vs extension notion. Fibonacci
extensions are very useful for determining exit positions
when the price breaks out of the trend, beyond 100%. To
obtain the ratios for Fibonacci extension vs
retracement, we simply add the usual ratios to 100%,
which gives us 1.236, 1.382, 1.5, 1.618, and so forth.

Let’s have a look at a Fibonacci extension and

retracement example to see how it can help you
determine price targets in a downtrend. In the chart
below, we placed our Fibonacci bottom level at a major
support line on $3,600 for ETH/USD.
The Fibonacci extensions provide us price targets in
case the price breaks down this support line. In this
case, the trader can open short positions once the trend
has broken down the support with targets at 1.236
($3,260) and 1.382 ($3,100). In this particular case, the
1.382 level acted as a strong support from the price,
validating the Fibonacci extensions theory. In case of a
bounce from these levels, the trader can buy back
assets and make profits from the price swing towards
the previous Fibonacci retracement level.

Downtrend and Uptrend Fibonacci

Retracement Trading Strategy

As mentioned earlier, when trading downtrend or

uptrend Fibonacci retracement, the levels will provide
you with crucial support and resistance levels. However,
to draw the Fibonacci retracement in uptrend, you will
need to attach the tool to the bottom and drag it up to
the top. Conversely, when drawing the Fibonacci
retracement on downtrend, attach the tool to the top
and drag it to the bottom of the trend.
In the MATIC/USD example above, we drew Fibonacci
retracement uptrend lines from the bottom up. In case
the price breaks above the 0.382 level ($2.4), it signals
a long position and a continuation of the trend. The
target is the next Fib level at 0.236 ($2.6) providing a
Fibonacci retracement take profit position of 9%. You
can set a stop loss just under the 0.382 level (-1.5%), in
case the breakout is not confirmed.

The same can be applied with a downtrend Fibonacci

retracement, providing you with precise opportunities
for short positions and buybacks.

Fibonacci Support and Resistance Trading

Strategy: Use Cases

The Fibonacci support and resistance lines are

extremely useful when you can’t clearly distinguish
support and resistance lines on a chart. This can help
you immensely with market entries and exits, even
though the price seems to be going in only one direction
on a macro scale.
In the ADA/BTC chart above, the chart is in price
discovery, as no clear support has been formed by the
candles. However, by using Fibonacci with support and
resistance levels, we can predict that there could be
potential support for the price on the 0.236 line
(0.0000348 BTC). The trader can use this to either short
ADA on the breakdown, or buy back on the bounce from
the support.

Fibonacci Sequence Trading Strategy: What Is

It Used For?

Because Fibonacci provides fixed lines for support and

resistance, you can use Fibonacci sequence
tradingautomation strategies. The Fibonacci sequence
in trading can provide you with clear market entries and
exits so that you can set up conditions for automatic
orders using our GoodCrypto app. The Fibonacci
sequence in cryptowill allow you to look for pullbacks
and breakouts for low-risk profit strategies.
In the example above, you can see how the Fibonacci
sequence Bitcoin chart, where it allows you to take
profits from price swings. Breakouts provide buy
signals, where the target is the next Fibonacci
retracement level. On the other hand, breaking down
from Fibonacci sequence levels provides either short
entries, or allows you to place stop losses in case of a
fakeout.

Fibonacci Retracement Golden Pocket

Strategy: Use Cases

The Fibonacci retracement golden pocket level is

another interesting strategy to have in your technical
analysis toolset. The golden pocket is the level
between the 0.618 Fibonacci retracement golden ratio
and the 0.65 ratio. This zone is the level where the price
is most likely to reverse during an uptrend or a
downtrend.
In the above example, (ETH/BTC) the golden pocket
acted as a strong support zone for a bullish reversal
from a 0.5 Fib retracement. In the example below,
however, it acted as a support level in the downtrend.
Once broken downwards, the golden pocket became a
new resistance zone.
DECIDE IF FIBONACCI
RETRACEMENT
TRADING IS FOR YOU
 WHERE TO TRADE
STOCKS & FOREX?

Interactive Brokers
Interactive Brokers offers rock-bottom share prices that
facilitate the investment practices of experienced Forex
traders.

Saxo Bank
Although Saxo Bank necessitates $2,000 or more in
upfront account funding; experienced traders can find
leverage with 60,000+ symbols.

You’ll also have the ability to buy, sell, or trade BTC,

ETH, LTC, and Ripple in fractional increments.

Retail investors who wish to hold their positions over the

long-term can explore 300+ futures from 28 global
exchanges or hedge their bets with 4,500+ corporate
bonds that account for 21 foreign currencies.

IG - Best Forex broker for trading

CFDs
Although you’ll have to pay a 5% commission fee for the
privilege; IG lists short-term and long-term CFDs across
17,000+ financial markets

Established in 1974, IG was founded as the first

legitimate spread betting firm. Since then, they’ve
acquired nearly 200,000 clients and have grown to list
CFDs across tens of thousands of financial markets.
 WHERE TO TRADE CRYPTO?

ByBit
Bybit is a top-rated margin platform for trading
cryptocurrency with leverage due to its seamless user
experience. Traders can long or short coins like Bitcoin,
Ethereum, EOS and XRP with up to 100x leverage. The
mobile app is by far one of the best on the market with
its highly intuitive navigation and charting. The popular
platform offers 4 main markets to trade which include a
spot exchange, inverse perpetual, USDT perpetual and
inverse futures.

FTX
Led by CEO Sam Bankman-Fried, the team behind FTX
has built a professional derivatives and leveraged
products exchange that is designed for professional
trading firms, intermediate traders and beginners alike.
Ranked 3rd in the world based on margin trading
volumes that exceed 21 Billion every 24 hours, FTX is
our best-rated crypto exchange for margin traders in
several countries outside the USA including India, UK,
Australia and Singapore.

FTX is known for creating the world’s first

cryptocurrency index futures that allow its users to
capitalize on the rise or fall of a particular index in the
form of a futures contract. Index futures can be traded
directly from within the FTX exchange platform.
Binance Futures
Binance is the largest digital currency exchange service
in the world that provides a platform for trading
cryptocurrencies. The platform has seen a meteoric rise
since being founded in 2017 and has launched Binance
Futures which specializes in margin, derivatives and
futures trading.

Binance supports one the highest number of trading

pairs with 90 contracts including USDT and Coin-
margined assets to speculate on. At the time of writing,
Binance Futures has a recorded margin trading volume
of over 100 Billion within the last 24-hour period and 20
Billion in open interests.
 WHERE TO HOLD MY COINS?

Coinbase
Among the most popular exchanges, Coinbase is
trusted by millions of users all over the world, including
beginners. Users like that it’s easy to use — to buy, sell
or store currency. You can buy bitcoin, Ethereum and
Litecoin; its digital wallet runs on Android or iOS.

If you prefer, you may choose to trade directly with

other users on Coinbase’s GDAX platform, which stands
for Global Digital Asset Exchange, and there aren’t any
fees to move funds between Coinbase and GDAX. It’s
secure. GDAX is meant for technical traders. Don’t use it
for buying and holding.

Poloniex
Poloniex is what some would call the “Mall of America”
of cryptocurrency. It’s been around since 2014 and is
today considered among the world’s leaders. Setting up
an account in a cakewalk. It has more than 100 currency
pairings, so it can feel like trying to get a sip of water
from a firehose because of the sheer amount of info
available. Expert traders will love the analytic tools —
and the volume, which is substantial.

Fees are reasonable, but should you always know what

the freight charge is coming and going. Reviews say the
customer service is lousy.
Cex.io
Cex.io is a professional-grade site for users who know
what they are doing — the trading dashboards are very
good. Margin accounts available. Security is strong, and
CEX even accepts credit cards. While it has a lot of
bells and whistles, this is a site that newcomers can feel
comfortable with, even if all they want to do is buy and
hold. Coins may be kept in the cloud or in cold-storage
wallets. The data here is dependable and complete, and
CEX has a lot of altcoin choices, though bitcoin is still
the biggie.

The mobile version has been reviewed favorably, and

the exchange rates are good. The one gripe some have
is that the verification process is onerous, but the flip
side to that, of course, is greater security and less
concern over bad actors getting in. A word to the wise:
Keep an eye on fees. All of them, all the time.

Kraken
Kraken is a massive and reputable bitcoin exchange,
with significant volume in euros, yen, dollars, Canadian
dollars and the British pound, which opens up some
fascinating arbitrage opportunities for sophisticated
traders. Kraken also lets you invest in or trade in a ton of
altcoin, among them Ether, Ripple, Monero, Ethereum
Classic, Litecoin, Dogecoin and Zcash.
Margin accounts are available — though these are not
recommended for anyone without significant trading
experience. Kraken is feature-rich like a Bloomberg
terminal and about as intuitive to use, which is to say not
very. This is an excellent site to investigate when you
have mastered the basics on a site like Coinbase.
 THANKS FOR
READING!

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