How I Setup My Daily Trades
TL;DR: Fib + Harmonics for entries and exits.
Good morning satoshi snipers!
I posted the above video already on YouTube / Twitter but, per usual, I want to give you a bit more detail on how this shapes out and what I usually do to prepare for a “typical” day of trading bitcoin.
Ultimately I want to create a “roadmap” of price action for the day and then setup my (limit) bids / asks / stop loss / take profit(s) and then I can literally just sit around, watch Netflix, play iOS games (I need some more suggestions) and wait for my orders to fill and enjoy the gains.
The video is as comprehensive as it really comes but I’ll break it down for you in very clear, simple steps:
Step 1 — Setting the Time Frame
I determine the timeframe that I’m going to trade that day. Usually this doesn’t change but there are days where I may feel like I want to really set / forget some larger swings for whatever reason and so I should always make sure I’ve got not just the right timeframe but also mentality — the shorter / smaller tfs (1min / 5min / 15min) will require a bit more babysitting while the larger / longer tfs (4hr / 8hr / 1day / 1week).
It’s really up to you. But, if it’s the latter you really have to sit back and weight as sometimes these things can take 30 to 60 bars to print; if you’re on the 1 day that’s 2 months of time!
Step 2 — Fibonacci Retracement Tool
I use the Fibonacci Retracement Tool via TradingView is my starting guide as I take a look at the last major (local) high or pivot point and connect it to the swing low or lowest pivot in a given time range.
You can choose which levels you want to see and be represented but the key ranges that I use are as-follows:
Also, the very-important .618 is considered to be the “golden pocket” where most retracement occurs; a very good thing to know about entries and exits!
The Fibonacci levels give you precision guidance as you “hunt” for active / printing harmonic patterns (learn more about those in the Trading Library) and when they align with the levels you’ve set up — as you can clearly see them being printed and being tested — you’ve got some strong confluence for either an entry or an exit.
Based on other factors — most especially volume — and my confidence I could either setup all my trades for the day and lightly-babysit them, adjusting entry points and profits as I track the the market’s movements.
Now, all you have to do is the right orders and you’re good:
For me, as some of you already know, I like quick and heavily-loaded “bags” to make my ends — snipes (or scalps) are my specialty and I love getting in and out of a position in just a few minutes with a few thousand bucks with my name on it.
I may spend 30 minutes to an hour setting these things up, hunting for harmonics that I like and that I usually trade against — it’s worth noting that I don’t trade many of the harmonics, only the ones that I really, really like and that have had historical success with. I have also outlined the larger context as well in the Trading Library, but provided it here again:
Identify harmonic patterns, find confluence with (ideally) 2-3 sequences.
Are we in accumulation or distribution phase in the trading timeframe? Are there obvious “darvas” zones or support and/or resistance? Is there a Wyckoff forming?
Is RSI trending in the right direction? Is volume declining in preparation for a big larger (and more profitable) move?
How is the general sentiment in the larger market? What is the DXY and other industry indexes doing (image above)? What are the social media “influencers” peddling and how scared are participants in the market? Are there any major industry / financial events happening (e.g. FOMC)?
Determine trade size, entry point (PRZ — “Price Reversal Zone”), stop loss, and profit targets. Enter order (with all those details) and then wait for order to fill! Hopefully it works and we’re in profit!
Then, you go for it! The White Swan / Black Swan harmonics are some of my absolute favorite to trade because I know how they usually behave and can quickly “spot” issues with the printing in near-real-time. I can also trade them 3-4 times through each print, up and down as she cycles through price action and against the fibonacci levels.
This is why it’s about “time in the market” and not “timing the market”; the more you can experience trading the more you’ll know what you’re doing and what you’re reading.
Good luck and happy hunting!
To infinity & bitcoin