I hope all will be good so, lets start this is my homework post in steemit crypto academy. And i am very thankful to Mr @abdu.navi03 dor spending his time for make a good lecture for us. Now i am prepared my home work post for our respected prof and in this post we are discuss about the "Crypto Trading Strategy with Median Indicator" for this assignment i used Trading. View Let's start go to own my topic.
01. - Explain your understanding with the median indicator.
Here as you know, in the crypto trading world the trders seek to find the direction of the market up or down trends befor they can take entry or position in the crypto market. Rhe Median Indicator are happen to be a trend as indicator. it's means that the indicator are is help to show direction of a crypto market. with the help of this in place, the traders find its even more and more easier to trafe using indicators as it give information about the current trend of the market.
And the median indicator comprise of ATR Indicator that are forms as a channel with the median line in it's middle. And the ATR channel see above and below it. Median indicator is also used to measure the amount of volatility in the crypto market at any time. the median indicator is compared to an EMA of the same value and the difference btw their value from a cloud which in turn to signifies whether the said trend is bullish or bearish in its nature.
Now you can also read in the upper paragraphs the clouds (Green or Purple) is the form as a result of difference btw the median indicator and the EMA. when the clouds which is the formed is green color, then it's means that the trend is bullish and will be moving in an upward direction and it is also an the entry for buy can be taken. And same as if the clouds is form in purple color then it's means the trend is bearish and it will beove in the downward direction and also an entry for sell can be take. so, we see the clouds color , there must be a crossing of the median line above or below of same length.
When the Median Indicator line is cross above the EMA then the cloud will become green and giving out a single that the the trend has reverse from the bearish trend to bullish trend and buy entey can be take at this point. Now same as , when the median line cross below to the EMA, the cloud will become below from the EMA, the cloud will become purple color and giving out a signal that's in which the trend has reverse from bullish to bearish trend and also sell entry can be take.
02. - Parameters and Calculations of Median Indicator. (Screenshot Required)
To find the parameter of the median indicator, many platforms have median indicator. I will use tradingview.com for the display of the parameter of the indicator. Before starting follow the given instructions,
For visiting the official website of tradingview click on the Trading. View .
Select the chart menu and click on it.
In the given chart, you can select the different pair of assets such as BTC/USDT.
- On the display, you can see the indicator menu, click on it, a search dialog box will appear and you type median in the given search bar which appears on the screen.
click on the indicator who shows in the search bar, and it will be show on screen.
After completion of the given process. you can see the indicator on the chart. you should need to change the setting of the indicator, you can change setting by the selecting a button who appear on the name of the indicator at the left corner of the chart, see picture below
The setting Will be changed by the trader to suit his/her trading strategy. but the best setting for the best entry and exit point is the default setting because it is work effectively for the very fast time.
Screenshots
The Median Indicator calculation has the median value and EMA value. For that reason, we will see at the calculation of both the median value and EMA value before we combine it to calculate with the median indicator.
Median Value is equal to : (Highest Price + Lowest Price) / 2
EMA Value is equal to : (Closing x multiplayer+ [EMA (previous day)] x 1 - Multiplier)
Then,
Median Indicator= ATR % change (Media and EMA Value)
If EMA % change> = Median value, Purple Color.
if EMA % change > = EMA Value, Green Color
See in the below these are some other useful parameters used in the calculation.
The Median length is equal to : the period of observation
The upper band is equal to : Median length + (2ATR)
The lower band is equal to : Median length - (2ATR)
Now in the upper read carefully at the mathematical expression above is use to calculate the median indicator, and you will notice that both the median value and the EMA value are compared. however the value of EMA is greater then the value of median value, then the cloud color will be purple and the reverse is the case. such as, whenever the EMA value is less then the value if median value, then the cloud color will be green.
03. - Uptrend from Median Indicator (Screenshot required)
On the above i also write the median indicator is a trend based indicator, this means it follows the market trends. Here for the uptrend movement by using the median indicator, one we can easily spot it when ever we are notice the median value above from the EMA value, the we conclude that the trend is an a uptrend and for a confirmation of this is usually seen by the color if cloud is green that means it will be form as a result of that. The green cloud is a signal of the trend is bullish and a buy entry can be take when this signal surfaces.
Traders or investers take a buying opportunities when the green color forming is started to appare because it is an a indication of buy signal in the price of the assets. let's see the below screenshot of chart for better understanding.
Here on this upper screenshot we can easily see a median indicator is an uptrend direction and we can easily observe the green cloud as well that the trend is an uptrend. For example the ternd is goin in to the upward direction. Now the buyers enter in the market at this position or time. The presence of the green cloud implies that the trend has reverse from it initial bearish movement ro bullish movement.
04. - Downtrend from Median Indicator. (Screenshot required)
In this way , we would also be looking at how to identify a Downtrend by using median indicator on our chart. we are know that, the traders or investers do follow the trends signals and one we can easily spot it when ever we are notice the value of median indicator is below to to the EMA value, then we conclude that the the trend is an downtrend and for a confirmation of this is usually seen by the purple color cloud that will be form as a result of that. the purple color cloud is a signal that the trend is bearish and a sell entry can be take when this signal is surfaces. lets see in the below screenshot for getting more information.
Now look at this upper screenshot, you will also notice the purple color cloud indicates that the trend is moving in a downtrend market. for example the trend is moving in the downward direction. here the dellers enter the market at this point or te to take thier positions. the presence of the purple color cloud implies that the trend has been reversed feom the initial bullish movement to it bearish movement.
05. - Identifying fake signals with median indicator. (screenshot required)
In this question, first of all we know about that there is no indications that we can say it reads a 100 % signals without any false signals. Every indicator is provided a false signals due to high volatility and fluctuations in the Crypto market.
It is also give us a false signals and that can misleading a lot of traders to take his position where they are not suppose to. as a good trader it is not recommend to trust any false signals or am indicator as none of this indicator is 100% effective. For this way to safe dorm.false signals during Trading. it is recommended that are 2 or more indicatos are used to confirm the trend movement properly. in the other way to identify fake signals i the median indicator. we will be combining it with the RSI indicator to the filter out all the noise as well and as fake signals is gernated by median indicator.
As you know the RSI indicator that is used to get a information about the overbought or oversold of a given assets. When the RSI value is seen from a 70 or above then it's means that the assets in in it's overbought region and a possible to trend is reversal will be expected. Same as when we see the value of RSI is 30.or below then it's means that the assets is an it's oversold region and possible to trend is reversal will be expected. it is also very important to mention here the entry can also be confirmed by using the RSI indicator. for example for a buy entry the RSI value should be above then 50 thershold and to place a sell entry, then the RSI value should be below then 50 thershould. you can also see in the below screenshot for better understanding.
Now you can also see in the upper the median indicator is show in the purple color that is a sign of sell entry and the RSI indicator as we can also see this is already in the oversold region. The median indicator is also expected at this point to show trend reversal but it is still showing a sell position. so this is two signals have ro be in an agreement dor any position to be opened by inveatwrs and traders. Traders at this point are expecting a possible trend are reversal to the opposite direction.
06. - Open Two demo trades. long and short, with the help of median indicator or combination that includes a median indicator. (screenshot required).
Here in this section ofy post i will be performed my analysis for a demo trade by using the tradingview website.
Buy trade Entry
Sell Trade Entry
Lets start discuss about these two trades.
Buy Trade Entry :-
Now as you know on the base of cloud law l, a pair of RUNEUSDT on a 4H timeframe was taken into the consideration. As you can also see in the below chart in which the green cloud is above and the bullish candle stick is seen as well. The RsI indicator at this point is 75 which implies that the trend is a bullish and is a possible reversal may take place.
Sell Trade Entry :-
Now in which same as on the base on cloud law a pair of WAVEUSDT on 4h time frame was take into the consideration. amd now you can also see in the below screenshot the clud color is purple and the bearish candle stick is also sewn as well. in which the RSI indicator point is 48 that means this is a bearish trend.
Conclusion
From this lecture we can learn about the median indicator is tell us to about cloud color is green and purple which is also significance of bullish and bearish trend. and we can learn when the cloud color os in green formation then it's means this is bullish trend and if the cloud color is purple then it's means this is bearish market.
We can also discuss about the fake signals and we learned the no indicator is 100 % effective because it is always recommend that we are used a median indicator along side with other indicator such as the RSI indicator ro find about the false signals and also see a clearly and reliable entry.
And now my this week homework post is complete amd now i would like say thanks to our prif @abdu.navi03 for making a good and informative lecture for us.
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