SEC S18-W6 || Mastering the Break Retest Break (BRB) Strategy

Hello Crypto Lovers hope you all are well I am fine. Today I came to participate in the engagement challenge of season 18 week 6. This time the topic of the competition is Break Retest Break (BRB) Strategy. Anyway, this contest has been given on a very beautiful topic. Let me start.

Explain in detail the concept of the Break Retest Break (BRB) strategy. How can this strategy be applied specifically to trading the Steem token?

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The Break Retest Break (BRB) strategy is trading technique that centers around the breakouts as well as retest of specific levels in the market. The strategy aims at following those scares or giant thumps of measures because they look for potential strong price movements whereby one identifies a breakout of established resistance or support levels, a retest is done and yet another breakout in the same direction is observed.

Implementing this strategy with the aim of trading the Steem token implies determining critical resistances or supports on the price chart of the Steem token. Resistance levels are levels that the price has previously failed to advance through while support levels are on the other hand levels that price has previously failed to decline through.

In trading, the use of BRB strategy would entail the trader watching out for a breakout above the resistance level in relation to Steem. Specifically, once a breakout happens, one has to wait for a retest of the level that was broken. Such stock breakout gives another chance to confirm that the breakout is strong enough to go higher. Hence, if the retest remains valid and price bouncing off the previous resistance level, it will form the new support level signifying a probable bullish run.

After the confirmed buy signal from the retest the trader would wait for the breakout again but this time in the same direction of the first breakout. This second breakout is more convincing and indicates the definitive take off in the right direction and gives a trader a chance to open a position or increase an existing one.

It is imperative to mention, the BRB strategy like any trade strategy comes hand in hand with respect to risks management tactics and examination of the existing market conditions. Traders should also perhaps occupy more technical factors or tools to support their decision-making.

What are the specific entry criteria for a position using the BRB strategy? Include specific technical indicators and market conditions for the Steem token.

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The specific entry criteria regarding the BRB strategy for a particular position may be different to a person’s preferences to their tolerance for risk. However, here are some general guidelines that can be considered when applying the BRB strategy to trading the Steem token.

Breakout Confirmation: Wait for the confirmation by seeing a bullish breakout above a major resistance line on the Steem chart. This can be done by naked eye or by some technical features like moving average or trend line or oscillators like RSI or Stochastic Oscillator or others. Volume must be used ideally in combination with the breakout, or there should be evident buying pressure.

Retest: Once the breakout occurs, wait for some time and look for a test of the previous bar’s low as a new support level. Retests should reveal the price declining towards the retest level, and that is it, reversing or a very strong rejection signaling adequate demand.

Second Breakout Confirmation: If the test holds the higher ground and starts moving in a higher direction, a second break out should also be in a similar direction. As such, this breakout proves the existence of an upward trend and enables a trader to enter a certain trade or increase the existing position. Another signal during second breakout may be volume expansion and this will also corroborate the strength of the move.

Risk Management: Identify the level of your risk tolerance and stick to the particular stop-loss levels to avoid hefty losses. This can be done by placing the stop-loss order below the retest level or a chosen technical support level according to a persons’ risk tolerance levels.

Market Conditions: Take into account the general climate of the markets and the reception that the Steem token has been receiving of late. Easing your trades with the market trend is also to your advantage because it will aid in determining most of the trades. In order to speculate the flow of Steem, identify what is happening in the market for Steem and what is happening within the Steem ecosystem to identify trends and sentiment.

Confirmation with other Indicators: Although the BRB strategy applies anchors of breakout and retest, it can be coupled with other technikal tools and chart patterns. For instance, trader may hope for a bullish signal for the stock of his/her interest on the basis of MACD (Moving Average Convergence Divergence), or bullish charting formation like ascending triangle or bullish flag.

Lastly, don’t forget that the presented strategy is your flexible plan, and you have to combine the outlined steps with your personal trading style. To use any form of trading technique, one has to analyze and backtest the patterns, think about the risk and practice it as well as consult a trader or a financial expert.

Describe the exit criteria for a position based on the BRB strategy. What signals or conditions should be present to close a position in profit or loss?

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Thus, it is possible to identify a few key signals or conditions defining the exit criteria for a position based on the BRB strategy. Here are some guidelines to consider when exiting a position.

1. Stop-loss: It is advisable to establish correct quit loss levels to safeguard against possible losses. Stop loss level should be placed just below the retest level of the mean line or any other important support line. When price has breached the stop-loss level it may mean the absence of the breakout and incoming reversal, therefore, means it is time to take profit to prevent additional loss.

2. Take-Profit Level: The identifying of take-profit level should be made depending on the prospective of the trade as well as the nature of the fluctuation within the market, support or resists zones, and the trends of the market. Located above the previous or the next prominent landmark, the take-profit level ought to be situated above the present trend of the trade.

3. Reversal Signals: They include reversal bars such as hanging man, shooting star, an abandoned baby, and spinning top among others, different moving average crossovers, new trends against the main trend in the market. Reversal signals are that forces suggest that the market direction may change, and you have to exit the trade.

4. Risk Management: For simplicity, think about the expected gain as inversed by the risk measure of the trade. In situations when you fit an actual profit that is low and simultaneously potential risks are high, it would be reasonable to cut the losses and leave the trade.

5. Market Conditions: Monitor the general market factors combined with the market sentiment in relation to the Steem token. It is advisable to close the position if the market news or its developments shifts the odds in the trade’s unfavorable position.

6. Trailing Stop Loss: With any increase in the price in your direction, you should also move the stop loss order up to save profits that have been gained.

Of course, experience shows that exit criteria are conditioned by the tolerance to risk and trading strategy. To decrease loss and increase profit, it is crucial to transform the criteria in accordance with own trading strategy. Never apply any trading style or system without the analysis of the relevant information and always consult experienced traders as well as financial advisors.

Provide a detailed example of a BRB trade on the Steem token. Include entry points, exit points, and the reasons why you chose these points. Use graphics to illustrate your example.

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You can easily understand the drawn patterns. I have drawn very well here about antiproid and staff loss point support and resistant and shell target and second center gate. Hope you don't have difficulty understanding. I am indicating the prizes here for better understanding.

Buy 0.1790 and place a stop loss close to 0.1717, the lowest rate in the past. Stop loss should be used here because if the market reaches this level, it may go down further. By looking at the second track, you can understand that in the second one we will wait for a while and if the price goes up from there and hits the price that was the highest and goes up again, then of course we will be in the upper end and our target will be the highest price. My first first high target is 0.2037 and the next high target is 0.2254. Steem price is likely to go down from here because there may be supply zone and there will be selling pressure. Of course, you have to be an expert in all these matters, otherwise you will not understand anything, so do not invest here without understanding. Learn, understand and seek the help of an expert if necessary.

How do you manage risk and capital when using the BRB strategy? Discuss risk management techniques and how to set stops and limits for Steem token trades.

General risk and capital management additionally plays an important role in trading with the BRB strategy. Here are some risk management techniques and guidelines for setting stops and limits in Steem token trades.

Determine Position Size: When getting into a trade, determine its right size depending on the level of risk that the trader is willing to take. It is wise to contribute some of your money that you are willing to lose, usually not more than 2-5% of the total amount.

Stop-Loss Placement: Choose an appropriate stop-loss measure based on the particular breakout and. Relative breakout/retest levels of the Steem token should be used to set a predictive stop loss level. The stop-loss order should be placed just below the retest level or a major support level. Such zones are used to unlock the trade if in conflict with the price position, meaning failure of the breakout.

Trailing Stop-Loss: As the price moves in your direction special attention should be paid to protecting your profits and limiting the possible losses, so when the price approaches the stop-loss level it is better to increase it in order to secure the profit. A trailing stop-loss order can also be fixed at some percentage below the present market price or above the current market price. It assists in the ‘locking in’ of your profit by a process that changes the stop-loss level upwards thus enabling what may be termed as the ‘taking of a profit’, in the event that there is a tempted price reversal.

Take-Profit Level: A specific plan must be made of when it is best to take profits relative to the options of the trade. Previous or upcoming major resistance levels should be used as predetermined take-profit levels. This can be in form of price analysis of the token specifically the Steem token, the levels of support and resistance and the current market structures. The take-profit level should be moved higher in proportion to risk-reward ratio to increase the aim for higher return compared to amount of risk assumed.

Risk-Reward Ratio: Though, in a risk management scenario it is important that risk has to be measured in terms of its risk-reward ratio. Find out the approximate profit in respect of the level of risks prior to engaged in a trade. Ideally, aim for a risk-reward ratio of at least 1:Higher than 2 or greater, then it indicates that the potential profit is at least as much as double the potential loss. This assists in availing that more winning trades are made to counter the number of losing trades in trading.

Diversification: Always consider opening positions in different asset types and freights to reduce the risk in one single operation. It is not wise to venture most of your capital on one trade or on just one digital currency such as Steem. Thus, even if any of your investments turns out a boast, it will have constricted effects on your portfolio.

Regular Evaluation: Tracking the market conditions, the indicators, the news of crypto currency and its relation with the Steem token. Daily provide technical analysis of the trade and in the process re-adjust your stop-loss and take-profit levels appropriately. Learn about trailing stops to use them to protect profits and change the initial targets when there is new information.

It is important to highlight that all the risk management methods are point specific and highly depend on your level of risk, trading plan, and the current market environment. A lot of research should also be done, one should keep focus and on top of that one should be flexible in case control measures fail.

Many thanks to everyone I am tired of writing and this is really a very critical topic. Although traders have mastered them very easily and can easily identify them and use them. Anyway, stay well everyone and I'm ending here wishing everyone good health.