We are now going to be looking at the Bitcoin Cash vs Bitcoin (BCHBTC) chart, read the signals and also consider how to best approach this type of chart setup for trading purposes.
Let’s start with the chart:
The main signal is an ascending channel.
This means a bullish trend has been set and we have higher highs and higher lows. This has been happening since July 2022, more than six months we already consider a long-term.
Today we have a strong bullish candle as prices move above EMA10.
How would we approach this type of chart setup if we were looking for a trade?
It depends on your trading style and your goals… Let’s get started!
- If you are a short-term trader, you want to buy with a tight stop-loss. Here I use the Fib. retracement tool to tell me the different support levels and we can see the 0.786 level at 0.00542. You simply buy above this level and hold… If prices move and close below your stop, then the trade fail and it is loss, you incur a 7% loss.
- If BCHBTC goes higher as the chart is showing today, then there is plenty of potential to grow as a higher high should be in place. Higher lows lead to higher highs.
- If you are a medium term trader you would need a stronger stop-loss and in this case you can use the low set in July 2022. The stop-loss would be set below this low which is equal to around 16%, we use always a manual stop-loss, this will be explained in a different trade idea.
- For long-term traders is easy, just buy and hold. You can define your risk in whatever way you look but in this case, BCHBTC already hit bottom and it can grow for years to come.
- Hold long-term until it is obvious that the market is in full blown bullish mode.
Here is the long-term chart:
- Short-term we call within 30 days (1 month).
- Medium-term we refer to action happening within 1-3 months.
- Long-term we refer to a time window of 3-6 months. Long-term can go beyond 6 months and reach 12 months or even years.
We continue with the basics and will expand day by day.
Thank you for reading.
I hope you find this information useful.
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