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Dear Crypto Trader,thanks for downloading this Freebie intended to help you todramatically increase your trading performance!If you learn the right tactics and use them withdiscipline and – of course – fun, you can becomefinancially independent and free.Become a pro trader to create the life of your dreams.This ebook is about one specific crypto trading strategy which hasalready pretty often led to nice gains, or even massive ones.Be aware that every trading strategy always comes with a certainamount of risk – price can always turn against you – but that’s nobig deal if you make sure you get out early again. The trick is to cutlosses short and to squeeze the most out of the winning trades.The following is among the trading strategies used by professionaltraders knowing the most proven techniques and procedures.2cryptotradingbook.com
First of all the boring stuff we must include.Disclaimer:This ebook is for information purposes only. The content in this book should not beconsidered financial advice. Your investments and trades are your very own decision.We do not make any promise or guarantee as to any results that may be received fromusing our information. Readers of our content should never make any investment ortrading decision without first consulting their own research or their own financial advisor.The information in this ebook does not claim to be complete, reliable or accurate.We disclaim any and all liability concerning any information, analysis, advice, opinionsand/or recommendations prove to be incomplete, inaccurate or unreliable. The information in this ebook may not be responsible for any investment or losses of readers.The content in this ebook it not intended to constitute financial advice in terms of investments or trades. The reader’s use of the information or of information on linkedexternal websites is at the reader’s own risk.Please note the following:Never trade more than you can afford to lose.Only trade after extensive research.Be aware that Crypto trading can be dangerous for personalities which areprone to addictions, comparable to gambling. Make sure you avoid addictionin order to secure your lifestyle.3cryptotradingbook.com
THECRYPTOBREAKOUTSTRATEGY4cryptotradingbook.com
Setup for a Breakout Strategy Example:Definition:We define what we are looking for: A breakout of an altcoin that iscurrently on a very low price level compared to it’s overall chartpicture. Due to the low price level there is a lot of upside potential.Duration:Time frame for the trade duration after the entry would be severaldays (maybe even few weeks) – Bigger moves can also occur within a single day, but more often it takes a little longer, depending onthe general market situation.Charting:We use charts in BTC (not USD), our goal is to get more BTC.We use at least 2 time frames, e.g. for free on Tradingview.com(use for free, no need to purchase a plan):For example the daily (D), and the 3 hour (3h) chart.(The daily chart is just to see the chart from a higher perspective,so you see how low price actually is in the bigger picture and someother details, such as key price levels of the particular chart.)The 3 hour chart is the time frame we want to trade in, as this fitsto a trade which is supposed to run for at least a couple of days,(up to even a few weeks). So after having checked the daily chart,we switch to the 3 hour view.Planning The Details:5cryptotradingbook.com
1.TRADE ENTRY6cryptotradingbook.com
Before we actually buy, we need to look for a precise entry.The following examples are the kind of charts we’re looking for.Their bigger picture (1Day chart) is showing past pumps and currently a low price level:Since we want to buy low and sell high, the sticking point is to lookfor clear breakouts of the low price zone.7cryptotradingbook.com
Otherwise you might have to wait for weeks or months till pricecoincidentally finally starts into a bull market again – in case itdoes.So we look for the combination of 2 factors:Low price altcoins signals of confirmed breakoutThat way you don‘t get the very lowest entry price, but the chart ismore likely to go up soon. And that‘s our point – profit from an uptrend as soon as possible and not somewhere in the future.Here is a chart example of what we are searching: A chart whichlooks like it might have past it‘s bottom and could be about to startan uptrend in the near future.Our Trade ExampleUse such Trend Lines!First sign of breakout in daily (D) chart8cryptotradingbook.com
We found a daily chart showing signs for a breakout into a newuptrend. The previous longer downtrend had been broken recentlyand price seems to head upwards.Now Comes The Trick:The strategy is to buy at a point where the new uptrend seemsconfirmed.So it‘s more likely not just a fakeout which falls back to the bottom,but really the beginning of an uptrend.What we want to see is a higher low staying above the last resistance layer in our trading time frame which is the 3 hour chart.So in the previous picture you see the daily chart and the following oneis the same chart, but on a 3-hour time frame (zoom into lower timeframe to see the price action more precisely. Also the 3 hour chart isthe time frame we want to basically use for our trade):price should stay above resistanceto show a “real” breakoutresistance layerwait if new support getsconfirmed by price stayingabove AND forming a newhigher low3hour chart – first sign of breakout in lower time frame detail9cryptotradingbook.com
The breakout seems confirmed when the price stays above therecent resistance, which should turn into support.Then the chart should be forming higher lows and higher highs askey indicators for a new prevailing uptrend.Entry should always be near a low in your trading time frame, notat a high! “Buy The Dip”Confirmed Breakout:higher highshighentrystop losslowhigher lowsvolume should stay increased since breakoutSo in our example price stayed above the recent resistance andeven formed a higher low compared to the previous low.When the next higher low seemed manifested by price headingupwards again we used it as buy signal: Trade entry.10cryptotradingbook.com
2.STOP LOSS11cryptotradingbook.com
Right after your entry it‘s crucial to set a stop loss order as there isof course never a guarantee for anything.Price could dump over night because of sudden negative fundamental news and stay under your entry. That‘s what you want toavoid.A stop loss makes sense at an area where the trend would definitely seem to be broken (at least for the moment) – that‘s wherepro traders get out of it quickly before bigger damage can happen!Just as a reminder what happened to thousands of traders insummer 2017, when they didn‘t expect their coins to go down thatmuch.Not having an emotional problem with being stopped outseparates the winners from the losers.Pros can take it rationally: One big gain will compensate a coupleof small losses by far. Especially in crypto. So not getting emotionally caught by one single trade is very important.entrystop loss12cryptotradingbook.com
3.TARGET13cryptotradingbook.com
We estimate where price might head to within the near future.The estimation of a potential price target is part of every pro trader’s strategy, because this frame work justifies the trade.Only if you have an idea where price might be heading to, you knowif the trade is worth a try or not.How to Estimate Profit Targets:So why do we think that price could rise at least 50% or more inthis case in the chart example we chose for our trade?:In this example we use former resistance and support areas forour estimation. When price starts to climb up again, it often targets former key price levels.Estimated target zone based onformer key price level (whereprice repeatedly went back tofrom both directions)Again the daily chart of our trade example – showing price action over monthsIn the bigger picture of the chart above there is this obvious keyprice level to which price had moved back from both directions,14cryptotradingbook.com
well shown by the chart image. Such an area is generally a highprobability target.In crypto there is always the chance that price could pass this target zone with ease and move further upwards. Then traders canstill adjust their trade management.But first, traders should always have an estimation for aminimum target zone that price is most likely going to hit, aspart of a decent trading strategy.So the most likely next key price target seems to be the markedzone in this case.Here you see the target in the 3-hour detail near our entry:Target Zonerecent resistanceentrystop lossAgain zoom into detail: 3 hour chart – breakout zone in relation to target zoneAs soon as you can move your stop to break even, because pricehas left the zone clearly behind it, you‘re already safe in any case:15cryptotradingbook.com
Target Zonemove stop loss up to or slightly above entry(to cover trading fees) stop at break evenentrystop loss orderExample Of Price Hitting Target ZoneIn an older trade example price had already hit the target, so weuse this example to show options how a trade can be managedwhen the target is reached.Let’s have a look at our hedging strategy from this similar trade:Initial Target Zoneentrymove stop loss up stepwisebelow new support zonessupport layers16Initial target zone: when reached you could take partial profit as hedgingstrategy and for the rest keep the stop loss order in placecryptotradingbook.com
A good hedging strategy is generally to take partial profits.In the example above price had hit our estimated target, so we decided to take partial profit (50% in this case).We kept the rest secured by our stop loss order below the newsupport area, so we could watch how far price would go.Getting stopped out with the rest of the position on this level wouldalso have been fine, since we were in profit in any case.You can take more partial profit stepwise with the rest of your position around highs of the wave movements of price.The enhanced stop loss will always secure the rest.17cryptotradingbook.com
The Breakout Strategy at a Glance:181Look for Altcoins being overall on a low levelin the bigger chart picture (daily/3-day chart)2Look if there is a first sign of a breakout3Look if breakout gets confirmed byresistance turning into support andhigher lows/higher highs4Estimate target zone based onformer key price layers5Define your entry price near a low6Define your stop loss under the support linewhich mustn‘t get broken – otherwise get out7Handle the trade, manage risk. E.g. take partialprofit, move up stop loss for the rest. Take profithigher or keep moving the stop loss.cryptotradingbook.com
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Content Copyright Information:This ebook is a production of cryptotradingbook.com. We hold full ownership and copyright of the content within this ebook. We keep full rights to public distribution.Chart Images: Tradingview.com20cryptotradingbook.com
The Breakout Strategy at a Glance: Look for Altcoins being overall on a low level in the bigger chart picture (daily/3-day chart) Look if there is a first sign of a breakout Look if breakout gets confirmed by resistance turning into support and higher lows/higher hi
