I started trading in 2013 under the guidance of a master, and during my first six months, I didn’t understand much. I traded with a capital of 10,000; whatever my master advised, I followed. Every day I could earn a little, and my capital accumulated to 600,000. However, once I started trading on my own, I inevitably suffered losses, with my account shrinking by 50% due to small profits and big losses.
At that time, I didn't even understand the most commonly used terms and trading rules in the cryptocurrency world, like spot, contracts, going long, going short, etc., it was all very confusing.
Thus, I feel that if I really want to continue on the trading path, I need to study diligently. Besides understanding the basic knowledge, I should also analyze news events and study technical indicators.
If you do not conduct thorough research and reasonably plan your own finances, your capital will only be gradually depleted. In the end, as a rootless retail trader, you will only joyfully enter the market and quietly exit.
After that, I spent a whole 11 months doing contracts, growing from 500,000 to now 30 million, relying solely on a single strategy, the '15-minute candlestick strategy.'
With a winning rate of up to 90%, once mastered, trading in cryptocurrencies will feel like your 'ATM,' making money as easy as breathing!
Today, I will share some valuable insights that are worth 60 million, hoping to help you.
Rule One: Position management — Don’t put all eggs in one basket.
The biggest pitfall in contract trading is 'going all in.' Many newbies think about making a fortune in one go, but a single market fluctuation can lead to liquidation. Experts never do this! Their secret is: strictly controlling positions and always leaving a way out.
Operation mantra:
Single position should not exceed 10% of account funds: No matter how optimistic you are about a cryptocurrency, never put all your funds on it. With a capital of 100,000, the maximum opening position should be 10,000, leaving the rest to deal with emergencies.
Diversified operations to spread risk: Don't just focus on BTC or ETH; choose 2-3 different types of cryptocurrencies to distribute the risk. During a market crash, at least one can hold up!
Dynamically adjust positions: When the market is volatile, reduce the position to 5% or even lower; when the trend is clear, appropriately increase the position.
Case: Xiao Ming has 100,000 funds and decides to trade BTC contracts. He follows the 10% position rule and only uses 10,000 to open a position with 5x leverage. As a result, BTC plummets by 10%, and he only loses 5,000, with 95,000 capital left to recover. In contrast, Xiao Gang goes all in with 10x leverage, and a sudden drop leads to liquidation, losing everything.
Expert thinking: Position control is like playing cards; always keep some chips in hand to turn the tables!
Rule Two: Stop-loss and take-profit — Don't let greed and luck ruin you.
The deadliest mistake in contract trading is 'holding on.' When the market goes against you, many people hope: 'Just wait a little longer; it will definitely rebound!' The result is increasing losses and, ultimately, liquidation. Experts never cling to trades; their secret is: strictly setting stop-loss and take-profit.
Operation mantra:
Set the stop-loss line at 5%-10%: When a single trade loses 5%-10% of account funds, decisively close the position without delay. It's better to accept a small loss than to gamble on a 'big turnaround.'
Set the take-profit target at 15%-20%: Once you earn the expected profit, exit the trade. Don't hope to capture the entire market movement. Locking in profits is the way!
Use technical indicators for assistance: Combine support and resistance levels or indicators like RSI to set reasonable stop-loss and take-profit points, avoiding emotional trading.
Case: Xiao Hong took a long position on ETH, setting a stop-loss line at 7% of the account funds and a profit target of 15%. After ETH prices rose by 10%, they suddenly pulled back, and she decisively took profit, earning 15,000. Later, ETH continued to decline, avoiding losses. Meanwhile, Xiao Bai did not set a stop-loss and watched helplessly as floating profits turned into losses, ultimately leading to liquidation.
Expert thinking: Stop-loss is the shield that protects capital; take-profit is the sword that locks in profits. Both are indispensable!
Rule Three: Go with the trend — Don't go against the market.
There is an old saying in the cryptocurrency world: 'The trend is your friend.' Newbies often make the mistake of trading against the trend, trying to catch bottoms when prices fall and entering shorts when prices rise, ultimately getting crushed by the market. Experts never clash head-on; they do one thing: follow the trend and go with the flow.
Operation mantra:
Use moving averages to judge trends: Look at the 20-day and 50-day moving averages on the daily chart. If the price is above the moving averages, it indicates a bullish trend, favoring long positions; if below, it indicates a bearish trend, favoring short positions.
Wait for confirmation signals: Don’t rush to enter a trade; wait for the candlestick to break key levels (such as previous highs or lows) or for clear trend signals (like MACD golden cross/dead cross) before acting.
Use smaller timeframes to assist larger timeframes: Use 1-hour or 4-hour candlesticks to confirm short-term trends, but always prioritize the daily trend to avoid being misled by short-term fluctuations.
Case: Xiao Li observes BTC’s daily chart, finds that the price has broken above the 50-day moving average and stabilized, and the MACD has formed a golden cross, confirming a bullish trend. He decisively opens a long position with 5x leverage, earning a 20% profit. In contrast, Xiao Wang hurried to catch the bottom upon seeing a short-term drop in BTC, only to be crushed by continuous declines.
Expert thinking: The market is always right. Don't try to predict tops and bottoms; going with the trend makes it easier to make money!
In the last bull market, I turned 100,000 into an eight-figure income. After ten years of trading cryptocurrencies, I now trade full-time, having learned this simplest trading method. Since then, trading in cryptocurrencies has felt like being on autopilot, with a steady green light, simply because I firmly grasped the following 10 rules:
1. For strong coins, if they have dropped continuously for 9 days at high positions, timely follow-up is essential.
2. Any cryptocurrency that rises for two consecutive days must be promptly reduced in position.
3. Any cryptocurrency that has risen more than 7% should still have upward potential the next day, so continue to observe.
4. For strong bull cryptocurrencies, wait for the pullback to finish before entering the market.
5. If a cryptocurrency experiences a flat fluctuation for three consecutive days, observe for another three days; if there is no change, consider switching.
6. If any cryptocurrency fails to recover the previous day's cost price the next day, exit promptly.
7. If there are three cryptocurrencies on the rise, there will necessarily be five; if there are five, there will necessarily be seven. Cryptocurrencies that have risen for two consecutive days should be entered at low points, as the fifth day is usually a good selling opportunity.
Point.
8. Volume-price indicators are crucial; trading volume is the soul of the cryptocurrency world. When the cryptocurrency price breaks out with high volume at low consolidation levels, it requires attention.
Be attentive; when high volume occurs at high levels with stagnation, decisively exit.
9. Only choose cryptocurrencies that are in an uptrend for trading, as this maximizes the chances of success and avoids wasting time. If the 3-day line turns upward, it belongs to
Short-term uptrend: The 30-day line turning upward indicates a mid-term uptrend; when the 80-day line turns upward, it signifies the main upward wave; the 120-day moving average + turning upward.
Head upward indicates a long-term uptrend.
10. In the crypto world, small capital does not mean no opportunities. As long as you grasp the right methods, maintain a rational mindset, and strictly execute strategies.
Be patient and wait for opportunities to arise.
My cryptocurrency trading method is very simple and practical. In just one year, I traded my way to an eight-figure income, only entering the market when I see the opportunity, avoiding trades without patterns, and maintaining a winning rate of over 90% for five years!
I will share another set of my own practical strategies that have achieved an average winning rate of 80%, which is quite a rare achievement in the cryptocurrency trading world.
In trading forex, futures, and other assets, an ideal 15-minute trading strategy involves applying technical indicators such as moving averages, Bollinger Bands, and the Relative Strength Index (RSI), combined with robust risk management techniques. Effectively using these tools helps us find accurate entry and exit points, which is particularly critical for short time frame trading styles.
The key to this strategy lies in executing strict stop-loss orders and adjusting position sizes according to current market volatility.
Key components of 15-minute trading strategies.
Successful 15-minute trading strategies depend on multiple key factors, including market conditions, precise technical indicators, clear entry and exit points, rigorous risk management measures, ideal trading times, strict backtesting, ongoing market monitoring, and the efficiency of selected indicators.
It is very important to use relatively tight stop-loss and tailored take-profit levels. For example, a typical recommendation might be to set a 10-point stop-loss combined with a 20-point take-profit, which effectively protects traders from significant capital losses while locking in potential gains.
Adjusting position sizes based on volatility and current market conditions can strengthen this protective framework, ensuring that each trade is proportional to the assessed risk (a 2:1 reward-to-risk ratio).
Effective technical indicators for 15-minute trading.
Due to its responsiveness and accuracy, several tools stand out in assessing the effectiveness of technical indicators in the 15-minute trading cycle. Moving averages and Bollinger Bands provide detailed information about market trends and volatility, making them very useful in short-term trading analysis.
The Relative Strength Index (RSI), Parabolic SAR, and Average Directional Index (ADX) help identify potential reversal points and maintain market momentum, thereby enhancing your trading decisions.
Moving Averages
Using moving averages, especially the 5-day and 10-day moving averages, can simplify trend analysis and help determine market volatility in 15-minute trading charts. These short-term moving averages are often used when executing momentum trading strategies, focusing on capturing rapid market changes triggered by currency pair volatility.
The moving average crossover technique is a key aspect of this method. When the 5-day moving average crosses above the 10-day moving average, it indicates a potential buying opportunity; conversely, it signals a selling opportunity.
These moving averages also help traders identify support and resistance levels, which are crucial for trend-following strategies in this compressed timeframe. By understanding the location of these levels, traders can better predict potential reversals or trend continuations, thereby improving decision-making accuracy.
Combining Fibonacci retracement with moving averages provides another framework for price action analysis. This combination allows traders to identify important price points and adjust their strategies to ensure alignment with the micro-fluctuations and overall trends displayed in 15-minute charts.
Relative Strength Index (RSI)
The Relative Strength Index (RSI) is used to identify overbought and oversold conditions in 15-minute trading strategies. This momentum oscillator measures the speed and change of price movements, with values ranging from 0 to 100.
Generally, an RSI (Relative Strength Index) below 30 indicates an oversold state, suggesting potential buying opportunities, while above 70 indicates an overbought state, hinting at a possible sell-off. Traders commonly use these thresholds to predict reversals when the market reassesses prices.
The RSI also provides signals for trend confirmation. When the RSI aligns with the current price trend, it confirms the current momentum, allowing traders to strengthen their positions accordingly. For example, in a bull market, an RSI above 50 supports the continuation of an uptrend. In a bear market or during price declines, an RSI below 50 can confirm a downtrend.
RSI divergence plays an important role in identifying changes in market dynamics. When RSI diverges from the corresponding price trend—i.e., when prices make new highs or lows but RSI does not—this often indicates a weakening trend and may signal a reversal.
This inconsistency between price and RSI can be a strong signal to reassess positions, thereby enhancing the effectiveness of short-term trading strategies.
Bollinger Bands
The Bollinger Bands indicator can help traders assess market volatility and identify potential breakout points in 15-minute trading strategies. By placing price movements within dynamic 'envelopes', these indicators adjust based on recent price fluctuations, making them very suitable for quick decision-making in the 15-minute timeframe.
◎ Bollinger Band Squeeze: When the Bollinger Bands tighten around the price, it indicates reduced volatility, often signaling a significant price movement. Traders observe breakouts after squeezes as entry signals.
◎ Breakouts and reversals: Price breakouts can signal impending reversals or trend continuations, which are crucial for quick profits in 15-minute charts.
◎ Bollinger Band Width: This indicator helps quantify market volatility. A narrowing width indicates potential squeezes, while an expanding width suggests increasing volatility.
◎ Touch points: When prices touch the lower or upper band, it can serve as a key trading signal, indicating overbought or oversold conditions.
Each aspect above ensures that Bollinger Bands become part of effective trading in short timeframes (especially during squeezes), providing insights into market dynamics (especially consolidation).
Parabolic SAR
Another effective technical indicator suitable for 15-minute trading strategies is the Parabolic SAR, which performs excellently in setting trailing stop-loss and exit timing. This indicator is known for its ability to provide clear exit signals, enhancing the risk management techniques of short-term traders.
When analyzing the Parabolic SAR indicator strategy, backtesting results show that this indicator performs well in trending markets. Traders typically use it to determine stop-loss levels, effectively protecting profits or preventing significant losses. By adjusting the acceleration factor, traders can fine-tune the indicator's sensitivity to align with their trading strategies.
When comparing the Parabolic SAR indicator with other indicators, its effectiveness lies in its simplicity and direct visual presentation on charts. Unlike more complex indicators, the Parabolic SAR provides direct, actionable information without lengthy explanations, which is crucial in fast-paced 15-minute trading windows.
Average Directional Index (ADX)
The Average Directional Index (ADX) is vital for quantifying trend strength and identifying current market trends. Traders rely on the ADX to show the strength of the trend. The interpretation of the ADX is important under various market conditions, offering a clear perspective on whether the trend is strengthening or weakening.
When trading in a 15-minute timeframe, the ADX provides important information:
◎ Trend confirmation: An ADX value above 25 indicates a strong trend, laying a reliable foundation for trend-following strategies. This level of trend strength is crucial for confirming potential entry signals.
◎ Detecting trend weakness: A declining ADX value indicates a weakening trend, reminding traders that market conditions may be changing or that caution is warranted.
◎ ADX crossover: When +DI (positive directional indicator) and -DI (negative directional indicator) cross, it may signal a trend reversal, guiding traders on when to potentially exit or enter opposite positions.
◎ Filtering market noise: By distinguishing between trending markets and ranging markets, the ADX helps filter out trading setups with lower profit potential, focusing on trades with a higher probability of success.
Stochastic Oscillator
Based on the Average Directional Index, the stochastic oscillator can also serve as a tool for identifying overbought and oversold conditions in 15-minute trading. This indicator is particularly suitable for short-term traders looking to capitalize on rapid market fluctuations.
The stochastic oscillator involves two lines: %K, which measures the current price relative to the highest and lowest prices over a specified period; and %D, which is the moving average of %K. When %K breaks above %D in the oversold region (below 20), it typically indicates a potential buying opportunity. Conversely, when %K breaks below %D in the overbought region (above 80), it usually signifies a selling signal.
The settings for the stochastic oscillator can be adjusted; however, on 15-minute charts, traders typically use a 14-period %K and a 3-period %D. These settings help smooth the output of the indicator, making signals clearer, especially in short-term trading where frequent price fluctuations can disrupt signals.
Identifying divergences in the stochastic oscillator can enhance trading accuracy. When prices form new highs or lows, while the stochastic oscillator shows no corresponding change, a divergence occurs, suggesting a potential price reversal. Divergences can serve as clues to strength changes in price movements that may not be obvious in pure price action.
SuperTrend (Super Trend Indicator)
In 15-minute trading, another important indicator is SuperTrend, which effectively identifies trend direction and sets ideal stop-loss levels. The advantage of SuperTrend lies in its simplicity and clarity, accurately signaling bullish or bearish market sentiment.
SuperTrend combines price volatility and Average True Range (ATR) factors to determine the position of trend lines. This helps traders make informed decisions quickly based on current market conditions, especially suitable for short-term trading like in 15-minute charts.
When configuring SuperTrend settings, traders typically adjust the ATR multiplier and period to suit the volatility and price dynamics of the traded assets. Adjusting these settings is crucial for improving the indicator's sensitivity to price fluctuations, thereby enhancing the accuracy of trend predictions and the effectiveness of stop-loss orders.
Determine entry and exit points.
Determining precise entry and exit points on 15-minute forex charts requires the use of technical indicators and chart patterns to quickly capture short-term price movements. Traders must analyze multiple trading indicators and patterns to make informed decisions swiftly.
The following are important tools and concepts for determining entry and exit points:
◎ Candlestick patterns: Use common 15-minute candlestick patterns, such as engulfing patterns, hammer lines, or shooting stars. These patterns can indicate potential reversals or trend continuations, providing clear signals for entry or exit.
◎ Fibonacci Retracement: Apply Fibonacci retracement levels to identify potential reversal points in the short term. These retracement levels often serve as support or resistance levels, where prices may stop or reverse, making them very important in quick trades.
◎ Support and resistance levels: Strong support and resistance levels are crucial in 15-minute trading. They provide areas where prices may pause or reverse. Identifying these levels helps formulate entry plans for breakout or rebound trades and set precise stop-loss or take-profit points.
◎ RSI and moving averages: Combine RSI with moving averages (such as the crossover of the 5 EMA and 20 EMA) to confirm entry signals. RSI helps identify overbought or oversold conditions, while moving averages are used to determine trend direction and momentum, aiding in timely execution of trades.
Three common 15-minute forex trading strategies.
Due to its effectiveness and adaptability, several strategies are widely used.
The opening range breakout strategy utilizes early market volatility to establish profitable positions.
In contrast, breakout backtest strategies and trading bull flags provide methods to identify and leverage patterns for potential gains within this short time frame.
Forex opening range breakout strategy.
The opening range breakout strategy utilizes the volatility of the first 15-minute candlestick of the currency pair after the London session opens, profiting by setting trades at its high and low. This method leverages the initial price fluctuations that occur during the most popular forex trading session.
By focusing on price behavior during this time frame, traders can see potential directional trends based on market strength and movements after the market opens.
◎ Visual candlestick chart: The first 15-minute candlestick is crucial; its upper and lower shadows represent potential breakout points.
◎ Market entry: Traders set buy orders above the high of the candlestick and sell orders below the low, aiming to capture quick fluctuations.
◎ Volatility analysis: Assessing the size and shape of the opening candlestick can provide insights into early market sentiment and potential volatility.
◎ Trend identification: Successful breakouts may confirm or establish trend direction, guiding subsequent trading decisions.
The opening range breakout forex strategy leverages candlestick patterns to identify trading opportunities, ensuring that traders align with the initial momentum of the market by observing price behavior and market volatility.
Breakout backtest strategy.
While the opening range breakout strategy leverages early market volatility, the breakout backtest strategy focuses on capturing price movements after retesting key support or resistance levels. This currency trading method is based on a principle: once critical levels are broken, prices are likely to retest those levels before continuing the trend.
Traders using this method will observe breakout patterns on higher time frames (such as 1-hour or 4-hour charts) to determine relevant support or resistance levels for currency pairs.
Once these levels are established, the strategy will shift to a 15-minute chart, focusing on pullback rebounds. The core of this strategy is to enter trades during these rebounds, capitalizing on the frequent minor fluctuations that occur when prices retest previously broken levels. This approach aids in trend identification and improves the accuracy of entry and exit points when trading major currency pairs.
The execution method for the breakout backtest strategy is as follows: identify the breakout, wait for the backtest, and then execute the trade based on the confirmation of trend continuation on a 15-minute chart. This method aims to maximize profits from short-term fluctuations in currency, making it an effective strategy for day traders to use structured methods to capitalize on rapid rebounds.
Trading Bull Flags.
Among various 15-minute trading strategies, trading bull flag patterns stands out for its efficiency in utilizing upward price movements after consolidation periods. This method leverages the formation of the 'bull flag' pattern, characterized by a sharp price increase followed by a brief period of sideways or downward consolidation, resembling a flag on a flagpole.
To effectively use bull flag patterns in a 15-minute trading window, traders should focus on the following key elements:
◎ Flag pattern analysis: Carefully inspecting the flag structure is crucial. A true bull flag typically exhibits a sharp rise of the flagpole, followed by a rectangular flag with little significant change in volume.
◎ Volume confirmation: Successful trading of bull flag patterns requires validation through volume analysis. Ideal breakouts are accompanied by increased volume, confirming the strength of the pattern and the likelihood of trend continuation.
◎ Pattern reliability: Historical data should be evaluated to understand the reliability of flag patterns under similar market conditions.
◎ Entry and exit points: Accurately identifying entry points during flag breakouts and strategizing exit points to maximize profits is crucial.
Risk management in 15-minute trading.
In 15-minute trading, effective risk management relies on implementing precise stop-loss and take-profit orders to protect capital and maximize profits. Adopting a disciplined position size management approach is also important.
By following the 1% rule (especially as a beginner), traders ensure that the risk of a single trade does not exceed 1% of their total trading capital, thus maintaining manageable risk exposure amidst market fluctuations.
Technical indicators like the Average True Range (ATR) can be used to align stop-loss orders with current market volatility. This approach helps accommodate normal price fluctuations without exiting positions too early.
Setting stop-loss orders just outside key support and resistance levels can give trades enough room while still preventing significant losses.
Trading psychology cannot be overlooked. Maintaining emotional discipline by adhering to pre-set stop-loss and take-profit levels helps mitigate the influence of emotional trading decisions, which can often be very strong in short-term trading scenarios.
Regularly reviewing and adjusting these orders based on changing market conditions is crucial for effectively responding to market volatility and protecting trades from sudden changes in market sentiment.
Backtest and optimize trading strategies.
Backtesting 15-minute trading strategies requires a method to validate their effectiveness and adaptability under different market conditions. Analyzing historical data for risk assessment and performance analysis is vital for optimizing strategies and enhancing their potential profitability.
The following are best practice guidelines for backtesting and optimizing such strategies:
● Use sufficient historical data: Ensure the data covers various market conditions, including trends, volatility, and consolidation periods. This diversity tests the strategy's robustness and adaptability.
● Incorporating real trading conditions: Consider slippage, commissions, spreads, and execution delays to simulate real market conditions. This step is crucial for accurate performance analysis.
● Conduct advanced statistical analysis: Use techniques such as standard error measurement to understand the uncertainty and risks associated with the strategy. Additionally, calculate the expected value of the strategy to predict potential profitability.
● Conduct forward-looking analysis and continuous optimization: After initial backtesting, apply the strategy to new, unseen data segments to check for consistency. Continuously optimize and adjust parameters to avoid overfitting and adapt to changing market dynamics.
These practices ensure that strategies can withstand historical testing and have potential in real-time trading scenarios.
Conclusion
Effective 15-minute trading strategies require the use of technical indicators, identifying entry and exit points, and strict risk management.
Common strategies designed for this timeframe should be backtested to improve their efficiency and accuracy. You need to be well-acquainted with your strategy.
Adhering to these principles can enhance the potential for success in the fast-paced 15-minute trading environment, optimize the decision-making process, and improve the trading outcomes of your positions.