Short Term Update: How to daytrade on a 15 min chart

chartFor the first time i reveal one of the techniques that i use for  my intraday operativity on this market. This method consists of using a short term average, the VWAP that you already know but calculated using no more then one or two days on a 15-minute chart; togheter with the VWAP i use an oscillator, the Relative Strength Index or RSI.
Whenever prices are testing the VWAP and an oscillator such as RSI confirms the oversold condition you can place a trade with a stop loss below the first negative deviation of the VWAP, this will leave enough room for your trade to avoid stupid stoploss being taken. You can lock in profits as soon as prices break through the first or second upward deviation.

In the attached example you can see very well how this technique works, especially when there is a strong volatility like these days. The RSI period is 8 instead of the canonical 14 used by most, i prefer a faster setting to have less lag, the thresolds used are 30 and 70, common values for this oscillator. When the RSI is below 30 is oversold and above 70 overbought. To give you an idea if prices at bitstamp retest today VWAP at around 595$-600$ and the RSI is oversold below 30 and then returns above it, i open a long position with a stoploss under 450$ with a take profit at 725$ and/or 870$ (first and second deviation of our VWAP average). If the price is too far away from the VWAP when the RSI cross above the thresold at 30, confirming a long trade, i don’t buy and i simply look forward to the next trading opportunity.
So combining VWAP and RSI you are using both time and price dimensions with the effort to maximize your profits, cut your losses and drawdown as much as possible.

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14 thoughts on “Short Term Update: How to daytrade on a 15 min chart

      1. CyberM

        Thanks for the fast reply.
        What are the chances to return to the level of 650$-700$.
        I bought at this level. Now I think close this position or leave till the best times, for six months or a year.

      2. Enky

        Looking the book, with only 4k btc we are back at 750$ at stamp, let see in a couple of hours what happens with the americans. If you go for long term your stoploss should be no less then the 200 day moving average, now at about 140$. we need to wait and let things stabilize a bit.

  1. Tom Luts

    Hi Enky,

    I believe you use sierrachart http://www.sierrachart.com/ for the VWAP indications?
    What is the minimum package you need to have this VWAP indication?

    Package 2 (cheapest) has bitcoin data but does this also include this VWAP?

    Thanks,

    Tom

    1. Tom Luts

      Hi Enky,

      The question is actually what package do I need to be able to apply this system above?
      (VWAP and RSI)

      Like stuff you post!

      Thanks,

      Tom

  2. Tom Luts

    Hi Enky,

    You are talking about a stop loss. Is it actually possible to set a stop Loss?
    I use Bitstamp and I can’t find an option to set a stop loss?
    Do you use another platform or do you do this manually?

    Thanks for the good work,

    Tom

    1. Enky

      stoploss is manual, eventually with btce you can try metatrader4 platform, i’m testing it these days with a demo account.

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