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CRTRADERSIGNALX is a tool for the Prediction of the High Probability Trend. It is used to Predict the Movement of any CRYPTOCURRENCY of the Stock Market.
The Crtradersignalx tool is based on the signals generated by the SIGNALX Prediction Method. The fundamental advantage of Crtradersignalx is that it is applicable to any INDEX and STOCK of the Stock Market.
Crtradersignalx can be used in any time frame. Crtradersignalx generates predictions of the movement of the price with high probability.
The SIGNALX method is based on the instantaneous calculation of Technical Trend Indicators and Price Levels based on Pivot Levels, Support Levels and Resistance Levels. SIGNALX method generates the signals based on the following Technical Indicators:
The following graph shows the Movement of the price in a Time Frame of 1h for the Stock Bitcoin of the Stock Exchange Market.
We have selected among the different Representation System of the Price Movement the one corresponding to Japanese Candles also known as Candlestticks.
The SIGNALX Trading System can also be used with Heikin-Ashi candles. Remember, in this example, each candle represents the Price Movement for a period of one (1) hour.
The candles or Candlesticks of GREEN color, represent bullish movements of price and the candles or Candlesticks of RED color, represent bearish movements of the price of the Stock.
The first indicator of the SIGNALX System is formed by three (3) Exponential Moving Averages of periods 14, 20 and 40, respectively. This indicator is very powerful. It informs us if the Market is bullish or bearish. The indications that we must interpret of the crosses are the following:
In the attached graph we have represented with a letter “C” inside a BLUE CIRCLE, the crossing points of the three (3) EMAS for the DAX index within a time frame of 1 h.
We have represented with a GREEN UP ARROW, the sections corresponding to BULLISH CROSSINGS. We represent with a RED DOWN ARROW, the sections corresponding to BEARISH CROSSINGS.
Remember, that in low intensity sideways markets, it is preferable not to enter the market and wait for a clear trend to be declared, be it bullish or bearish. We must always operate with the Trend.
The Trend is our friend. Operating against the Market Trend inexorably means losing our investment.
The RSI indicator or Relative Strength Index, is a Relative Strength Index, as its name indicates. This Technical Indicator is an oscillator type and measures the force of the price movement. Its objective is ultimately to measure the speed of the Price Movement whether it goes up or it goes down, in a given Time Frame.
This indicator was developed by the analyst J. Welles Wilder who presented it in a book called “New Concepts in Technical Trading in 1978“. The RSI or Relative Strength Index indicator of fourteen (14) periods is defined by the following formulas:
The RSI or Relative Strength Index is graphically represented by a vertical scale between zero (0) and one hundred (100). When the value of the indicator is above the value seventy (70), it means that the price of the Stock is OVERBOUGHT. In the case where the value of the Indicator is below thirty (30), it means that the price of the Stock is OVERSOLD.
On the previous graphic, we mark with a rectangle of LIGHT RED color the areas corresponding to OVERSOLD. We represent with a LIGHT GREEN rectangle the areas corresponding to OVERBOUGHT.
Within each rectangle we have included the letters “SV” within a RED CIRCLE, to name the areas corresponding to OVERSOLD. We include the letters “SC” in a GREEN CIRCLE, to name the areas corresponding to OVERBOUGHT.
In this way, we obtain the attached graph in which the indicators are overlapping: Crossing of three (3) EMAS and the RSI.
The Stochastic indicator or STOCH Index, is an oscillator type indicator was developed in the 50s by George C. Lane and is a technical indicator of market momentum that shows the relationship between the closing price in each time frame with respect to the range between the maximum price and the minimum price, during a specific set of periods.
The Stochastic or STOCH indicator of fourteen (14) periods is defined by the following formulas:
Where:
The Stochastic or STOCH index of fourteen (14) periods is represented graphically by a vertical scale between zero (0) and one hundred (100). When the value of the indicator is above the eighty (80) value, it means that the price of the Stock is OVERBOUGHT. In the case where the value of the Indicator is below twenty (20), it means that the price of the Stock is OVERSOLD.
On the previous graphic, we mark with a rectangle of LIGHT RED color the areas corresponding to OVERSOLD. We represent with a LIGHT GREEN rectangle the areas corresponding to OVERBOUGHT.
Within each rectangle we have included the letters “SV” within a RED CIRCLE, to name the areas corresponding to OVERSOLD. We include the letters “SC” in a GREEN CIRCLE, to name the areas corresponding to OVERBOUGHT.
In this way we obtain the attached graph in which the indicators are overlapping: Crossing three (3) EMAS, the RSI and the STOCH.
The Indicator MACD is defined as the difference between two (2) exponential moving averages (EMA) of different periods. The first EMA is calculated with twelve (12) periods, being more sensitive to short-term price movements, while the second EMA is calculated with twenty-six (26) periods, being more sensitive to medium-term price movements.
The MACD indicator of twelve (12) periods is defined by the following formulas:
The MACD indicator has a second component called SIGNAL. This corresponds to the exponential moving average of the MACD of twelve (12) periods used for this moving average nine (9) periods, the formula being the following:
The last component of this indicator is the MACD Histogram, which corresponds to the difference between the MACD and the SIGNAL, the formula being the following:
When the MACD line, represented by a GREEN line, crosses over the line of the SIGNAL, represented by a RED line, a BUY indication is produced.
When the MACD line, represented by a GREEN line, crosses below the line of the SIGNAL, represented by a RED line, a SELL indication is produced.
One way to confirm the MACD indication is to wait for the MACD line to cross “LINE 0” or WATER LINE up, which would confirm the BUY indication, or down, which would confirm the SELL indication.
On the previous graphic, we mark with a rectangle of LIGHT RED color the areas corresponding to SELL indication and with a LIGHT GREEN rectangle the areas corresponding to BUY Indication.
Inside each rectangle we have included the letter “V” inside a RED CIRCLE, to name the areas corresponding to SELL Indication. We include the letters “C” in a GREEN CIRCLE, to name the areas corresponding to BUY Indication.
In this way we obtain the attached graph in which the indicators are overlapping: Crossing three (3) EMAS, the RSI, the STOCH and the MACD.
Once the different areas determined in the previous sections have been analyzed, we proceed to combine the results obtained in order to establish the SIGNALX chart that is included below.
On the previous graphic, we mark with a rectangle of LIGHT RED color the areas corresponding to SELL indication. We mark with a LIGHT GREEN rectangle the areas corresponding to BUY indication.
Inside each rectangle we have included the letter “V” inside a RED CIRCLE, to name the areas corresponding to SELL Indication. The letter “C” is included in a GREEN CIRCLE, to name the areas corresponding to BUY indication.
In this way we obtain the attached SIGNALX graphic.
Once the SIGNALX chart is represented, we proceed to implement our Entry and Exit Rules included in our Trading System on the chart.
Within the SIGNALX Chart we represent with the letter “B” inside a GREEN CIRCLE, the instant in which our system indicates the BUY operation.
We represent with the letter “S” inside a RED CIRCLE, the instant in which our system indicates the SELL operation.
We represent with the letter “C” inside a BLACK CIRCLE, the instant in which our system indicates the CLOSURE of operation.
Between each indication of BUY and CLOSURE a GREEN LINE color is drawn. Analogously, between each SELL and CLOSURE indication a RED LINE color is drawn.
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