I have been trading cryptocurrencies for 10 years and professionally for 8 years, totaling over 2000 days. Starting with an initial capital of 200,000, over the years, I have experienced various pressures, pains, and confusions. Ultimately, I gained profound insight, simplified my trading techniques, and in just three years, I easily withdrew 48 million in the crypto space!
Achieving continuous and stable profits to support my family through trading! I have also made a profit from a house in Shenzhen, a car, and have some savings and assets.
I have experience in long-term, short-term, ultra-short, and swing trading; I have tried almost all types of methods.
This article reveals the 'Holy Grail Trading Strategy' | A trend trading system that only uses two indicators: ADX + EMA low-risk high-win-rate trend-following method.
Learning the Holy Grail Trading Strategy will set you on the path to finding winning trades. The goal of the Holy Grail stock trading strategy is to help you discover how to achieve consistent profits through simple trading setups. Additionally, we will discuss facts contrary to some widely circulated trading 'maxims' that there is no such thing as a Holy Grail in trading.#加密市场反弹
In trading, most traders view potential profits as the primary indicator of success or failure. Wanting to make money is not wrong. However, professional traders have a different mindset; they focus more on managing existing capital. If your goal is to double your wealth (or profits) overnight, your survival time in the trading game will not be long.
A group of traders focuses on finding the 'Holy Grail', while another group pays more attention to risk management. Ultimately, merely focusing on profits does not make you profitable. Both profits and losses need to be managed effectively. By focusing on the trading process and the market, you are likely to become a consistently profitable trader.#币安HODLer空投EDEN
Let’s take a look at the truth about the Holy Grail Trading System and outline the trading rules of financial expert Linda Raschke, who focuses on commodities and futures trading.
Does a 'Holy Grail' exist in trading?
There is no Holy Grail in trading.
Trading is a skill that can be learned, but it is not a guaranteed 'magic pill' for wealth.
Naturally, you might wonder: What is the Holy Grail Trading Strategy?
The Holy Grail stock trading system is one that can generate profitable trades regardless of market conditions or the asset classes being traded. It is a theoretical concept - it does not exist in practice - but it can help you design a trading strategy with greater profit potential, making it your own exclusive strategy.
No matter how you adjust your entry rules or which combination of indicators you use, you will not find a Holy Grail. Trading is inherently risky. However, risks can still be managed effectively.#加密ETF十月决战
Some traders may point out that arbitrage in trading can lead to risk-free positions. However, arbitrage is not a strategy that ordinary day traders should pursue. Unless you have the algorithms of the high-frequency trading firm Virtu Financial, which has only one losing day in five years. Even more astonishing is that according to Bloomberg data, Virtu Financial set a record for 'zero loss days' in 252 trading days of 2014.
Virtu Financial is one of the world's largest high-frequency trading and market-making firms, providing bid and ask quotes and trades in stocks, commodities, forex, options, fixed income products, and other securities across more than 200 exchanges, markets, and dark pools, covering over 11,000 stocks and other financial products. The company uses proprietary high-frequency trading strategies based on big data to trade a large volume of securities.
We believe the probability of finding life on Mars is much higher than the probability of finding a Holy Grail Trading Strategy.
Three reasons why there is no Holy Grail trading strategy.
In the world of trading, there is no 'one-size-fits-all' method.
For example:
Trend-following strategies perform poorly during market volatility.
Secondly, the market constantly changes.
"The current market is the same as five to ten years ago, as it constantly changes, just like back then." - This is a trading quote by top trader Ed Seykota.
Price action is like the ebb and flow of the ocean, constantly changing in both intensity and duration.
Third, there is no magical trading formula, as no one can prepare for all market situations. The 'Efficient Market Hypothesis' is incorrect because if markets were indeed efficient, there would be no way to profit.
These three reasons clearly illustrate why there is no Holy Grail in trading.
Even price action trading strategies have their own risks.
Price action is not a trading Holy Grail.
Don't get me wrong, mastering price action trading strategies is indeed very useful.
However, market prices are full of noise, and filtering out the noise can be very difficult.
We are not saying you cannot trade solely based on price action.
On the contrary.
Holy Grail Trading Strategy
This is a very simple trading setup that applies to any variety (stocks, forex, commodities, cryptocurrencies, etc.). Furthermore, to show you that you can find an edge outside of price action trading strategies, the Holy Grail Trading System uses two technical indicators.
First, let's list the trading tools required for the Holy Grail Trading Strategy:
1. Average Directional Index - ADX
2. 20-period Exponential Moving Average (EMA)
Please refer to the chart below:
The ADX indicator is a trend-following indicator used to measure trend strength. Theoretically, the stronger the trend, the higher the ADX reading. Therefore, ADX is a non-directional indicator or a strong trend indicator.
The ADX indicator consists of three lines: the ADX line, the +DI line, and the -DI line. The +DI line and -DI line determine the direction of the trend. When the +DI line crosses above the -DI line, the market enters an uptrend, and when the -DI line crosses below the +DI line, the market enters a downtrend.
The ADX line is used to determine the strength of the trend: above 25 is usually a weak trend, between 25 and 50 is a strong trend, and above 50 is a very strong trend.
ADX can also be combined with oscillators to reduce false signals. For example, if ADX shows the market is trending, then there’s no need to consider overbought and oversold conditions in RSI or stochastic indicators.
Here’s how ADX works:
If the ADX is continuously rising while the price is also moving upwards, it indicates a strong bullish trend.
On the other hand, if the ADX is continuously rising while the price is moving downwards, it indicates a strong bearish trend.
Please refer to the ADX chart below:
The Holy Grail Trading System aims to capture the first pullback after a strong trend (up or down). The general rule is that the first pullback in a bullish or bearish trend is the most profitable trading setup.
Top trader Linda Raschke points out that the Holy Grail Trading Strategy provides a low-risk entry point. Secondly, the outcomes of this trading setup are highly predictable, and the following two scenarios are most likely to occur:
1. Retesting previous swing highs (or lows). The profit potential in this case depends on how far the pullback goes.
2. Secondly, the main trend recovers and begins a new upward (downward) continuation trend.
Even the so-called 'Holy Grail System' has some trading rules.
Next, we will outline the Holy Grail trading rules (for buy signals).
Step #1: The 14-period ADX must be above the 30 level and continuously rising.
The first condition involves measuring trend strength.
An ADX reading above 30 is sufficient to indicate that the price is undergoing a strong trend. If we wait too long, and the ADX reaches a higher reading, the trend may have already extended too far, and our entry may be too late.
An ADX reading above 30 is a good way to determine the presence of a strong trend and differentiate between weak and strong trends.
Please refer to the Tesla stock chart:
Step #2: Look for price pullbacks to the 20-period exponential moving average (EMA).
The second Holy Grail trading rule involves price action.
We wait for the first pullback to the 20-period exponential moving average. Remember, we need to monitor the first pullback to the exponential moving average, not the second or third.
It makes sense that the ADX follows price action and declines. Therefore, do not panic when the ADX moves down during a pullback. However, if the ADX falls below the 30 level during a pullback, that is a warning signal.
The ADX must remain above the 30 level to confirm that the current trend is strong enough to maintain its momentum.
Step #3: Buy when the breakthrough touches the candle high of the 20-period EMA.
As an entry trigger point, we will use the first candle high that touches the 20-period exponential moving average. Breaking through that candle high will trigger our entry to buy.
We are systematizing everything with trading methods. Having a systematic strategy foundation is better than adding arbitrary elements. The first trading advantage of this approach is that you can better quantify risk.
Remember that to keep the Holy Grail signals valid, we must stay above the 20-period exponential moving average (EMA).
Let's define stop loss and take profit strategies.
Step #4: Set stop losses below the pullback low and use trailing stops to lock in profits.
Protective stop losses should be set below newly formed swing lows. In other words, you set your stop loss below the low reached after the price pullback.
Secondly, there are two methods for setting take profit and stop loss in forex trading:
First, set trailing stop losses below the 20-period exponential moving average, following the trend.
Secondly, you might consider taking profits at recent swing highs.
Please note that when we experience minor pullbacks (like in the example above), it is best to simply use trailing stops to lock in profits.
Note*: As long as the ADX remains above the 30 level and all other rules are followed, subsequent trades can be made at the 20-period exponential moving average.
The sell (short) signal for the Holy Grail strategy works opposite to the buy (long) signal.
This is an example chart:
The Holy Grail trading strategy can help you quantify risk within an established trend. Combined with the ADX indicator, we can achieve a well-structured trading system for entry. Quantifying and managing risk is one of the most important things for traders.
Conclusion - Holy Grail Trading System
In fact, there are no Holy Grail trading methods in the market. All trading carries a certain degree of risk. A simple and robust plan, along with appropriate risk management, is the 'Holy Grail' of trading. Once you join the compounding effect of profit multiplication, you can gain a different perspective on trading.
Profitable trading depends entirely on your mindset, ability to acquire information, and ability to stick to your basic trading principles. Of course, you need an edge, but without the right mindset, even the most profitable trading strategies can lead to losses.
Therefore, here is a brief summary review of the Holy Grail Trading Strategy:
1. Use the ADX indicator to measure trend strength.
2. Buy on the first pullback of the new trend.
3. Use price action and the 20-period EMA to determine entry timing.
4. Use trailing stops to lock in profits.
Finally, I would like to share a set of iron rules for trading cryptocurrencies, hoping to help everyone!
1. Position adjustment logic. Now is not the time to cast nets everywhere; positions should be concentrated on leading coins and mainstream tracks. The fantasy of small coins rebounding should be put aside, and non-core assets should be avoided. Focusing positions allows you to truly benefit in a big market.
2. Market environment signals. On a macro level, the expectation of interest rate cuts is likely to materialize, coupled with the WLFI's hot spots, the market sentiment is clearly heating up. This combination often guides funds into the active cycle of altcoins, which requires high attention to the rhythm signals.
3. Dynamic of major coins. BTC: Currently under pressure from large funds (whales), with weak short-term upward momentum. ETH: Currently undergoing a stage of chip turnover; after consolidating, it is expected to start a new round of upward trend. 👉 These two major coins remain the anchor of the market. Once the trend is confirmed, the altcoin sector will truly explode.
4. Current core narrative. In the short term, the WLFI ecosystem is the strongest mainline. Funds will generally revolve around this track, and related targets will naturally become hot spots. Keep an eye on this main line and avoid chasing coins that have no story.
5. Opportunity focus tips. The 'One Fish, Three Eats' strategy of WLFI is being favored by the market, and many refer to it as the 'windfall' of this wave of trends. Whether you can capture the dividends depends on whether you can catch the core targets within the ecosystem.
The martial arts secrets have been given to you; whether you can become famous in the martial world depends on yourself.
Everyone should save these methods. If you find them useful, feel free to share them with more people around you who trade cryptocurrencies. Follow me for more insights into the crypto world. After the rain, I will hold an umbrella for you! Follow me, and let’s walk together on the path of cryptocurrency!