I think the biggest problem of new traders is they enter a trade, the market hit the stop-loss and then reaches the take-profit target.
Have you ever experienced this in your trading life?
I am 100% sure, you already faced this problem and some of you're still facing this problem.
Today, I will share how you can use the combination of RSI and Liquidity to get the best entry.
Why Your Trade Always Hit Stop-Loss?
When Bitcoin dips to a support level, most people enter a Long Position and set a Stop-Loss below the recent wick.
What I learned is Bitcoin always takes all the Liquidity/Stop-Loss below the wick before starts bouncing. For example, You can check the below screenshot, Bitcoin dipped to the 25.5K Support Level then after a few hours Bitcoin dipped again to take all the Liquidity/Stop-Loss below the 1st wick.
If you already entered a Long position and SL is set below the wick, chances are very high your position will be stopped out before reaching the Take Profit price.
Wait For Confirmation Before Opening Position
Once Bitcoin dips to a support level, patiently wait for the second dip below the first wick and make sure RSI is higher (Bullish Divergence) on the 2nd wick compared to the 1st wick.
For example, you can see in the below screenshot, Liquidity/Stop Loss Taken below the 1st Wick and Bullish RSI Divergence is also visible.
How To Decide When To Open a Position?
Once the #Bitcion takes the liquidity below the first wick and Bullish Divergence is visible, you can enter a long position. You can also wait for the candle close and set SL just below (or 0.5% below to be safer) the 2nd wick.
In case, if you're ready to take the risk to get a better entry, you can place an order just below the first wick and set SL around 1% - 2% below the first wick. This can be very risky but can give you a perfect entry.
You can see in the screenshot below, Bitcoin bounced 8% after taking the liquidity.
Here's another example, Bitcoin bounced almost 10% after taking the liquidity.
If you follow the combination of Liquidity + RSI properly, you can easily convert $100 To $1000+ or $1000 to $10K+.
Sometimes you can also find BTC Short entry using this method but most of the time this trick works only for finding perfect Long entry.
I said the combination of Liquidity + RSI has 100% WinRate but still you should trade responsibly because sometimes, the market reacts to news and no chart works when the market dumps or pumps because of bad news.
I haven't tried this method on altcoins because most of the time altcoins follow Bitcoin. Now, This short article has come to an end. If you found this article helpful please like, comment, share, and follow. #BinanceTournament
