Trended and Blended by CoffeeShopCrypto
What up guys and welcome to the CoffeeShop. This is your host and "baristo", Eric.
This is a simple little set of 3 moving averages. Smoothed moving averages that you can use in the 10 /28 strategy, or any other strategy you choose.
Among themselves there is nothing special about these moving averages, but because of their settings they will help you find entries for long and short positions and for divergence trading.
These moving averages have conditional colors built into the code, using the pinescript "color from gradient" feature.
All three moving averages, are green when they are all lined up in a bullish form.
All three are red when they're all lined up in a bearish form.
And they are colored Gray when price action and the moving averages are mixed up in any way.
But this is not enough to help you determine whether you have a true trend or not also it is not enough to tell you whether you have a strong or weak trend so there's more.
Add to this color command, the candles are colored ONLY when there is a true uptrend or downtrend.
If you believe for any reason that price action is telling you this is going to a a short term trend, you can
wait for your long or short color confirmations and then drop down to a lower timeframe to make your trades.
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for a strong uptrend you would look for the candles to close bullish above all three green moving averages that were already lined up. This would be a strong uptrend. If price action closed below all three downward lined up moving averages they were all red and your candle is red then you have a strong downtrend.
Week Trend
However if your candle closes bearish and it closes red below a mixed set of moving averages then you have a week downtrend.
The same applies if you have a bullish closing candle but your fast and medium moving average are facing up however they are below your slow moving average. You may have a green line up however if you're moving averages are mixed up then you have a weak trend.
Summary
In short a strong trend is when you close above or below moving averages that are lined up in the same direction and they are not mixed in any way. A weak trend is when you close above or below your fast and medium moving averages as they're lined up in that same direction however they are on the wrong side of your third moving average.
When you have a weak trend you should be scalping and when you have a strong trend you should be able to ride that trend more appropriately.
Additional Note from the CoffeeShop Crypto:
"Watching price action is one thing. And you can be great at it but it's easy to get caught in a liquidity trap or potential stop hunts. Obviously you won't enter a trade unless there is enough volume behind that to show there's actually TRUE momentum in the market, right?
Setting your RSI MA to VWAP means you can see when a candle closes above (going bullish) or below (going bearish)."
If you see price action going bullish on your chart and the RSI has a good move, you need to make sure your Heiken Ashi candle opens below the VWAP MA and closes above the VWAP MA. This means there is true volume in the trade.
If the Green HA candle never closes above the VWAP MA, you should not enter long.
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Comments 1
The new update is a major change and helpful. I almost went the wrong way on a break. But when you combine all these tools together you can really become a whale . I’m just trying to work on precision exits for reversals. Ughh