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Verge Trading Strategy – Amazing 2-Period RSI Day Trading System
The Verge trading strategy is built around the 2-period RSI indicator that will allow you to capture intraday price movements. This cryptocurrency day trading system will give you the opportunity to have the constant technical precision that it’s so important for your success.
Our team at Trading Strategy Guides is working hard to put together the most comprehensive PDF guide for different cryptocurrency strategies. Previously, we covered Tether Cryptocurrency Strategy, which is a cryptocurrency that is pegged to the US Dollar.
Trading Verge privacy coin on the 5-minute chart can be accomplished if your technical indicators use the right settings. The 2-period RSI indicator produces tons of signals and is noisier. However, even though that might be true, bear with us for one second.
If you’re familiar with how technical indicators work, generally the lower the period, the more noise you’ll get.
This is what we have done to attempt to filter some of that noise out
We tweaked not just the RSI parameters, but we also played around with the overbought and oversold readings and found out that by using a 95 RSI reading for overbought and 5 RSI reading for oversold condition, we get more accurate day trading signals.
Basically, we’ve stretched the overbought and oversold band parameters. Since the RSI indicator oscillates between 0 and 100, we’ve only taken the very extreme levels for overbought and oversold.
Moving forward, we’re going to explain what cryptocurrency Verge is. We’ll also share the key trading rules to day trading cryptocurrencies.
What is Cryptocurrency Verge?
Verge is a decentralized currency designed for people who value privacy. In other words, Verge is another privacy cryptocurrency the same like Monero which currently is still regarded as being the world’s number one privacy coin.
The key feature of the Verge coin is that it improves the Bitcoin blockchain by using multiple anonymous centric networks such as ToR and I2P. Originally Verge was created in 2014 under the name Dogecoin Dark, but it was re-branded in 2016 as Verge coin.
At the moment of writing this step-by-step cryptocurrency guide, Verge is a top 100 cryptocurrency having a total market cap of more than $200 million.
The reason why our team at TSG chose to develop the Verge cryptocurrency strategy PDF is because PornHub, one of the largest websites on the web, has started accepting cryptocurrency Verge for a new method of payment. Don't forget to read our article on the best crypto's for 2019.
Now, before we outline a method on how to buy cryptocurrency Verge, we always recommend taking a piece of paper and a pen and note down the rules of this day trading cryptocurrency strategy.
In this demonstration, we’ll look at the 'buy' side.
Verge Cryptocurrency Strategy PDF
When you build a trade setup, you always have to have an idea in your mind of the strategy you want. From there, you can use the right indicators to help guide you. With our day trading cryptocurrency strategy, we only look to take trades in the direction of the main trend.
Now that we know what our goals are, we can choose a moving average to help us determine the trend. The best day trading indicator to gauge the intraday trend is the 20-period moving average.
So in addition to the RSI indicator, we also use a 20-period EMA.
These are our trade criteria for the day trading cryptocurrency strategy:
Step #1: Trend direction is given by applying the 20-EMA on the 1h chart. For uptrends we want the price to trade above the 20-EMA.
When day trading the cryptocurrency market, it’s always best for your trades to align with the higher time frame trend.
This will increase the probability of your trades, and you’ll always have the potential to make much bigger profits because when a trend is set in motion, it will continue to stay in motion for longer than you can expect.
After we’ve determined the trend, we’re going to switch to the 5-minute chart and look for specific bullish trade signals.
Step #2: How to Buy Verge: Buy when the 2-period RSI indicator crosses below the oversold 5 level.
We have stretched our oversold reading all the way down from the normal 30 level to the 5 level. This way we’ll ensure that we take only quality trade signals and you’ll notice that the RSI indicator won’t enter into oversold reading that often.
The moment the RSI indicator drops below the 5 level, wait for the respective candle to close before buying Verge coin. Waiting for the candle close will ensure that the RSI indicator has indeed broken below the 5 level.
An RSI reading below the 5 level is pretty extreme and more often than not the Verge price should shoot up ensuring a very little to no drawdown.
This brings us to the next important thing that we need to establish for our Verge cryptocurrency strategy PDF, which is where to place your protective stop loss.
Step #3: Place Protective Stop Loss below the intraday support level. Move your SL to BE or below the trigger candle once we break above 20-EMA.
The ideal place to hide your protective stop loss is below the first intraday support level. However, when managing the risk on day trades we want to take it one step forward and move the SL to BE as soon as the Verge price breaks back above the 20-EMA.
A common approach to manage your risk and adjust your stop loss is to move it at breakeven once a key technical level has been broken. Psychologically, it’s quite appealing to move the stop to break even in order to enjoy the feeling of removing the risk off the table.
Last but not least, we need to define where we take profits when trading Verge coin.
Step #4: Take Profit once the 2-period RSI indicator crosses above the 95 level.
Every trade requires a take profit target, at some point. The easiest part was always getting into a trade, but the most important part remains where you get out since that determines your profit or loss.
You can close a trade based on several technical factors, and since we had such success with our entry trigger conditions, we decided to use the same rules for our take profit strategy.
So, take profit once the 2-period RSI indicator crosses above the 95 level, showing an extreme overbought reading and a possible reversal, in which case we want to be out of the trade.
**Note: The above was an example of a BUY trade using the Verge trading strategy. Use the same rules for a SELL trade – but in reverse. In the figure below, you can see an actual SELL trade example.
Conclusion – Day Trading Cryptocurrency Strategy
Day trading the cryptocurrency market can be very handy taking into consideration the high volatility that's so predominant with this new asset. The cryptocurrency market is known to produce wild daily swings of 20%, 30% and even 50%, which is a paradise for the astute daytrader. Learn how to day trade bitcoin in our best bitcoin strategy here.
The most rewarding day trading cryptocurrency strategy is the one that also incorporates the higher time frame trend. You eliminate a lot of the bad trade signals by using a multi-timeframe strategy that only has the goal to take trades in the direction of the predominant trend.
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