In this video, I’m going to share with you a highly successful trading strategy that is trading the V-WOP on Bitcoin, and we’re actually in a live trade right now, so we’re going to see this playing out. But, how do you actually implement this strategy? So, usually, what I look for is some type of volatility, okay? So, whether it’s speed to the upside or the downside, and then you see some consolidation, and typically a flat zone like we are in right now. You’ll see this happen over and over again. It doesn’t happen every week, but usually, it’ll happen at least one to two times a month, whether you’re looking at Bitcoin or you’re looking at other assets. So, what I’ll do is I will look for this.
Oh, look, just so you have context. We had a really big move out of consolidation, probably at the bottom of the bear market down here, big move up. We’re probably a little bit overextended right now, regardless. So, my point of view and thesis going into this trade is we just had a really big run up, and we’re now at resistance that we had right before FTX news was announced, and now we’re trading right back up there. So, if I were to guess, I think about the probabilities and the odds of a slight correction, and I could see more of a Bear Flag type of move. And my overall thesis is that we would head up higher, okay?
But, regardless, this strategy – it’s important to think that way, understand what has already happened, where did we trade to, are we hitting resistance now, and what am I putting the odds in? I’m putting the odds to the short side, but I still believe in the midterm, we’re probably likely heading higher. But I think, as of right now, I’m putting more probability towards the short side. So, it’s important to understand the overall context of the trade and where it’s at, and likely what’s going to progress next, not just what you really believe is going to happen.
You have to have a certain time frame in your mind, or else, like, you know, if I think price is going up midterm, I’m not going to go long right now because now is not a great entry for that. But, now is a great entry for a short, and I’ll show you why. So, what I would do is I would grab the anchor V-WOP, which you can do so just by clicking the line next to the trend line, anchored V-WOP, and I will look for after we had the big candle up, or if it’s going down, I will then put the V-WOP right towards the base of the candle, the next candle after the big, massive candle that had the big, usually topping tail or bottoming tail. So, I’ll put the V-WOP here, as you can see, it goes right across as a volume-weighted average price, so it gives you a nice range and channel.
And what the strategy is, is when you come outside of the V-WOP, which I wouldn’t have traded here or here because we don’t have consolidation.
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