M1 and H1 TF Boom and Crash Indices Spike Catching And Trend Follow System

 

This strategy is easy to use and analyze. It is based on market price pattern detection in high time frame. We make analysis in H1 time frame and find entry in M1 time frame.

 

Let us start with analysis in H1. By making analysis in H1, we use support and resistance concept, trend line concept, and rising and falling wedge.

1. Support and Resistance

A support means a price zone where buyers are expected to be strong enough to turn a downtrend. Conversely, a resistance marks a price zone where sellers might be able to reverse an uptrend.

 2. Trend line

Trend lines are easily recognizable lines that traders draw on charts to connect a series of prices together or show some data's best fit. The resulting line is then used to give the trader a good idea of the direction in which an investment's value might move.
A trend line is a line drawn over pivot highs or under pivot lows to show the prevailing direction of price. Trend lines are a visual representation of support and resistance in any time frame. They show direction and speed of price, and also describe patterns during periods of price contraction.

3. Rising and Falling Wedge

A wedge pattern can signal either bullish or bearish price reversals. In either case, this pattern holds three common characteristics: first, the converging trend lines; second, a pattern of declining volume as the price progresses through the pattern; third, a breakout from one of the trend lines. The two forms of the wedge pattern are a rising wedge (which signals a bearish reversal) or a falling wedge (which signals a bullish reversal).

Rising Wedge

This usually occurs when an index’s price has been rising over time, but it can also occur in the midst of a downward trend as well.

The above figure shows the rising wedge on Crash 500 H1. After finding the rising wedge, the market has made a long down move momentum.

The trend lines drawn above and below the price chart pattern can converge to help a trader or analyst anticipate a breakout reversal. While price can be out of either trend line, wedge patterns have a tendency to break in the opposite direction from the trend lines.
Therefore, rising wedge patterns indicate the more likely potential of falling prices after a breakout of the lower trend line. Traders can make bearish trades after the breakout by selling the security short or using derivatives such as futures or options, depending on the security being charted. These trades would seek to profit on the potential that prices will fall.

Falling Wedge

When a security's price has been falling over time, a wedge pattern can occur just as the trend makes its final downward move. The trend lines drawn above the highs and below the lows on the price chart pattern can converge as the price slide loses momentum and buyers step in to slow the rate of decline. Before the lines converge, price may breakout above the upper trend line.

When price breaks the upper trend line the security is expected to reverse and trend higher. Traders identifying bullish reversal signals would want to look for trades that benefit from the security’s rise in price.

Finding The Best Entry: M1 TF

We find the entry in lower time frame. In our analysis, we use 1M TF for better catching spikes. 

1. For catching spikes

   After finding a rising wedge and the current market price is found on either resistance or on trend line in H1 TF, switch your chart on lower time frame, preferably 1M to find a good entry. The below is the figure in 1M TF to find the better entry

The yellow dot is representing the better entry for trading a long down momentum on Crash 500, 1000.

The tools used in M1 are Ribon, support and resistance n main chart. Ichimoku Hyo(parameters:9,26,53. Color: Red, Blue, None, None, None), RSI( Period 5, apply to close, style: yellow, Level: 10,90), MACD(12,9,26. Apply to close, Main: none, Signal: Red), Alligator and Spike Shower in window 1.

This system wins 98% for trading boom and rash indices. And also while trading remember money management and trading plan.

Download the system for Boom and Crash Spikes and Trend Follow

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