Oversold RSI with Tight Stop-Loss- Coinrule Strategy of the Week 4
This week we look at a strategy that utilises the RSI to find appropriate entries for trades. To close trades, the strategy waits for the price to either appreciate by 7% or depreciate by 1%. The idea behind this is to cut your losers fast and let your winners ride.
Link to TradingView script:
https://www.tradingview.com/script/Fu...
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0:10
Hi there, and welcome to Coinrule’s fourth strategy of the week video. This week’s strategy is similar to our last video in the sense that it won't use trading view signals. You'll still be able to back test the strategy on Coinrule using TradingView, but you won't actually need to connect Conrule to TradingView to run it.
00:28
An advantage of this is that you'll be able to utilize that “any coin” option on Coinrule meaning that you can run the strategy across all coins in the market, and not just on one specific coin.
00:38
Another advantage of this is that you won't need a paid TradingView subscription to run it on Coinrule. This strategy is even simpler than our last video. Similar to last week’s strategy, it uses the RSI or relative strength index to enter trades. However, this is the only technical indicator using the strategy. The indicator works by measuring the speed and change of price movements to determine whether a coin is oversold, indicating a good entry point or overbought, indicating a point of exit or an entry for a short position.
01:09
The RSI oscillates between zero and 100 and is traditionally considered overbought when over 70 an oversold went below 30 As you can see up here. As mentioned, to enter trades, the strategy uses the RSI to anticipate good points to enter positions to pick the right moment to buy. The strategy enters a trade when the RSI falls below 30 indicating that the coin is oversold and primed for a trend reversal.
01:35
The exit conditions are also very simple. The strategies take profit condition is when the price appreciates 7% from the point of entry. The position also maintains a tight stop loss and closes the position if the price depreciates 1% from the entry price. The idea behind this is to cut your losing trades fast and let your winners right.
01:55
Lastly, I'm going to show you how to run the strategy on Coinrule and also back tested on TradingView. First, I'm going to show you how to back test the strategy on TradingView, you'll need to find the strategy on our TradingView page.
02:06
This is the name of it here. I've added a direct link to this in the description of the video so you don't need to find it manually. Scroll down and you'll find a description of the entry and exit conditions. This is what we've already been over but it's here for your reference if you want to look at it again. Scroll down and click Add to favorite indicators. I've already done it but just press this button here and come to the chart that you wish to run on.
02:26
So I'm going to test on chainlink on the daily timeframe. This is important because based on our back testing data, the daily timeframe is the most profitable for this strategy. Feel free to experiment with other timeframes, but we recommend the daily. Come to your favourites under indicators here. Scroll down and find oversold RSI with tight stop loss by Coinrule, click it, and it'll be added to the chart.
02:49
So you can see there were 13 Close trades. This strategy made $391 with $1,000 starting capital with 61.54% of trades being profitable. It's important to know if this is just for one coin. And as I mentioned before, you can have the strategy run across all coins in the market using the any coin operator.
03:08
So come to Coinrule and feel free to pause the video here and just copy the strategy. This is, this is the exact strategy that we've just been over. And important specification is the date I've specified a timeframe of one day here because as I said before, this was the most profitable based on our back testing data.
03:24
So just copy the strategy. If you're happy with it, click launch. And your strategy is now live. An important thing with this strategy is that I would recommend to come to your settings here and come to the market cap settings here and select Do not buy coin to market cap below 50 million in my personal experience. This has made the strategy even more profitable. But again, you can experiment with other options. Thank you very much for listening to this strategy, the video. Really excited to see what you create. Thanks.