Crypto Academy / Season 3 / Week 3 - Homework Post for Professor @cryptokraze

This is Season 3 Week 3 of Steemit Crypto Academy and I'm writing Homework Task for Professor @cryptokraze

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1)

What do you understand about the Concept of Break Retest Break Strategy? Give Chart Examples from Crypto Assets.

Like other strategies BRB strategy is designed to pinpoint the signals for buying and selling a currency pair to earn maximum profit. The BRB strategy is based on the support and resistance areas in a price action chart. The concept of BRB strategy is that we do not trade immediately after the price break, rather we wait until the price reverses back to the broken levels and moves in the previous direction again.

Support retest:

Below we can see that the currency pair is breaking the support level after sometime it goes back to the broken level, bounces from that level and then continues falling. This situation is ideal for selling:

Resistance retest:

In an upward movement after the resistance level has been broken the price goes higher for a while then comes back to the broken level continues to be around there for some time and then continues its previous movement. This situation is deal for buying

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2)

Mark important levels on Crypto Charts to trade BRB strategy. Do it for Both Buy and Sell Scenario.

As explained earlier the BRB strategy can be used to identify right points for buying and selling a currency pair. In this question I will explain my statement with charts. I am using BTC/USDT in a one day time frame.

Sell entry Scenario:

For identifying the right signal for selling we will follow this criteria

  • Make sure that the price movement is in the downtrend
  • Wait until you can mark a clear support level as I marked in the below chart.
  • After the price breaks the support level waits for a bearish candle or swing.
  • As the price retests the support level and breaks the swing level it will start to move downward now place the sell order.

Buy entry scenario:

Buy entry scenario follow these criteria:

  • Make sure that the market is in up-trend
  • Wait until you are able to draw an accurate resistance level.
  • When the price movement continues to move up and break the resistance level, wait for a bullish candle that breaks the swing point.
  • Once the price breaks the swing place a sell entry

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3)

Explain Trade Entry and Exit Criteria for both Buy and Sell Positions on any Crypto Asset using any time frame of your choice (Screenshots Needed)

Entry Criteria for Buy Position:

  • First of all, we should keep in mind that the market is going to approach the resistance level placed on the chart.
  • Focus on if the market breaks the resistance level, comes down (retest) and then again make a high point. 
  • Now if the market breaks the resistance level or previous high point then this is a valid break and we can place a buy entry just after the recent break as shown below in the chart.

Buy Entry Criteria for Sell Position:

  • First of all, we should keep in mind that the market is going to approach the Support level placed on the chart.
  • Focus on if the market breaks the Support level, retest the support level and start moving down and break the recent low level as well to make a valid break. 
  • That’s it, now we can take a sell entry just after the recent low level is broken. 

Trade Exit Criteria for buy position:

By placing a stop loss order we prevent ourselves from making big losses. The trade automatically shuts off after the stop loss limit is reached. After the sell entry is placed the exit point depends on one’s loss bearing capacity. Profit and stop loss levels should be set immediately after the sell entry is made. For beginners it is recommended to go with 1:1 but professional traders often go with 1:2 ratio. In which profit is 2 times the loss. This is a 1;1 profit loss level.

  • We should always place a stop loss level to avoid big losses because sometimes trades can also go in the wrong direction. 
  • We should also place a take profit level on the chart to take profit in the form of 1:1 ratio or 1:2 ratio. It is recommended from the professor that we beginners should set 1:1 profit
  • The Stop loss level which we will place on the chart should be below the resistance level and when the price crosses that stop loss, that setup will become invalid and we will wait for another setup to make an entry. 
  • The Take profit level should also be marked on the chart with 1:1 RR and when the price meets the Take profit level then we can take the profit or exit the trade.

Trade Exit Criteria for Sell Position

  • We should always place a stop loss level to avoid big losses because sometimes trades can also go in the wrong direction. 
  • The Stop loss level which we will place on the chart should be placed above the Support level price has broken. 
  • And if the price crosses that stop loss, that setup will become invalid and we will wait for another setup to make an entry. 
  • The Take profit level should also be marked on the chart with 1:1 RR and when the price meets the Take profit level then we can take the profit or exit the trade.

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4)

Place 2 demo trades on crypto assets using BRB Strategy. You can use lower timeframe for these demo trades (Screenshots Needed)

Trade 1: TRX/BNB

When I opened the market was in this upwards position I identified the resistance line and waited for another peak

After some time I noticed another peak. I waited for the retest to place the buy signal. As soon as I noticed the retest I placed the buy order. The screen shot is of the whole trade and you can see that the buy signal was identified rightly. The trade proved to be a success based on the BRB strategy.

Here is the screenshot of my own Binance account where I bought TRX coins with BNB.

Trade 2: Doge

For the second trade when I entered the market it was in downtrend. I recognized the support level and waited for the retest to place the order.

Here is the screenshot of my own Binance account where I bought Doge coins with USDT.



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Conclusion

BRB is a very helpful strategy in technical analysis and trading. It is very accurate and helps us determine the right selling and buying levels. Many traders use this strategy. I personally liked this strategy as it is very easy to understand and everything revolves around the support and resistance levels.

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Dear @salmanwains

Thank you for participating in Steemit Crypto Academy Season 03 and making efforts to complete the homework task. You got 8.5/10 Grade Points according to the following Scale;

CriteriaGrade Points
Presentation Style2/2
Content Quality1.5/2
Originality1.5/2
Relevance with Topic1.5/2
Practical Approach2/2

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Key Notes:

  • You have marked support and resistance levels correctly which are the base of BRB setups.
  • In question no 03, your entry points are bit early because we enter in trade after 2nd break of the recent swing points.
  • In the last question, I wanted to see if students picked this strategy. Both trades are picked at right level which is good to see and shows you understood the strategy.
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    We appreciate your efforts in Crypto academy and look forward for your next homework tasks.

Regards
@cryptokraze