OPEN-SOURCE SCRIPT

Scalping Dips On Trend (by Coinrule)

Coinrule's Community is an excellent source of inspiration for our trading strategies.

In these months of Bull Market, our traders opted mostly on buy-the-dips strategies, which resulted in great returns recently. But there has been an element that turned out to be the cause for deep division among the Community.

Is it advisable or not to use a stop-loss during a Bull Market?

This strategy comes with a large stop-loss to offer a safer alternative for those that are not used to trade with a downside protection.

Entry

The strategy buys only when the price is above the Moving Average 50, making it less risky to buy the dip, which is set to 2%.

The preferred time frame is 1-hour.

The stop-loss is set to be quite loose to increase the chances of closing the trade in profit, yet protecting from unexpected larger drawdowns that could undermine the allocation's liquidity.

Exit

Stop loss: 10%
Take Profit: 3%

In times of Bull Market, such a trading system has a very high percentage of trades closed in profit (ranging between 70% to 80%), which makes it still overall profitable to have a stop-loss three times larger than the take profit.

Pro tip: use a larger stop-loss only when you expect to close in profit most of the trades!


The strategy assumes each order to trade 30% of the available capital and opens a trade at a time. A trading fee of 0.1% is taken into account.
Bitcoin (Cryptocurrency)Bullish Patternsbullmarket2020bullmarket2021cryptoEthereum (Cryptocurrency)Moving AveragesTrend AnalysisVolatility

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