High probability Moving Average Strategy (How to use the Golden Cross and death cross strategy)

In order to take trading as a business, it is important for us to develop a strategy that works. Because whenever we're able to get a strategy that works, it makes trading easier, and we can easily describe what we understand as a business because we have been able to get a good grasp of what we have to do at every point in time. So I'm going to use this medium to welcome every one of us Today's special edition talking about a strategy that works, a strategy that tells us the direction the market is going at a particular point in time. Because when you understand the direction of the market, the job is half done. The only other thing we need to do is to look for good entries, then we get to take our trades depending on the direction the market is pointing us to. So this is a very good time for us to like this video, subscribe to this channel and share so that others can also get to benefit from this special strategy which you are going to be looking at. So this strategy, as I said earlier, is a trend identifier. It helps us to understand the direction of the market. And what we'll be looking at today is the golden cross. So what is the golden cross? The golden cross is a situation in the market when a short-term moving average crosses over a major long-term moving average to the upside. And whenever this occurs in the market, traders tend to interpret it as a sign that the market is going to be going bullish. It's a bullish signal in the market whenever we have a short-term moving average crossing over a long-term moving average. And for me, I have been using the 50 exponential moving average and the 200 exponential moving average to arrive at the golden cross. So how do we add the 2 moving averages? So you, um, go to your indicator list and you move to trend because the moving average is a trend indicator. So I go to moving average Then I have first the 50 exponential moving average, which is going to act as my short-term moving average or the fast moving average. I would make the color possibly a green and okay. Then the second one, which is my slow moving average or the long-term moving average, is going to be the exponential moving average Period 200. So 200 exponential, close shift is still 0. Then I can make this a red, and I click OK. OK. From the earlier definition, the short-term moving average is the green moving average. The long-term moving average is the red moving average, and based on the color of my charts, because I have 2 different colors on my charts, my chart has green. The green is representing the bullish market or the bullish candle, while the red is representing the bearish market or a bearish candle, as traders do call it. So where do we have a golden cross on this chart? Let's take a look at this particular chart. So this strategy is more effective on the higher time frame. So when I'm talking about the higher time frame, I'm talking about H4 and above. So that's H4, D1, W1, and the monthly chart. Those are the time frames that are more effective when we are utilizing the golden cross. So let's go to maybe the H4 for this particular analysis. So the last time we got a golden cross on this particular time frame was at this point because it was at this point that the green moving average, that's the short-term moving average, crosses above the long-term moving average, which happens to be the red-colored moving average. So at this point that we have the green trading above the red, it is definitely telling us that the trend from that moment onward is bullish. So at what point will I get to take a buy trade according to this strategy? So let's take a look at what price has done in the past. So at this particular level where we had the green covering the red or going above the red, we had this massive bullish candle. And taking a very close look at the bullish candle, it gave us a partial engulfing because it couldn't really engulf the entire body, um, of the red candle, especially the body of the green. Though some traders still assume that inasmuch as the shadow of the green still covers the red, it's still a bullish engulfing. So those particular series or set of traders is going to take this as a bullish engulfing, and that is a signal for them to take another buy trade. So any signal that points to price going up, especially the appearance of bullish engulfings or an hammer that is followed by a bullish candle, is a signal for us to take a buy. So if I have observed a golden cross on the higher time frame, say H1. So from this moment, let me just check this out. I insert, I go to shapes. So from shapes, I put the rectangle. I'm going to change this color because this is the rectangle. Edit, then I put it With a color that is a bit light and will be easier for me to trace. We still not be too light, maybe pink. Oh, this one is khaki. Okay, so let's go with this. Yeah, so I think this is better because this is going to give me the opportunity to identify this zone on a lower time frame. So the golden cross occur at this point, the green crossed over the red. So I can now move to the hourly time frame. Maybe possibly I trade on the hourly time frame. So what will I be looking out for? I will be looking for candle patterns that agree for me to take a buy. What are some of those candle patterns I will be paying attention to? Let me try to point out some of them to us on this chart. First, we had this structure. This structure meant that price first went down and then was massively rejected from the downside, pushing up. And the color that followed it happened to be a green-colored candle. This green also happened to be a bullish engulfing because it was able to cover as many as 1, 2, 3, 4, 5, 6— 6 bearish candles before it. A powerful signal that price is going to go up. I've noticed a bullish cross or a golden cross on the H4. I've come to H1. Waiting for signals to take a buy trade. So this is a very good signal for me to take a buy trade. At the close of this candle, I can take my buy, and I put my stop loss below the structure that told me I can take a buy. In this instance, this was a signal for a sell, but because the golden cross is still intact on the 4-hour time frame, I will not take this trade. I will only wait until the signal says I can buy. So I only take buy trades, strictly buy trades, in as much as the golden cross is still intact on the larger time frame. So I had a bullish engulfing here again, another signal for me to take a buy. Every bullish engulfing or confirmed structures that says I can take a buy That's when I am going to take a buy on the lower time frame that I trade. The other side of the golden cross is what we call the dead cross. What is the difference between the dead cross and the golden cross? Let's look back historically at the 4-hour time frame. So on the 4-hour time frame, at this particular point in time Yes, so you could see this particular point in time on the 4-hour time frame that the red, which is the long-term moving average, is trading above the green, that's the short-term moving average, telling me that the direction of the market at this point in time is bearish. This is the death cross, opportunities to sell only at this particular point in time. So I'm going to do the same thing like I did for the golden cross. So I go to shapes, uh, though it's still going to take the initial color, but I'm going to change that so I'll be able to understand the difference between the 2 zones. Okay, so I'm going to change the color. Object list. Okay, I think this should be the second rectangle. Now change the color from khaki to possibly another light color. Um, lemon. This lemon is looking like this. I think this is okay. Still looking like the khaki. Okay, I think this is slightly different. Okay, so this is a better color. So at this point, I can then move to the lower time frame, say the H1, and identify that same zone which happens to be here. Any bearish signals gives me a nudge to take a sell. Bearish signal is a nudge to take a sell. So at this point, I only look at taking sell trades strictly because the trend when there is dead cross is bearish in nature, just simply bearish at that particular point in time. And a very good point to take note of when you are trading the golden cross or the dead cross is that they are long-term signals. These signals do not change as fast as other signals in the market, especially if you are able to get them on the higher time frame. That's from the H4 time frame upward, as I've told us earlier. And it guarantees, to a reasonable extent, better returns on every of our investment. That's every trading opportunity we're able to cite in the market. So when you have the dead cross, like in this instance, the 2 moving averages will be acting as a resistance to price. And for those of us with very good understanding of how the support and resistance works, we know that resistance zones are zones where price are expected to move to the downside. So you treat the moving averages as resistance in the case of the dead cross, while during the golden cross you treat the moving averages as a support because at supports prices are expected to move to the upside. So that's still lending more strength or lending more support for for us to look at taking buy trades because you should not sell at support. Should be considering taking buy trades around support. And when you're able to buy around support, there is a high possibility or a high probability of we making profits on that particular trade. And another thing that is guaranteed is that our stop loss at this point is going to be as low as possible. So we are not going to be risking so much. And our expectations on the trade, which is going to be our TP, be as high as possible on that particular trade setup. So thank you very much for being a part of this special edition. So I look forward to having you around pretty, pretty soon. Thank you. Do not forget to like, subscribe, and share this video. Thank you once again.