- December 18, 2020
- Posted by: virtualxstore
- Category: trading
How to use all the features of Smart Trade to perform a scalp trade
Bitcoin is very bullish at the moment due to recently breaking it’s All Time High.
We can capitalise on this bullish momentum and aim to perform a scalp “long” trade during a period of consolidation on the low time frame, 15 minute chart.
On the chart below, you’ll see a trade idea with a risk to reward ratio of approximately 2 to 1, that is we clearly define our risk of $1 loss for a potential $2 reward.
This blog post will show you how to capitalise on a trade idea using most of the Smart Trade features 3Commas has to offer!
The green dashed line on the chart at approx $23200 marks the high point of the local consolidation range that price is bouncing from. The red dashed line represents our stop loss at approx $21800 at the bottom of the lowest candle wick since entering the consolidation zone.
Our possible entry is denoted with the yellow dashed line at approx $22280 which has proved a tentative short term support where price has wicked down and bounced from.
Additionally, the RSI indicator is beginning to show Bitcoin is approaching oversold and most likely due a short term bounce.
Ideally this sort of trade would be created on a Futures exchange to take advantage of leverage, however, creating it on a Spot exchange will work as well.
Smart Trade setup
Click the Smart Trade (1) menu option, and select the Exchange account with your funds, choose USD or USDT for your Market currency and then BTC/USD or BTC/USDT for your Trading Pair (2):
Now choose the Smart Trade (3) trade type, this allows you to buy a coin you don’t own at a low price to sell it for a profit at a higher price, known as a “long” trade:
Here you will see the controls that will allow you to create the trade to the specifications we outlined in our Trade Plan. You set your Entry (4), Take Profit (5) and Stop Loss (6) criteria on this part of the page:
Creating our Entry order, enter the Price (7) we ascertained in our Trade Plan earlier, $22280.
Turn on the Trailing Buy feature and set the value to 0.05%, as price may experience a sudden dip and “wick” back up, we can take advantage of this with trailing buy as it may get our trade a much better entry price!
Enter the Total (8) amount of funds to use for this trade, we are using $100 in this example:
On the Take Profit control, click the Split Targets button:
Enter 4% into the Take Profit target (9) and set the Volume to 75%, this means we will close 75% of our entry position when the price is 4% higher.
Click the Add TP Target (10) button to lock this setting in, and enter the next Take Profit target of 6% and use the remaining 25% of the position size in the Volume control and click the Add TP Target button again to complete our profit target entries (11):
The last step on the Take Profit settings is to enable Trailing Take Profit (12), turn this option on and set it to -0.05%, this will follow price above our target, the idea here is to try and catch a little extra profit should price pump past our original target:
Finally, we will set our Stop Loss (13) to -2.16% according to our Trade Plan and also enable the Trailing Stop Loss (14) feature which will stay -2.16% away from the current chart price as it moves up and beyond our Entry price of the trade:
You can now click the Create Trade button and review the settings on the confirmation box that is displayed:
If you are happy the settings are entered correct, click Confirm, otherwise close the box with the X button at the top right.
Congratulations, your trade has been created and you can monitor trade progress (15) and also click to view a chart with the Take Profit and Stop Loss levels indicated (16):
All that is left to do now, is to wait for your trade to play out, knowing that every eventuality is covered, your trading plan is fully automated. You can go out for a walk, go to sleep, watch a movie and reclaim your time!
Warning: Trading with your funds is inherently risky, and while the rewards may be great, so are potential losses you can incur. If the price of the cryptocurrency you are trading falls dramatically, you may suffer a loss if you sell at a lower price than you bought the currency for. 3Commas blog posts are written to be educational and should not be considered as “Financial Advice”.