Book Image

Zero to Hero in Cryptocurrency Trading

By : Bogdan Vaida
Book Image

Zero to Hero in Cryptocurrency Trading

By: Bogdan Vaida

Overview of this book

In today's fast-paced digital age, cryptocurrencies have emerged as a revolutionary financial asset class, capturing the attention of investors and traders worldwide. However, navigating the world of cryptocurrency trading can be overwhelming for beginners. Zero to Hero in Cryptocurrency Trading acts as a guiding light to navigate this complex realm. This comprehensive guide to cryptocurrency trading empowers you to go from a novice trader to a proficient investor by helping you implement your own trading strategy. As you progress, you’ll gain structured trading knowledge through hands-on examples and real-time scenarios, bolstered by trading psychology and money management techniques. You’ll be able to automate your manual trades with an algorithm that works even while you sleep. You’ll also benefit from interactive teaching methods, including screenshots, charts, and drawings to help decode market operations and craft your unique edge in the dynamic crypto world. As an added bonus, you’ll receive ready-to-use templates to identify useful indicators, test your strategy, and even maintain a trading journal. By the end of this book, you’ll be well-equipped to trade cryptocurrencies and automate manual trading to give you an edge in the markets.
Table of Contents (13 chapters)
9
Chapter 9: What’s Next?

Backtesting

In this section, I’m going to present to you an efficient way to backtest a trading technique. It’s not meant to be perfect, you aren’t doing it automatically via an algorithm using multiple conditions, but it does its job, and it separates strategies that might not work from the strategies that might work.

You’ve identified a potential trading pattern and defined it as a strategy. You know its filters, the setup, the entry trigger, the stop loss point, and the take-profit point(s), and you have some ideas on how to improve it.

Now it’s time to see how well it worked in the past.

In order to do this, you need to have a period where the market was in an uptrend, a period when it was in a downtrend, and a period when it was in a sideways trend. These periods should be of the same range and in the same timeframe as your strategy.

For example, you could look at the BTC/USDT pair during 2020-10-04 – 2021-01-09 (around 3 months...