Long-term crypto investor Jelle, who reached the Bitcoin top in 2021, recently provided insights on the best time to buy and sell crypto assets. Jelle provided a background for his knowledge as he stated that these insights helped him sell his Bitcoin holdings at the height of the crisis last bull run.
A powerful bull market indicator
In a post shared on his X platform (formerly Twitter), Jelle explained one of the “most powerful bull market indicators” that could help traders understand the direction of the market. This was based on how to use moving averages (MAs) for entries and exits of trading transactions. When entering trades, Jelle noted that he usually finds the confluence between MAs and horizontal levels.
The analyst shared a chart to further expand on his point. According to him, a good entry usually occurs when the price retests an area that “makes sense both horizontally and MA-wise.” This strategy is said to work well in the early stages of cancer bull market. However, he warned that traders will likely have to rely solely on MAs further into the bull market.
Source: X
He went on to give insight into his Bitcoin trading strategy in particular. He said he uses the 21-week moving average when trading the flagship cryptocurrency. Regarding the lower time frames and altcoins, Jelle said that a combination of the 25, 50 and 200 Exponential moving average (EMA) works well.
Finding trading exits for assets like Bitcoin
Jelle also provided insights about this how to find trade exits. He noted that selling to MAs also works well and is preferable when there is confluence between the MAs and the horizontal levels. He also discovered that this strategy works best in downtrends. However, that was how he exited the Bitcoin market at its peak in 2021.
Source: X
Regarding the best time to use MAs for exits and entries, Jelle said it works best when a strong trend is present. Meanwhile, the strategy is said to be “much less accurate in a sideways market.” Although he decided not to go into details, he said mean reversion strategies are more successful under such circumstances.
Overall, Jelle believes that MAs are a “great indicator in the trading toolbox.” However, he warned traders not to “trade blindly” when the price reaches an MA. Instead, they should also look at how the price reacts to the area. He gave an example of how fuses through an MA can tell someone how “it is respected.”
Jelle had that before insights given on how to buy the right dips in a bull market. His insights also bordered on using moving averages to achieve this.
BTC loses footing above $38,000 | Source: BTCUSD on Tradingview.com
Featured image from BBVA.ch, chart from Tradingview.com