Hey what’s up guys, this is Tai Zen again. It’s getting late over here and I’m broadcasting from New York City. I just want to share this with you guys real quick, I was chatting with a bunch of guys today on the trading view chat box over here, and we were discussing the Ethereum price.
If you guys remember back just a few days ago, in a previous video that I made about when is the best time to buy Ethereum, the price was around this point right here. It was just on that green candle right there, and I made an analysis stating that this would be a good time to get in. In case you forgot guys, the reason why I said that was this.
You guys see how this first candle right here where the crosshairs on there. If you guys look at this, you guys will notice that when the price came down here, it broke this support level right here. So when I broke that support level, keep in mind that all the people that were long from back here, the people that were long from here, they got stopped out, they had their stops right here.
When it came down here, they would get stopped out. That’s one group of people that are selling because their stops are getting triggered right here. Now it could be done, it could be an institutional dope, it could be some big whales selling to squeeze people out.
It can even be the Poloniex doing or Poloniex purposely running everyone stops because they can see it. There’s no reason why they would not do it because they can collect all the transaction costs. So it’s absolutely no evidence at all that they would not do it.
Matter of fact, there’s more evidence that they would do it because it’s in their best interest. I’ll talk about that in a separate video. This video I don’t want you to get sidetracked. I just want to talk about how this is another good buying opportunity here that I mentioned last time when is a good buying opportunity.
It’s in this candle right here. I said that if it gets below this, you gotta get out of your stops, you gotta get out of your trade because there’s enough profit potential to where you can take a wide stop like this. This is a long-term play guy. I made a projection that it’s going to come up to here, to the original 37 mils a bit that it was at right here, and then put your stop below here.
In this video, if you got it back down here on that green candle or on that red candle right there, then I would say that the risk is still the same. But if you miss that move and for whatever reason, you were scared or you were nervous to get in, I’m gonna share with you guys 2 more entries that you guys can get in on this.
The first one is you can go ahead and get in right here, right now as long as you are still in this green zone here, I will even adjust this one. The last one is still valid as long as you got in here, but now we have to update the entry base up because we have more data on the charts now. I would say that it’s safe that you can get in anywhere in here now at this point.
You get anywhere in that green area as long as you get in, no matter where you get in, your stop is going to be right there below this low. So that means that if you got it right here and your stop is down here below this low, then if you guys look at it, there is a risk you’re risking 1 unit of risk to make about 11.6 units of gain. If you decide that you get in right here, the absolute worst-case scenario, if you’re gonna be hard-headed and stubborn, is that you get your stop out down here below this low.
You cannot put your stop below this green line, this support level below here because the entry in which you guys got in is a little bit later now. So the later that you wait to get in, the more risk that you will incur. So if you’re getting right here, put your stop below this low, no absolute worse, you cannot let it go below this.
So if you go below this, you just change your risk-reward from 11 units of gain of reward to 6 units of reward. Some of you guys that watching this video right now, you guys are really nervous, you’re scared or whatever the reason is, and you want confirmation. So if you’re gonna base it on the fact that you want to see confirmation that the price is breaking up above this purple trend line and starting to go back up, anytime you wait for confirmation in the markets, you are going to lose, you are going to incur more risk and less reward.
That is just the basic principles of trading guys, and there’s no getting around or no workaround for that. If you sit around and wait for confirmation, then you have to put up more risk and be willing to accept less reward for waiting for confirmation. That’s the price that you pay to get confirmation, the price is going in your favor or in the direction that you want.
I always put my trend line and there’s no right or wrong to this. The key to doing anything in trading is that there’s no right or wrong, it’s just doing it consistently every time. So I always consistently try to put my trend line where it hits the most point right here.
So there it is right there guys. If you wait for confirmation, this is what it’s gonna look like. You will enter the trade once it breaks the high of that tall green candle, and it breaks above this purple downtrend line, the intermediate short-term trend line.
So you can enter anywhere in that area right there and this will be your risk right there. We just reduce the potential reward from 11 to 1, now it’s down to 4 to 1, so you’re gonna risk 1 unit of risk here, and only look to get 4 units of reward. Now the absolute worst case scenario is that once you enter there, once it breaks above the purple trend line, and the high of this green candle, is that some of you guys may get stubborn and you put your stop-loss down here.
In that case, you just cut your reward down from 3 to 1. So 1 unit of risk to 3.3 units of reward. To me, I don’t like waiting for confirmation because I always have to incur more risk and take less reward.
Because of that, I always prefer to get in on the trade when there’s a drop in price like that into my support level. So I hope this helps you guys out. Keep in mind also guys, we are doing this based on a linear scale, we’re not doing this based on a logarithmic scale, I’ll do that in a separate video.
Now if you guys put this here, you can see that it’s bouncing off for this. There are some people in the trading view guys in other people in the troll boxes that are asking me ‘Hey, there’s a break in the trend line right here. Doesn’t that mean that this is a downtrend line?’ And the answer to that is absolutely not.
That does not mean just because you have a break in the trend line, that does not mean that it’s a downtrend immediately. What I’m looking at is this, guys, I’m going to show you guys this little trick here that I use when I’m trading. Originally if you guys follow, when I put my trend line right here originally, notice how it hits this.
If you guys notice how it pokes through, if you guys noticed originally when the price came up to here, I want you guys to pay attention to the poke, the distance of this poke. If you guys measure this poke, it’s about a 7%-poke through. There’s not a technical name for this, but it’s about 7 or 8% where it pokes through the trend line.
As we come over here and we update the trend line, as prices continuing up and we drew this, we updated this trend line. When the price is over here, and I’m hitting these right there, and then I want you guys to notice this little poke through the trend line again when I grabbed the ruler here and we’re going to measure this. We’ll notice that the poke is again around 7.6-7.8% percent, somewhere around there.
It doesn’t have to be perfect, it’s somewhere around that region. Obviously, as the price continues to go up, the higher the price goes up, every time it pokes through that trend line like that, it’s gonna poke even more. So notice how I poked through here, and then it came back up.
So as the price goes higher, the proportion, the percentage of the poke, usually if you guys are been trading something for a while, you guys will notice. The poke on this one is about 8%. So now if we update the trend line again, as the price moves we update the trend line.
So now that price is moving all the way over here, the trend line when we updated, it’s going to look something like this. It does not have to be perfect. Now notice when I touched the corner here, the corner of that one, and I touched the tail this one, the majority touch is what I’m using.
I’m using is the majority touch method, with a majority hit rule. Now you guys come over here, you guys see that little poke through right there, if you guys look at it and look at the percentage in which it pokes through, you will notice that the poke through in this particular case is 11%, somewhere around anywhere between 9 to 11% right there.
So it’s within a reasonable amount of poke through the trend line, and that’s the reason why I did not panic and freak out and try to sell short here. In order for me to sell short here, I would have to wait for this to come down and then retest and then come back down. So after this red candle here, it starts to come back down.
Then I would look for a pullback and then I would get in on short if I was a short-term trader. Now I do not recommend going against the trend guys because in the long term if Ethereum is going to succeed, it’s on its way up. So I am not a counter-trend trader, in other words, I go with a long-term trend with the daily and the weekly trends, I try not to go against it.
So when it comes up to here in these areas, I would look to take profits and then just sit on the sideline and go trade something else and then try to get back in for a long. Ethereum, Bitcoin, everything like that, it’s a new revolutionary technology, it’s on its way up so I don’t like to go against the trend. I’d rather just sit on the sideline and do nothing until there’s an opportunity.
So just a quick summary before I let you guys go, if you guys get in right here right now, put your stop below this. If you’re a breakout trader, then you would get in after the break of this high right here in the break of this trend line. A breakout trader is usually a confirmation trader, they’re waiting for confirmation, the price is going in their direction before it.
It’s up to you which one you like to do, there’s no right or wrong, whichever method that you guys choose to enter a trade, make sure it’s the same and as consistent. And like always, the majority of the time when you enter a trade, you’re gonna lose money.
The other one 2/3 of the time, you’re probably not going to make money, but that other one throw at the time that you do make money on, you have got to let the trade run in your favor so that you can make money and capture the big chunks in the market. I do not encourage you guys to scalp the liquidity, there’s not a volume in these Cryptocurrency markets to the scalp, you’re wasting your time scalping.
You want to capture these big moves right here. So that’s just my philosophy guys, the traders that I work with, that I coach, that’s what I encourage him to do and I would not encourage you guys to do that to try to scalp the market and get slaughtered. And then again in case you forgot, this blue line is my projection on how the angle in which the price is gonna go.
And all I did was I got that from the angle, the trend of these has shot up previously. If you guys want to learn more about that then check out my previous video where I explain a little bit more. I had mentioned on the trading view chat box that my friend Eric and I and Leonfu.com, we were all going to shop looking for a Lamborghini.
It’s funny because we went into the Dallas Lamborghini dealership and they did not want to talk to us. So one of the guys that followed me on the trading view, he asked me to post the pictures, so here’s a picture of me and Eric G right here. The white one behind us guys is a convertible, that’s a Lamborghini Aventador.
And this one right here, the white one over here is a Huracan. I’ve used to teach art a lot for many years guys and I’m not really a big fan of orange, and they had neon orange, the Lamborghini there. And then they had a bright reddish orange which is the one that I’m sitting in front of here.
This is also Aventador and these are magnificently amazingly awesome looking sports cars. So one of the guys asked me to post the pictures and share with them, so there it is guys. Some trading analysis plus some Lamborghini shopping pictures right here.
The sales people were very lousy salespeople at the Lamborghini dealership, they saw me and Eric going there and they did not want to talk to us. Unbeknowing to them, they have no clue what Cryptocurrencies can do for your life. If you’re wondering which one we’re deciding on guys, we still have not decided on it yet.
Whichever one that we do get, we’re gonna call it the Ethereum Lamborghini or the Ethereum Lambo or the Auger Lambo, whichever one that helps us pay for the Lambo guys, that’s what we’re gonna name it. So hopefully we can find the right one.
Leonfu.com suggested that we also look at the Ferrari 458 Italia. Both of them are nice cars, but enough about that. Get more to it whenever we get close to that date guys.
But I just wanna share it real quick with you guys because some of the guys on tradingview.com asked me to post these pictures. Hopefully, you guys enjoyed this analysis, I’ll talk to you guys in a future video. And if you guys like these type of analysis, give me a thumbs up and then if you guys don’t like it, give me a thumbs down so I don’t waste time making it.
If you drop this down to a one-hour chart guy, here’s something that I want to bring up to your attention so you don’t panic when you see this. You guys noticed when the price came down here, there was a big run-up in price and then there was a big drop and now it’s on its way back up. Don’t let these price wings scare you, always stick to your stop losses.
If you get stopped out, you can always get back in at the same prize. If you got in right now and you come down and it stops you out down here guys, if the price stops you out and then it comes back up to that same level again, you can always jump back in. It doesn’t cost you anything to jump back in guys, but you never want to let this trade go against you by massive amounts.
So thanks for watching this video guys. If you guys like it, subscribe to my channel and if you have any questions or comments or suggestions, put in the comment section below and I’ll see you guys in a future video.