After the first two unmissable installments of Trader Cobb’s webinar series, today, we dove into the third class. Craig starts off with a quick recap of some of the fundamentals we learned in the first two classes and reminds us of the importance of being able to identify trends and stay away from unnecessary technical jargon. He briefly reviews what we’ve seen before including support, resistance, moving averages, and candles, and then, without further ado, he starts class three.
The Crypto Cradle Trading Strategy
Craig reminds us that the “cradle zone” is the zone in which the price should start to catch our attention… It doesn’t always mean that we should place a trade, but whether it’s an upward trend or a downward trend, it must be in the cradle zone where we see convergence between the price trend and the indicator, in this case, MACD.
Now, onto the checklist. Craig says that our job is to tick each one of the essential factors off and make sure that they are all are met before we even consider a trade. There are bonus factors we can use as well, but if the essentials are not met, the trade is not there. “If you do not meet all the essential factors there is absolutely no point in looking at the bonus factors,” he affirms.
Crypto Cradle Essential Factors
He takes us through the essential factors again including the fact that the time frames need to be in agreement, the moving averages must be in the right order, the candle we’re looking at for the trend is in the cradle zone, and the trigger chart is converging with nothing in the way of achieving our target (such as no major support or resistance to ensure at least a break-even result). This means looking at higher timeframes to confirm that the trade price must break the high or low of the entry candle.
He shows us a perfect cradle long setup showing us the upward trend of higher highs and lower lows confirmed by the MACD indicator (below).
He then goes back to checking the time frame trends, the next item on the checklist, and then the class goes through each essential item that we need before placing a trade once more with interactive examples so that we can identify whether the trade is valid or not. This provides invaluable practice at learning to identify trends and really understand the signs that show whether a trade is there or not.
While giving participants time to find the answers themselves using the checklist provided, Craig also takes plenty of questions throughout the class via the live chat box and, to prevent any internet issues this week, Craig even tethers the entire class from his phone!
After allowing us to do the exercises ourselves, he goes through them with us using the essential factors on the checklist. “Practice makes perfect,” he says, you are going to need some time on this, so don’t despair if it hasn’t completely sunk in yet. Again, he gives the reminder that, if it’s not clear, it’s not there.
He advises us not to pressure ourselves and then gives several more examples to work out whether there is a trade or not. If you haven’t taken part in the first two classes, be sure to go back and do them first as you can’t become a profitable trader if you are missing some of the key ingredients.
Cradle Bonus Factors
As the name suggests, Craig reiterates that bonus factors are exactly that and are only for when you are very clear and understand the essentials checklist. They are simply there to improve your probabilities. He says that the number one bonus factor is having the price pulling back to an old support or resistance level. He then goes through the bonus factors one by one but always reminding us that they are simply additional extras and mean nothing if the essentials aren’t there.
The third class in this series is very hands-on and interactive and Craig gives plenty more exercises for participants to identify the trade going through one-day and two-day trigger charts, working through the essentials, and then trying to add in the bonus factors if they can. He then goes through the examples with the participants, answering their questions, and pointing out the areas that they need to look at by themselves as he won’t be here to hold their hands.
He asks questions like whether we can spot the trend going through the checklist, whether the indicator agrees with the price, and why would it make sense to exit a trade at a certain point? In the example he uses, we can see that a long upward trend is about to take a turn to the downside, so if we are holding a long position, that’s a sign that we need to exit. This third webinar places a lot of emphasis on the students and they get plenty of time to put all they have learned so far into practice.
Becoming a Profitable Trader
Craig reminds participants that there is a lot more to trading than just buying and selling, even if that is the only thing you can do in the market. If you want to be successful and make a sustainable living, you need to think about trading as a business. He talks about the importance of risk management and the other factors that are vital to success beyond your strategy checklist (all of which he will go into more detail next week).
“There is a lot more to trading than many people think,” he says. Traders need to understand not only the market but also their risk, objective, and themselves. He says that it’s fundamental that we learn to be disciplined and to work on ourselves and learn to trade without emotions.
Don’t miss the fourth and final part of this incredible series at the same time next week in which Craig will be going into more detail on these elements and bringing the whole course together.
And if you’re new to the DFE or want to receive additional help, you can now book an exclusive one on one exchange demo with one of our experienced account specialists. We will show you all you need to know from loading your account up with DGTX to placing your first trade using the one-click ladder and looking at some advanced features as well. Book your free tour now!