Executive Summary

This briefing synthesizes recent market data on Ripple (XRP), revealing a significant divergence between its strong third-quarter fundamental growth and emerging short-term bearish pressures. While Q3 metrics demonstrated exceptional performance that outpaced major competitors, subsequent on-chain data indicates substantial profit-taking and market uncertainty.

• Exceptional Q3 Growth: In the third quarter, XRP’s market capitalization surged by 29%, a rate of growth greater than that of Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) combined. This was consequently supported by robust network expansion, particularly in new address creation and the burgeoning Real World Asset (RWA) sector on the XRP Ledger.
• Emerging Selling Pressure: In contrast to the strong quarterly performance, recent data reveals a massive spike in selling from long-term holders. Between October 19 and 28, net selling from this cohort increased by over 2200%, signaling significant profit-taking after the recent price rally.
• Conflicting Institutional Signals: Whale activity presents a divided picture, thereby increasing market uncertainty. While “mega whales” (holding 100M-1B XRP) have been accumulating, the next tier of large holders (10M-100M XRP) has been actively selling, indicating a lack of consensus at the institutional level.
• Technical Outlook: XRP’s price has recently fallen from a consolidation pattern, with key technical analysis pointing toward potential further downside. Crucial support levels are identified at $2.51 and $2.46. Consequently, the combination of holder selling and uncertain whale behavior suggests a high probability of a short-term price correction.

1. Q3 2025 Performance Review: A Period of Significant Growth

Analysis based on data from the global crypto asset data platform Messari highlights an exceptionally strong third quarter for XRP, marked by superior market cap growth, expanding network activity, and significant ecosystem development.

1.1 Market Capitalization and Price Action

During the third quarter, XRP demonstrated market-leading growth. The asset’s market capitalization expanded by 29%, reaching an impressive $170.3 billion. Furthermore, this performance significantly overshadowed the combined growth of its major peers—BTC, ETH, and SOL—which collectively grew by only 13.3% over the same period. In terms of price, XRP achieved a quarterly high of $2.85, representing a 27% increase compared to the previous quarter.

1.2 On-Chain Network Metrics

On-chain data reveals a dynamic network, characterized by user base expansion but a slight contraction in overall activity and transaction costs. These metrics provide a nuanced view of the network’s health during its high-growth phase.

1.3 Ecosystem Expansion: DeFi, Stablecoins, and RWA

The XRP Ledger (XRPL) ecosystem experienced substantial growth, particularly in the areas of Decentralized Finance (DeFi) and the tokenization of Real World Assets (RWA).

• DeFi and Institutional Adoption: Decentralized Autonomous Trusts (DATs) are increasingly adopting XRP for on-chain asset management. Platforms such as TridentDAO, Everest, and Autonomys have integrated XRP, and the institutional custodian Metaco registered over $1 billion in XRP deposits.
• Stablecoin Growth: The Ripple-backed stablecoin, RLUSD, played a pivotal role in the ecosystem. Its supply grew by 34.7% in Q3 to reach $88.8 billion. The total stablecoin supply on the XRPL now stands at $11.69 billion, contributing to a combined XRPL and Ethereum stablecoin market of $93 billion.
• RWA Tokenization: The RWA sector on the XRPL recorded explosive growth, with tokenization increasing between 115.5% and 364.2% in the third quarter. Noteworthy projects include the tokenized U.S. Treasury Bill (TBILL) and OUSG, a short-term U.S. government bond fund from Ondo Finance.

2. Emerging Headwinds and Short-Term Technical Outlook

Despite the powerful Q3 performance, more recent data from late October indicates a significant shift in market sentiment. Key on-chain indicators and technical analysis now point to a heightened risk of a near-term price correction, driven by extensive profit-taking and uncertain institutional positioning.

2.1 Long-Term Holder Profit-Taking

According to data from Glassnode, long-term XRP holders have begun to liquidate their positions at an accelerated rate.

• Between October 19 and October 28, the net volume of XRP sold by long-term holders surged from 3.28 million to 77.9 million.
• This represents an increase of over 2200%, a clear indication that this cohort is capitalizing on recent price gains. This sharp increase in selling pressure is a primary bearish signal for the short-term outlook.

2.2 Conflicting Whale Behavior

The activity among the largest XRP holders, or “whales,” is currently fractured, which introduces a layer of market uncertainty.

• Accumulation by “Mega Whales”: The largest cohort, holding between 100 million and 1 billion XRP, has been buying. Since October 27, this group increased its holdings from 8.13 billion to 8.24 billion XRP, an accumulation of approximately $289 million.
• Distribution by Large Whales: In contrast, the next tier of whales, holding between 10 million and 100 million XRP, has been selling. Over the same period, this group reduced its holdings from 8.31 billion to 8.27 billion XRP, amounting to a sale of approximately $155 million.

This divergence shows a lack of consensus among major market participants, which often precedes a period of volatility or price correction.

2.3 Technical Analysis and Key Price Levels

From a technical standpoint, XRP’s price action signals weakness.

• Pattern Breakdown: The price was previously consolidating within a symmetrical triangle pattern, oscillating between $2.69 and $2.60. However, it has since broken down from this pattern, falling to $2.54 at the time of reporting.
• Key Support Levels: The primary support zones to monitor are 2.51 and the 0.618 Fibonacci retracement level at 2.46. A failure to hold these levels could lead to a more significant downturn.
• Potential Upside: Conversely, if the price can reclaim the 2.69 resistance level, a bullish scenario could see a rally toward 2.88. Nevertheless, given the on-chain selling pressure, the short-term outlook remains skewed to the downside.

Important Notice : The information presented is not a recommendation to invest. All investment decisions and any resulting outcomes are the sole responsibility of the individual.

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Ethereum is currently navigating a short-term consolidation phase, with prices fluctuating between approximately $3,900 and $4,200. Despite this price correction, the underlying structural trend remains firmly bullish. Furthermore, a confluence of powerful on-chain metrics, accelerating institutional capital inflow, and significant upcoming network upgrades substantiates this positive outlook.

Key bullish indicators include exchange reserves hitting an all-time low of 12.5 million ETH, signaling strong HODLing behavior, and a significant increase in staked ETH, which now accounts for 60% of the total supply. Concurrently, whale addresses have accumulated over 500,000 ETH in October. In addition, institutional investment in Ethereum products ($9.6B in Q3 2025) has surpassed that of Bitcoin. Meanwhile, the derivatives market, while showing reduced leverage, indicates a paradoxical bullish sentiment with negative funding rates. Moreover, the forthcoming Fusaka upgrade on December 3 is poised to dramatically enhance network scalability and efficiency, providing a strong medium-term catalyst. Although immediate price action ties to key technical levels, the confluence of fundamental strength suggests that the current price range presents an attractive entry point for a structurally sound asset.

1. Market Snapshot & Technical Analysis

Ethereum exhibits signs of short-term consolidation within a broader, long-term uptrend. Specifically, recent price action has seen a 3.48% decrease to $3,982, followed by movements to $4.13k and a subsequent 5.57% increase to $4.18k, accompanied by a significant 165.27% surge in trading volume.

1.1. Multi-Timeframe Technical Indicators

Overall, the analysis across different timeframes reveals a mixed short-term picture but confirms the long-term structural integrity of the uptrend.

1.2. Key Support & Resistance Levels

Liquidation data provides critical insight into key price levels where market pressure could shift.

• Strong Support: $3,844
  • This level coincides with the 4-hour Bollinger Band lower boundary.
  • Here, a significant $577 million in cumulative long liquidations cluster, forming a robust support zone.
• Intermediate Resistance: $4,083
  • This represents the 4-hour Bollinger Band mid-line, a key pivot for short-term momentum.
• Strong Resistance: $4,100 – $4,117
  • The options market’s “max pain” price of $4,100 reinforces this zone.
  • Crucially, a $1.31 billion cumulative short liquidation risk exists at $4,117, creating an asymmetric risk profile that heavily favors the upside if the market breaches this level.

2. Derivatives Market Analysis

The derivatives market points to a cooling of speculative leverage while simultaneously flashing contrarian bullish signals.

• Open Interest: Stands at $47.65 billion, a 24-hour decrease of 3.61%, indicating a reduction in leveraged positions.
• Funding Rates: Major exchanges are showing negative funding rates (e.g., Binance -0.0054%, Bybit -0.0092%). Specifically, this signifies that short positions are paying long positions, a market condition that often acts as a contrarian indicator for a potential price bottom or squeeze.
• Liquidation Data: Over the last 24 hours, total liquidations reached 162 million. Long positions accounted for 73% (119 million) of this total, confirming recent downward pressure. However, the immense short liquidation cluster at $4,117 presents a more significant and asymmetric upward risk.

3. On-Chain Data & Network Health

On-chain metrics are exceptionally strong, painting a picture of a robust and growing network with high user conviction. In fact, Ethereum is experiencing peak on-chain activity, which DeFi usage, stablecoin transfers, and low gas fees are driving.

3.1. Network Activity & Usage

3.2. Holder Analysis & Whale Activity

• Supply Concentration: The top 10 addresses now hold 61% of the total supply, an increase from 58% in September, indicating ongoing accumulation by large entities.
• Key Holders:
  • Beacon Chain Contract: 66.1M ETH (54.7% of supply)
  • Coinbase Custody: ~6.2M ETH (5.1% of supply)
  • Grayscale ETF: ~3.1M ETH (2.6% of supply)
• Whale Accumulation: In October, top whale wallets accumulated over 500,000 ETH. For example, SharpLink Gaming purchased an additional 19,000 ETH on October 25.

3.3. Exchange & Staking Dynamics

• Exchange Reserves: The total ETH held on exchanges has fallen to an all-time low of 12.5 million ETH, a 15% decrease year-over-year. This is a powerful signal of long-term holding conviction and reduced sell-side pressure. Notably, Binance reserves alone fell by 17% in the last month to 3.87M ETH.
• Staking Growth: In parallel, investors have now staked a total of 71.83 million ETH, representing 60% of the entire circulating supply. This marks an 8% increase over the last month.
  • Active Validators: 2.14 million
  • Staking Yield (APR): ~3.5%

4. Fundamental Market Drivers

Ethereum’s fundamental case is strengthening through institutional adoption, regulatory clarity, and pivotal network upgrades.

4.1. Institutional Adoption & ETF Flows

• Institutional Dominance: In Q3 2025, institutional investors allocated $9.6 billion to Ethereum, surpassing the $8.7 billion invested in Bitcoin.
• ETF Activity:
  • In terms of ETF Activity, BlackRock’s Ethereum ETF recently acquired 17,440 ETH, underscoring significant institutional interest.
  • Although there was a recent single-day outflow of 93.6 million (linked to a BlackRock withdrawal), Ethereum spot ETFs still maintain a massive 14.35 billion in net inflows.
  • For instance, a daily snapshot from October 27 showed a net inflow of $133.9 million, led by BlackRock’s ETHA.

4.2. Network Upgrades & Scalability

• Fusaka Upgrade (December 3): This upcoming hard fork is a major catalyst. It introduces Proto-Danksharding (P-rDAS), and analysts expect it to:
  • Increase blob capacity by 8x (from 6 to 48).
  • Raise the gas limit to 16.8 million.
  • Dramatically improve L2 efficiency and reduce transaction costs.
• Layer-2 Innovation: Furthermore, the heavily oversubscribed ICO for MegaETH highlights the vibrant innovation occurring in the L2 space, which further enhances the network’s overall capabilities.

4.3. Regulatory Environment

• U.S. Regulatory Clarity: The SEC’s approval of the ERC-3643 standard for compliant tokenized assets is a major step forward, potentially unlocking a $1 trillion market. Additionally, the market views the appointment of a pro-crypto CFTC chair as a positive development.
• Global Adoption: On the global front, Japan’s first JPY-pegged stablecoin (from startup JYPC) launching on Ethereum demonstrates growing international acceptance and regulatory progress in digital finance.

5. Ecosystem & Sentiment Analysis

Market sentiment is currently neutral, but the underlying narrative within the community and among institutions is decidedly long-term bullish.

• Market Sentiment: The Fear & Greed Index is at 51, indicating a “Neutral” stance.
• Community Outlook: Prominent opinion leaders are maintaining long-term price targets of $10,000, with a narrative spreading that focuses on the upcoming upgrades and accelerating institutional demand. Consequently, there is a growing consensus that the market undervalues Ethereum.
• DeFi Growth: The ecosystem is maturing, evidenced by a surge in DeFi Total Value Locked (TVL) to $89 billion. This growth, combined with high demand for stablecoin transactions, is contributing to the narrative of an emerging “supersycle.”
• MetaMask Enhancements: Finally, improvements to MetaMask’s asset transfer speeds and multi-chain account functionality are bolstering interoperability and DeFi adoption.

6. Trading Scenarios & Risk Management

Based on the technical structure, two primary scenarios present themselves.

Recommended Risk Management:

• Position size should not risk more than 0.75% of total portfolio equity.
• Traders should keep leverage below 5x.
• Also, monitor market dynamics around the upcoming options expiry on October 31.

Conclusion

Ethereum is exhibiting classic signs of a healthy consolidation within a powerful, long-term secular uptrend. Therefore, while short-term price action remains choppy, the fundamental and on-chain data presents an overwhelmingly bullish case. The historic low for exchange reserves, coupled with 60% of the supply being staked and aggressive accumulation by whales, demonstrates profound supply-side conviction. At the same time, surging institutional demand and the major technological catalyst of the Fusaka upgrade match this conviction. The structural uptrend remains valid as long as the price holds above the $3,700 level. Consequently, traders should view any dips towards the strong support cluster at $3,844 as strategic buying opportunities.

Important Notice : The information presented is not a recommendation to invest. All investment decisions and any resulting outcomes are the sole responsibility of the individual.

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Double RSI Strategy

Let me show you a highly profitable Forex and Crypto trading strategy. It’s called the Double RSI Strategy and it has the highest win rate. The strategy requires Chandelier and the Double RSI indicators. I will explain all the points to fix the flaws and increase the odds of winning.  

You can use this strategy in any timeframe and make highly profitable trades. I recently used this strategy with trading Ethereum and my success rate was well above 90% Let’s first start with the Chandelier Indicator.

The Chandelier Indicator

For this Double RSI crossover strategy, we will use the Tradingview charts. First, you will change the candlesticks to Heikin and then add the Chandelier Indicator. Many people use the Chandelier indicator without changing the settings which produces false signals. We will change the settings of this indicator to better filter out the false signals.

On the following Gold chart, the timeframe is set to 4 hours, and the indicator is applied with the default setting. You can see we have multiple buys and sell signals from the Chandelier indicator. However, most signals are fake, and that’s because the chart timeframe is set to 4 hours, and the indicator is applied with default settings.

We can remove the false signals by making a few changes to the Chandelier indicator. To change the indicator settings, click on the settings window and uncheck or disable all options except “Buy Lable” and Sell Label”. Then these labels appear below and above the bar.

Now from the input section of the indicator, change the ATR period value to 1 and the ATR Multiplier to 1.85, as shown in the following chart.

Remember! In this strategy, we always follow the trend. So, you don’t trade if you get a sell signal in an uptrend. Likewise, you won’t trade if you get a buy signal in a downtrend. In short, we go against the prevailing trend.

We will also use a second indicator which is Double RSI indicator. It is required to confirm the signal. Based on the strategy, both the indicators should produce the same signal to place a trade. 

For instance, if you have a buy or a sell signal from the Chandelier Indicator, but the Double RSI does not confirm the signal, you will not take that trade. This way, we will eliminate the false trade signal and make our strategy almost 100% successful.

Double RSI Indicator

So to apply the indicator, go to the indicator section again and add 2 RSI indicators to the chart. The RSI period of both will be 25 and 100 respectively. You can also change the color for the 25-period RSI to yellow and the 100-period RSI to blue. I change these colors for better visual representation, and you can set the colors of your choice. However, make sure the RSI periods are set to 25 and 100.

Now, we will put these two RSI indicators together. To do that, click on the three dots, and from the move to option, select the axis pane below.  Now, again connect the three dots and change the scale by choosing the pi to scale Z. Our Double RSI indicator is ready, and we can eliminate the false signals.

We will look for a crossover of the two RSI lines to get confirmation from the Double RSI indicator. 

A buy signal will be confirmed when the short-period RSI, or the yellow RSI line, crosses the 100-period RSI from bottom to top. 

Likewise, a sell signal will be confirmed when the short-period RSI, or the yellow line, crosses the 100-period RSI from top to bottom.

Remember! If we do not get a second confirmation from the double RSI, the Chandelier Indicator signal will not be confirmed, and we will not take the trade.

Filtering Out Fake Signals

Let me show you how the Double RSI filters out the false signals and makes our strategy nearly 100% successful. 

In the following chart, we have a sell signal. Now, we need a second confirmation from the double RSI indicator, and for that, the short period or the yellow RSI line must cross the blue RSI line from top to bottom. 

But around the same time when the Chandelier Indicator gave the sell signal, the RSI lines did not have a crossover. The yellow RSI line was already under the blue line. So the second signal was not confirmed, and you can see that the price also started to rise.

Now let’s also see how the Double RSI indicator helps to filter out the false signal for the buy trades. 

The following chart shows a buy signal from the Chandelier Indicator. Now we need a second confirmation from the Double RSI indicator, and for that, the short period, or the yellow RSI line, must cross the blue RSI line from the bottom. However, when the Chandelier indicator gave the buy signal around the same time, the two RSI lines did not crossover. Therefore, the double RSI indicator alerted us about a false trade signal, and the price significantly dropped.

This Double RSI Crossover Strategy is truly unique. By changing the indicator settings and introducing the Double RSI indicator, we have increased the winning chances to almost 100%.

The strategy is equally ideal for new and experienced traders. However, for the new traders. You can apply this strategy to buy or sell crypto, Forex, or even stocks.

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WYCKOFF Volume Spread Analysis

The volume spread analysis is a unique method and it is mainly used by banks and professional traders. Surprisingly the method is not discussed too often. In this tutorial you will learn all about volume spread analysis using the Wyckoff’s theory. You will learn about its components and 4 four different stages of the price cycle. Towards the end of this tutorial you will be able to analyze the volume and predict the future price movement. The analysis requires the volume indicator that is available on all modern trading platforms.

What is Volume Spread Analysis (VSA)?

The Volume Spread Analysis is the study of Price concerning its corresponding volume. The study is used to identify the underlying reasons behind the market movement or its behavior.  In other words, if a trader anticipates a bearish or bullish movement then there must be an underlying reason behind it. The Volume Spread Analysis tracks down the professional activity or the moves of the smart money. The Smart Money in this context is the Big Banks Hedge Funds and Large Financial Institutions that have the big pockets to move the market the way they want.

What is Wyckoff's Theory?

Wyckoff’s theory was initially presented in the early 20^th century by Richard Wyckoff. The analysis of the supply and demand through the examination of the trading volume is the central pillar of Wyckoff’s theory. The theory was initially used for the stock market. However with time it has evolved and with all the changes it remains relevant with the modern-day markets. 

According to Wyckoff a high volume in a market comes from professional traders while the low volume shows that professionals are not interested in buying. The theory further elaborates that the prices can be manipulated but the volume cannot. So by analyzing the volume one can eliminate the subjectivity from trading and that can help to understand the market psychology and its sentiments. According to the theory a price cycle has four stages. We will discuss these stages in the latter part of this video.

Advantages of Volume Spread Analysis

The Volume Spread Analysis can be used in any market like Forex stocks indices commodities and Futures. Many people might argue that Forex Volumes are useless as it is a decentralized market and has no real volume. However, Forex has Tick Volumes which is a proxy to real volumes and correlates it 90% of the time. 

The Volume Spread Analysis (VSA) can be applied to any timeframe meaning it is equally useful for day trading swing trading or even scalping. 

The factors that distinguish the Volume Spread Analysis (VSA) from other methods of analyses are Its non-subjectivity and its ability to detect the big player’s manipulation which helps to indicate the cause of imbalance between the supply and demand.  

Volume Spread Analysis components

There are five components of volume spread analysis. These components are compared to analyze and predict the future price movement. 

The first component is the spread. It is the difference between the opening and closing prices. 

The second component is the volume. It is the frequency of transactions during a specified period. The bigger the volume histogram bar the higher the volume is. Likewise the smaller the bar the lower the volume is. 

The third component is the Bearish and Bullish Volume. Bearish Volume is marked in Red and it shows bearish activity. The Bullish Volume is marked in green and it shows bullish activity. 

The fourth component is the Above Average High Volume. It is the Highest Average Volume in the current session. Average Volume is the volume that coincides with 20 periods of Moving Average. 

The fifth component is the Ultra High Volume and it is the Highest Volume in the current session.

Four Stages of Price Cycle

According to the Wyckoff theory a price cycle has four stages. Lets’ learn about these stages one by one. 

Accumulation 

In a price cycle the accumulation stage occurs when Supply and Demand are in balance with each other. 

Mark Up 

The mark-up stage occurs when the demand increases than the supply. In this stage a bullish rally is observed and it generally happens after the completion of the accumulation process. 

Distribution  

The distribution stage occurs when Supply and Demand are in the balance after an exhausting mark-up move. 

MarkDown 

The mark downstage occurs when Supply becomes more than Demand. It causes a drop in the price and it happens after a distribution stage.

How To Use Volume Spread Analysis?

The volume spread analysis is ideal for both the bullish and bearish markets. The analysis helps to find a trading signal using the signs of weakness and the signs of strength. These signs basically indicate the change in demand and supply. 

The signs of weakness indicate exhausted buyers or in other words they indicate an increase in supply. The increased supply causes the market to fall. 

Likewise the signs of strength indicate the exhausted sellers or in other words they indicate an increase in demand which leads to the rise in the price. 

Let’s first learn the different signs of strength. Remember these signs are valid only if they appear in a down-trending market. 

Down Thrust

Down thrust is the bullish pin bar. or the Doji bar. It has an ultra-high or above-average high volume. The Spread of the down thrust bar is extremely low. meanwhile the volume is relatively high. The volume spread analysis suggests. that if the spread is low then the volume should also be low. So the down thrust indicates a divergence between spread and volume. and it signifies that there is more demand or the sellers are under pressure. Therefore the price is likely to rise in the future.

In this example this down thrust bar has an ultra-low spread while the volume is high. The down thrust indicated high demand which is a bullish signal and you can see the price increased following the bullish signal. 

Selling Climax

Selling Climax is a high spread bearish candlestick that closes well above its low. It has a noticeable downwards wick whose size is approximately 20% of the candlestick body size. It has an ultra-high or above-average high volume.

The rejection from the low along with the high volume bar indicates that the market has more demand than supply and the price is likely to rise in the coming sessions. 

In this example we have this high spread bearish candlestick that closed approximately 20% above its low. The volume bar in this session is indicating an ultra-high volume. The spread and the volume analysis suggest there is high demand or the sellers are under pressure. Following the bullish signal you can see a noticeable rise in the price. 

Low Bearish Spread With Low Bearish volume

In this sign of strength a candlestick has a large bearish spread than the previous candlestick but its volume is lower than the previous candlestick volume. The volume spread analysis suggests that there should not be any result without any effort. Here the effort refers to the volume while the result refers to the spread. So the large bearish spread is in disagreement with the low volume which indicates a lower supply and that can possibly push the price higher in the coming sessions. 

In this example we have a high bearish candlestick whose spread is larger than the previous candlestick and its volume is lower than the volume of the previous candlestick. The volume spread analysis signifies a disagreement between the spread and price and indicates a possible increase in the demand which is a bullish signal.  Following the signal you can see the price significantly gained before taking the next dip. 

Low Bearish Spread With Higher Bearish Volume

In this sign of strength a candlestick has a low bearish spread compared to the previous candlestick but its volume is higher than the previous candlestick volume. The volume spread analysis suggests that there should not be any result without any effort. Here the effort refers to the volume while the result refers to the spread. So the low bearish spread is in disagreement with the high volume which indicates a higher upcoming demand and that can push the price higher. 

In this example this candlestick is having a low bearish spread compared to the previous candlestick. But the volume of this candlestick is higher than the volume of the previous candlestick and it is a disagreement between the spread and volume. Following the disagreement you can see the falling price gradually started to rise.

No Supply Bar

No Supply Bar This is a low spread bearish candlestick having a downward wick. Its volume is lower than the previous two candlesticks volume. No Supply bar means that there is a lack of supply and demand is overpowering supply causing the price to rise in the future. Please note that No Supply Bar is a continuation signal not a reversal signal. No supply bar is effective only if it appears after bullish momentum or appears after Sign of Strength in the direction of the trend. 

In this example we have a low spread candlestick with a downwards wick. The volume bar in this session is lower than the volume of the two previous sessions.  The volume spread analysis suggests a lack of supply and since this is happening in an ongoing uptrend the No supply bar suggested the continuation of the ongoing trend and you can see the price gradually kept rising in the coming sessions. 

Now let’s learn the signs of weakness. Remember these signs are valid if they appear in an up-trending market. 

Upthrust

Upthrust is the bearish or Doji candlestick whose spread is extremely low while the volume is relatively high. According to the volume spread analysis if the spread is low then the volume should also be low. So the upthrust is a disagreement between spread and volume which signifies that there is more supply than demand and it may cause the price to fall in the coming sessions.

In this example this upthrust candlestick has a low spread while the volume is relatively high. The upthrust candlestick and the high volume bar indicate the lower demand which is a bearish signal and you can see the price significantly dropped following the bearish signal. 

Buying climax

Buying Climax is the high spread bullish candlestick that closes well below its high. The candlestick has a noticeable upwards wick whose size is approximately 20% of the candlestick’s body size. It has an ultra-high or above-average high volume.

The rejection from the high along with the higher volume indicates that the market is over-supplied and the price is likely to drop in the coming sessions. 

 

In this example we have a medium spread bullish candlestick that closed approximately 20% lower from its high. The volume bar in this session is indicating an ultra-high volume. The spread and the volume are in disagreement and suggest the market is over-supplied which is a bearish signal. You can see following the bearish signal the price significantly moved lower. 

Large Bullish Spread With Low Bearish Volume

In this sign of weakness a candlestick has a large bullish spread than the previous candlestick but its volume is lower than the previous candlestick volume. The volume spread analysis suggests that there should not be any result without any effort. Here the effort refers to the volume while the result refers to the spread. So the large bullish spread is in disagreement with the low volume. It indicates an increased supply which is a bearish signal and the price is likely to drop in the coming sessions. 

In this example we have a bullish candlestick whose spread is larger than the previous candlestick and its volume is lower than the volume of the previous candlestick. The volume spread analysis signifies a disagreement between the spread and price and indicates an over-supplied market which is a bearish signal.  Following the signal you can see the price dropped significantly lower. 

 

Low Bullish Spread With Higher Bearish Volume

In this sign of weakness a candlestick has a low bullish spread compared to the previous candlestick but its volume is higher than the previous candlestick volume. Based on the volume spread analysis this is a disagreement between the spread and the volume. The disagreement signifies the declining demand or the increasing supply which is a bearish signal and the market is likely to drop in the coming sessions.

In this example this candlestick is having a low bullish spread compared to the previous candlestick. But the volume of this candlestick is higher than the volume of the previous candlestick and it is a disagreement between the spread and volume. Following the disagreement you can see the rising price gradually started to fall. 

No Demand Bar

This is a low spread bullish candlestick having upward wick whose volume is lower than the previous two candlesticks volume. No Demand bar means that there is a lack of demand and supply is overpowering demand causing the price to fall in the future. Please note that No Demand is a continuation signal not a reversal signal. No Demand sign is effective when it appears in bearish momentum. 

In this example we have a low spread candlestick with an upwards wick. The volume bar in this session is lower than the volume of the two previous sessions.  The volume spread analysis suggests a lack of demand and since this is happening in a downtrend the No demand bar suggested the continuation of the ongoing trend and you can see the price kept dropping in the coming sessions. 

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Scalping Stratagies

Scalping is a trading technique that involves entering and exiting from the market in a very short period of time to obtain a quick profit. This trading method has gained huge popularity in recent times. It is used on smaller time frames starting from just 1 minute. The scalping strategy is equally effective for Forex stocks commodities or any other financial market. Using this technique trader’s place high frequency trades and it requires high volatility to enter and exit in short period of time. That is why Forex is considered a more convenient market.

There are several ways you can scalp the markets. You can scalp by visually analyzing the price action and predict the price movement. You can simply rely on the candlestick Patterns or the western charting patterns to look at the price action and place the trades. You can also use technical indicators and oscillators like the moving average and the RSI. The technical indicators and oscillators can be used in isolation or you can use them together for better signals. So to wrap up scalping is a style of short-term trading and it requires high volatility to enter and exit from the market.

So what is an effective way to scalp the markets? .The right way to scalp the market is to have a high-performance scalping strategy.  There are several trading strategies available. However not all strategies are high-performing strategies. In this video you will learn about multiple scalping trading strategies that are effective easy to learn and they will keep you on the right side of the market.  

We will first start with a simple strategy and then move on to more advanced scalping strategy. The first strategy that you are going to learn is simple and effective. It is based on the moving average indicator.  

Scalping Strategy Using 2 Moving Averages

So what exactly is our strategy? Our strategy is to use two exponential moving averages one with a 50 period and the other with a 200 period. The idea is to trade when the two moving average crossovers. The crossover produces a bearish or bullish signal and based on the crossover we will place our trades.

What is Bullish Bearish Crossover?

A bullish crossover takes place when the short-term moving average crosses the long-term moving average from below.  A bullish crossover signals that the price is likely to rise and as a trader it’s generally a buy signal.  

Likewise a bearish crossover takes place when the short-term moving average cross the long-term moving average from above. A bearish crossover indicates that the market is likely to drop and traders take it as a sell signal.

Now based on our moving average strategy we will use a 5 minutes candlestick chart and take a buy position when the moving averages produce a bullish crossover. Meaning when the short period moving average crosses above the longer period moving average. The stop-loss in this trade will be just below the 200 period moving average. While the take profit will be double the size of your stop loss.

Similarly we will take a sell position when the moving averages indicate a bearish crossover or in the other words the short period moving average crosses below the long period moving average. The stop-loss for this trade will be above the 50 periods moving average and the take profit will be double the size of your stop-loss.

Now let’s look at our strategy in action. Following our strategy two Exponential Moving Averages with 50 and 200 periods are applied on EURO/JPY 5 minutes chart. The 50 period E M A color is red while the 200 E M A color is blue.  

You can see that the market has been largely trading sideways. However just around 128.70 the price started to rise and around the same time the short period E M A crossed above the longer period E M A which is a bullish signal. So following the bullish signal a buy entry is placed with a stop loss just below the E M A 200. Let’s see on the next chart how the market moved?  

Scalping Strategy Using Two Indicators

In our first strategy we have used two exponential moving averages and it was based on the crossover. In this strategy we will use only one Exponential moving average and with that the second technical indicator will be an oscillator which is the Relative Strength Index or RSI.

RSI is a momentum indicator. It is generally used for identifying the oversold and overbought zones. It’s available on all the trading platforms and when applied on a chart it gives a reading between zero to hundred. The 50 is a neutral zone while reading near or below 30 is considered an oversold indication. Likewise a reading near or above 70 is considered overbought.

Strategy Breakdown

Based on the two indicators strategy we will place a buy trade when the RSI is above the neutral zone and the moving average line is below the current price. Having RSI above the neutral zone indicates the market is headed upwards.

Likewise having the moving average line below the market price indicates a support area.

The stop-loss in this trade will be just below the moving average. While the take profit in this trade will be when the RSI reaches near the overbought zone.

To place a sell trade using our strategy the RSI needs to be below the neutral zone and the moving average needs to be above the current price. Having the RSI below the neutral zone indicates that the market is headed lower and having the moving average line above the current price is an indication of a resistance area. The stop-loss in this trade will be above the moving average line. The take profit will be when the RSI line reaches near the oversold zone. Now Let’s have a look at your strategy in Action.

Based on our strategy a 50 period EMA and the RSI are applied on the following EUR/CAD chart which is set to five minutes interval.  .You can see the pair is having two way movement and no clear direction is available. However near 1.4680 the RSI moved above the neutral zone. Around the same time the price that was keeping below the EMA also moved above the E M A line.  Following our strategy this is a bullish signal. So a buy trade is placed at 1.4680.  The stop-loss is kept below the EMA around 1.4665.   Now let’s see what happened after our strategy gave a bullish signal and we placed a buy trade.  

Now from the next chart you can see the performance of our strategy. Soon after taking the buy trade, the pair moved higher towards 1.4700. You can also see around this level the RSI entered the overbought zone. And based on our strategy we can close our position here in 20 pips profit. Alternatively to benefit from the entire rally you can also use a trailing stop loss.

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Day Trading Using ABC Strategy

ABC trading strategy is a comprehensive day trading strategy. The strategy is built around two major components that are the ABC price pattern and MACD histogram. In this video we will go over both of these components individually. You will understand the logic behind this trading strategy and learn to use it for day trading with proper entry and exit levels.

Since this strategy is for day trading that is why it is important to first learn what exactly day trading is. How effective day trading can be What exactly you can achieve from being a day trader What should be your position size How much should you risk in a day and what should be your ideal target profit on a specific day.

The RSI Indicator is around since the 1970s and it is a leading indicator which means it provides an early signal on a possible price change in the market.  

What is Day Trading

Day trading is a style of short-term trading. In this style of trading a trader focuses on opening and closing the trades within the same day.  A day trader capitalizes on short-term price changes to achieve the daily target. Day trading is the opposite of a long-term investment strategy. It is opposite because in a long-term trading trades are held for a longer period.

There are many advantages of day trading.  Being a day trader you avoid overnight risk. The overnight risk refers to the fact that when you hold a position overnight your money is exposed to major unexpected moves.  Day trading is also effective because you risk only a small portion of your investment on a particular day. In day trading you get the time to review your performance every day. In other words you get the opportunity to fix any flaws in your strategy and achieve your targets in an accomplished manner.

However to become a successful day trader you need to formulate some rules of engagement. These rules basically define the key elements like your risk position-sizing and profit targets.

As a general rule of thumb the risk should not exceed more than 1 percent of your total equity on a single day. For example if you trade with $100000 your maximum daily risk should only be $1000. The 1 percent risk is from a conservative trader’s point of view and the aggressive traders usually increase the percentage to match their risk appetite.

In day trading position sizing remains relative to your risk percentage. If you risk 1 percent and enter the trade with an oversized position your stop-loss is more likely to get hit within a small price fluctuation. In Forex trading one standard lot of a currency pair is generally considered ideal with a $100000 equity and 1 percent risk per day. Likewise In stocks and other financial markets you can figure out a reasonable position size based on your risk percentage.

Finally you also need to set your daily profit targets in day trading.  A reasonable profit target should be double the size of your stop loss. For example if you risk $1000 your take profit should be $2000. Having your take profit double the size of your stop-loss keeps you in profit even if you lose 50 percent of the trades.

Now that you understand what is day trading and know about its rules of engagement let’s move on to learning the actual trading strategy.

ABC Trading Strategy

ABC trading strategy is primarily a trend following strategy. The strategy requires two confirmations to execute a trade. The first confirmation comes from the ABC price pattern.  The second confirmation is taken from the MACD histogram.

The strategy is mainly used for trading in direction of the trend. However it can also be used to spot and trade the reversals. We will also discuss trading the reversal using this strategy towards the end of this video. But before that let’s first go over both the ABC price pattern and MACD histogram and learn how they work and produce the signal.

The ABC price pattern is a 3 wave pattern. Wave A tells about the direction of an ongoing trend. Wave B goes against the direction of the ongoing trend. Wave C then moves back in the direction of the trend. The ABC price pattern shows a common phenomenon in the financial market which is that the rising and falling prices temporarily move in the opposite direction before moving back in the original direction of the trend.

These small movements in the opposite direction are called the corrections. The corrections provide the traders the opportunity to enter the market at a better price while staying on the side of the trend. The whole idea of using the ABC price pattern is to find these points and enter the market at a better price.

To further understand this concept take a look at this EUR/USD chart. The RSI was keeping above the neutral zone and the pair was been steadily rising until the RSI entered the overbought zone. Soon after entering the overbought zone the pair started to move lower and dropped over 200 pips.  

MACD Histogram

Now let’s also learn about the MACD histogram which is the second component in our trading strategy.

The MACD is a technical indicator. It uses three different Exponential Moving Averages for its calculation and it plots two lines along with a histogram. One of the lines is called the MACD line while the other line is called the signal line. The MACD line and the Signal line frequently crossover each other and produce a bullish or bearish signal. Traders use the signal from these lines and place their trades.

However in our strategy we will use only the MACD histogram fort the signal. The histogram shows the positive and negative bars that it plots on the middle line.  The histogram shows how close or far apart the MACD and Signal lines are from crossing each other. The histogram is basically an early warning system that even signals a change before the crossover. The histogram does this by showing the positive and negative bars above or below the middle line.

Now let’s learn how to read the signal and place the trades using this strategy.

How To Read The Signal?

This first thing in the strategy is to identify a trend and spot the making of an ABC pattern. The strategy can be used for both long and short trades.

For the buy trades once an uptrend is identified you can mark that area as A from where the price started to rise. Following the rising price now look for some correction and mark that area as B from where the price starts to fall. After some correction when the price starts to move back in the original direction of uptrend mark that area as C. At this stage wave C has just started and the first signal will be confirmed when wave C crosses above the starting point of wave B.

Once that happens you need to look for the second confirmation using the MACD histogram. The signal from the MACD histogram will be confirmed only if the bars are positive and above the middle line. If the bars are negative or remain below the middle line the signal will not be confirmed despite having the ABC pattern.

When both the signals are confirmed you can place the buy trade. The stop loss for this trade will be below the starting point of wave C. The exit will be just below the previous high. For the exits you can also use the MACD histogram. The ideal way to exit using the histogram is when the bullish bars start to contract.

 

ABC Trading Strategy Example

Now let’s understand the strategy using a practical example. Because the strategy is mainly for day trading this GBP/JPY chart is set on the 1 hour time frame. The pair was trending lower until at this point the price started to rise. We will mark this starting point as A  .Soon after some upwards movement a small correction phase started. We will mark this area as B. After a small movement in the opposite direction the pair once again started to rise. We will mark this area as C.

The first signal is confirmed after wave C moved above the starting point of Wave B. Now a signal from the histogram is required to place the buy trade. The histogram bars remained bearish even after the first confirmation from the ABC pattern. However after a couple of sessions the histogram bars turned bullish and also moved above the middle line. This confirms the signal and you can see the pair continued to move higher.

Now let’s take an example of the sell trade using the ABC trading strategy. This USD/CHF chart is set on the 1 hour time frame. The pair started to drop from this point and we will mark this area as A!  .After dropping a while the price started to make some correction. We will mark the starting point of correction as B!  .After a small correction the price once again started to drop and we will mark this area as C!  .The signal from the ABC pattern is confirmed when the price breached blow the wave C!

Now the first signal is confirmed and a second confirmation is needed from the MACD histogram. Around the same time when wave C breached below wave B the histogram was already bearish and also kept below the middle line. This confirmed both the signals and the pair continued moving lower.

Reversal Strategy

The preferred method of using the ABC trading strategy is to trade in the direction of the trend. However it can also be used to trade the reversal. The idea is that if wave B which is the correction wave moves beyond wave a then it indicates a possible trend reversal. In such a case you can place the trades in the opposite direction of the ongoing trend.  

In a bullish market if wave B moves below the starting point of wave A it signals a lower move and if the histogram bars also turn bearish you can place the sell trades.

Likewise in a downtrend, if wave B extends above the starting point of wave A it signals a higher move and if the histogram bars also turn bullish you can place the buy trades.

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Relative Strength Index (RSI)

Relative Strength Index or RSI is a technical indicator that measures the market momentum by comparing it’s upwards movement with the downwards movement over a specific time period. The RSI was developed by a technical analyst named J. Welles Wilder. He described the momentum as being the velocity of the directional price movement. So according to him it’s not just whether the price is going up or down it is how fast the price moves up or down.  

The RSI Indicator is around since the 1970s and it is a leading indicator which means it provides an early signal on a possible price change in the market.  

 

Basically the RSI measures the overbought and oversold conditions. An overbought condition is when the price of an instrument trades above its fair value. Likewise an oversold condition is when the price of an instrument trades below its fair value. Both the overbought and oversold conditions have their implications. Generally when the market enters the overbought or oversold zone it soon follows a correction. Traders look for these overbought and oversold zones and place their trades accordingly.

When you plot RSI on a chart it oscillates a line between 30 and 70. A reading near 50 is considered neutral. If the RSI line moves between 50 and 70 it indicates a bullish momentum. If the line moves above 70 it indicates an overbought market.

Likewise if the RSI line remains between 50 and 30 it signals a bearish momentum. Finally if it moves below 30 it indicates an oversold market.

How To Trade Using RSI?

To trade using the RSI indicator the general consensus is to trade when the market is overbought or oversold. It’s because these are the levels from where the market is likely to make a correction. So in simple words you can sell when the RSI is near or above 70. Likewise you can buy when the RSI is near or below 30.  

To further understand this concept take a look at this EUR/USD chart. The RSI was keeping above the neutral zone and the pair was been steadily rising until the RSI entered the overbought zone. Soon after entering the overbought zone the pair started to move lower and dropped over 200 pips.  

 

Now let’s understand the oversold concept from this GBP/USD chart. During this highlighted period the RSI largely kept below the neutral zone and the pair kept dropping from 1.3900 until the RSI entered the oversold zone. Soon after the RSI oversold indication the bulls started to intervene and the pair started to move higher.  

In addition to using the RSI for overbought and oversold zones you can also use RSI to determine the exit levels. Let’s assume that you are holding a buy position. The trade is in profit but you are not sure about the exit level. In this case you can plot the RSI and if it remains in between 50 and 70 you can continue holding your long position. However you need to close your position as soon as the RSI moves above 70. Having the RSI above 70 essentially means the market is overbought and it can make some correction anytime. Therefore it is ideal to book the profit at this stage.

Likewise you can also use the RSI to determine the exit level for your sell trades. In this scenario you can continue holding the sell position until the RSI remains in between 50 and 30 and close the trade as soon as the RSI moves near or below 30. Having the RSI near 30 indicates the overbought zone and the price may recover anytime from that point. So it’s an ideal time to book the profit.  

Just like any other technical indicator the RSI can also produce false signals. To minimize this risk you can use a second indicator. This can be pivot points Bollinger bands or even the moving average indicator.  Majority of the traders prefer using the moving average with the RSI. The moving average provides further insight to the trend direction and it also indicates the support and resistance areas.

This brings us to the end of this lesson. As with any trading indicator it takes time and practice to gain an upper hand and there cannot be a better way than practicing on a demo account.

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The AUD/USD pair is currently experiencing a loss in upward momentum, especially as it approaches the 0.6898 resistance level, resulting in a shift to a neutral intraday bias. Should there be a decisive break above this 0.6898 threshold, it could potentially extend the rally originating from 0.6273, aiming next for the 0.7160 key resistance. However, on the flip side, if the pair breaks below the 0.6800 support level, it would suggest the formation of a short-term top, particularly under the bearish divergence condition evident in the 4-hour MACD. Such a scenario would reverse the intraday bias back towards a downward trajectory, potentially pulling back to the 0.6693 level, which is a resistance-turned-support.

From a broader perspective, there’s yet to be a definitive confirmation that the downtrend from the 0.8006 level (high of 2021) has reached its conclusion. The price movements from the 0.6173 low in 2022 might represent merely a medium-term corrective pattern. The recent rise from 0.6269 is interpreted as the third leg of this corrective pattern. For the time being, it’s expected that the pair will engage in range trading, oscillating between the 0.6173 and 0.7160 (high of 2023) levels, pending any further market developments.

Analysis Summary

AUD/USD exhibits a neutral intraday bias with waning upward momentum near the 0.6898 resistance. A break above this level could lead to testing the 0.7160 resistance. Conversely, a drop below the 0.6800 support hints at a short-term peak and potential pullback to 0.6693. The broader view suggests continued range trading between 2022’s low and 2023’s high.

Key Points

Neutral intraday bias in AUD/USD near 0.6898 resistance.
Potential rally continuation towards 0.7160 on a break above resistance.
The broader trend indicates range trading within 2022 and 2023’s significant levels.

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The intraday bias in USD/CAD has transitioned to a neutral stance, primarily due to the recent recovery observed in the market. On the downside, a breach of the 1.3180 level would signal a continuation of the decline from 1.3901, potentially reaching the 1.3095 support level and perhaps extending further downwards. However, it’s important to consider the bullish convergence condition noted in the 4-hour MACD. If there is a break above 1.3288, it would indicate a short-term bottom formation, shifting the bias back towards an upside trajectory for a more robust rebound.

The outlook for USD/CAD becomes more complex, primarily due to a deeper-than-anticipated decline from 1.3901. Despite this, the price movements from 1.3980 (the high of 2022) are still perceived as part of an ongoing corrective pattern. The larger uptrend, which commenced from the 1.2009 low in 2021, is expected to resume eventually, provided that the 1.2951 level (which has transitioned from resistance to support) holds firm.

Analysis Summary

USD/CAD shows a neutral intraday bias with recovery influences. A break below 1.3180 could lead to further declines towards 1.3095. Conversely, a rise above 1.3288 may indicate a short-term bottom and shift the bias upwards. The broader trend suggests a correction from 2022’s high, with a potential resumption of the uptrend from 2021’s low, contingent on the 1.2951 support.

Key Points

Neutral intraday bias in USD/CAD, with recovery influencing current trends.
Potential downside continuation below 1.3180, targeting 1.3095 support.
A broader perspective suggests a corrective phase from 2022’s high, with a long-term uptrend possible.

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