Bitcoin USD (BTCUSD) pair is now a widely traded asset and there are a few regulated brokers that offer Bitcoin and Ethereum trading on Meta Trader 4 terminal. That means that Bitcoin technical analysis can be performed within your MT4 platform.
Since we had a few customers asking us how our custom trend indicator, TrendViper, performs on Bitcoin, here are a few screenshots across multiple time frames to give you a general idea.
Although we normally recommend only looking at the Weekly and Daily charts to eliminate market noise, we appreciate that there are many technical analysts who are interested to see how the indicator performs on Bitcoin across various time frames available on Meta Trader.
All screenshots were taken on zoomed out chart view and running the TrendViper indicator with its default settings (5 / 50 MAs and 25 ADX). The screenshots were taken right after another on the 20th of April, 2020.
Bitcoin BTCUSD, Weekly chart
This is a weekly chart view, which shows how the TrendViper managed to signal major price moves. Over the course of a few years, with the default settings of 5 / 50 MAs and 25 ADX, the trend indicator generated 5 signals on a Weekly chart.
Bitcoin BTCUSD, Daily chart
Here on the Daily chart the indicator also performed quite well with its default settings. It seems like it missed the fourth signal (we see the trend line color change but there is no arrow) because the ADX filter is set to 25, which is a safe setting. Lowering the ADX to 20 would actually force a signal on this particular trend change. The second signal seems late, but all other signals seem quite good.
Bitcoin BTCUSD, H4 chart
The overview of the BTCUSD H4 chart with TrendViper looks quite interesting. There was a very sudden bullish jump that the indicator managed to signal. The previous signal also seems quite good. The last signal pointed in the right direction, but the bearish drop came much later and the price slightly increased before it went down. A tight stop loss would have been activated.
Bitcoin BTCUSD, H1 chart
We can see some conflicting signals generated on the H1 chart. Unfortunately, the default settings of the indicator do not perform very well on Bitcoin below the H4 time frame.
Having said that, the indicator can be modified to suit any time frame and strategy. The TrendViper indicator can be specifically adapted to each particular instrument and time frame to optimize its performance.
We also need to consider the fact that BTCUSD is one of the most volatile pairs and any technical indicator will struggle to anticipate its price swings correctly, especially on lower time frames.