Greetings dear community today I have come to answer the task of this season 6 week 4 which talks about the median indicator, the median indicator is a very useful tool to perform technical analysis thanks to the teacher @abdu.navi03 I am going to make my entry in this opportunity.

1-Explain your understanding with the median indicator.

It is an indicator that is used to identify trends and trend breaks also to know the exhaustion of a trend is largely very important to obtain all these data to perform a high quality technical analysis, as we can say that the median indicator is effectively based on trends with moving averages , heikin ashi, etc. this indicator is of great importance because it measures the volatility of the market using an ATR from the median line.

In order for you to understand better I will describe the colors of each of its lines that compose the median indicator through an illustration below so you will have more knowledge about each of the factors to take into account:

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We can define the trends through the positioning of these average lines, and clouds, let's explain better There are two clouds of different colors, the purple one is called (Lower band) this defines that there is a downtrend because the median EMA is above this cloud and the Meadian MA is below it, that is, when the MA line crosses below the EMA line means that we are in the presence of a downtrend.

The green cloud or (Upper band) is created when the trend is bullish and this occurs when the MA crosses above the EMA on the chart we have to define well the temporality to be able to configure well our Meadian indicator for the moment I work it in short temporalities to avoid any type of interference in my analysis.

With this indicator we can define by means of all its arsenal of information that has a bullish or bearish trend and to avoid any type of interference it is advisable to use other indicators together with the median indicator.

2-Parameters and Calculations of the Median indicator. (Screenshot is required)

To use the median indicator or any other indicator it is very important to define our calculation parameters so we can start working on the required temporality with the parameters required to calculate a median indicator using the ATR and the multiplier to plot the upper and lower bands is as follows:

Median length: we can define it as the number of data points obtained by calculating the median with a value of 3.

ATR: Period obtained from the median ATR calculation with a range of 14.

ATR Multiplier this is multiplied by the ATR in the upper and lower bands range of 2.

These ranges are all default.

Upper band = median length + (2 ATR)
Lower band = median length - (2 ATR)

I will leave them as default and work short time frames with a strategy called skalping.

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3-Uptrend from the median indicator (screenshot required)

for the following example we see how the green cloud is below the price and as the trend goes up we see that the cloud gets bigger each time the EMA median line is placed below the MA median line which gives us a clear bullish entry. and when the green cloud decreases its thickness is because the end of the trend has come and will start the opposite transition in the market.

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The following chart shows how the EMA median is below the upper band and below the MA median. This gives us a clear example that the trend is bullish as all the crosses will give us an entry point as we see it continue at 1:2 with risk management pre-defined by the trader.

4- Bearish trend of the 4 median indicator (screenshot required)

Contrary to the uptrend and very important to emphasize it the indicators go above the price all the medians and the cloud changes color to purple purple, the average MA crosses with the EMA below this then we have in the middle the cloud (lower band) that determines us a downtrend in the market look that when the median crosses are formed we must confirm to avoid false market movements that would generate us if we operated them some important losses.

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In the following chart we can clearly see the selak when the medians cross and the purple cloud is created, this happens after a range or an uptrend, it gives us a very important data of short selling, which we must first know the strategy to use and the risk management required for the strategy in this case scalping.

5-Identifying false signals with median indicator (screenshot required)

We can identify some trends using an indicator called RSI for this we must go to the graph place the RSIand see the ranges that determines us the buy or sell position in overbought or oversold can also indicate us a range.Confirmation is quite important determining the supports and resistance on the chart and the breaks and patterns that are set in active depending on the temporality.

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The chart clearly shows how it breaks down as if it were a true signal to turn strongly after a break of important supports with high volume, this causes an interference for traders of this currency and in this temporality causing an erroneous entry and losses of assets by liquidation.

As we identify this let's look at the chart we see that it made a reversal after the break with great strength which reveals a rejection activity to the downtrend, but later it reverses again with an engulfing candle that tells us that the trend is bearish but if we look at the RSI we see that it is not at oversold levels at that time immediately we identify it as a false signal with the median indicator.

6-Open two demo trades, long and short, with the help of a median indicator or a combination including a median indicator (screenshot required)

Long trade: ETH/USDT

As we can see on the RSI we see an oversold with a pattern called shark fin typical to make an optimal and clean entry. we see how the cloud change from purple to green and the EMA AND MA changes that were above the price are now below the price indicates us an uptrend formation.

trading this entry I placed with my 1:1 risk management making a profit of +59.92 on a short demo trade.

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Short Shib/USDT

The short order was placed just after the hammer candle, looking at the RSI we can quickly identify a range so in short time frame can be traded very easily then I could start the trade at the beginning of the descending red candle and complete the trade remember friends that this trade is in short time frames and generate many profits if you apply a proper strategy to trade this asset.

Taking into account the great complexity cryptographic we must combine several indicators that will be our main tools to define a technical analysis within the asset that we will begin to operate in this way we get accepted results to be increasing our capital through this type of operations in the network.

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Conclusion:

In my homework research for this week we were able to define in a clear way what is a median indicator and establish the median calculations, we discovered how we can identify false breaks in the chart and also to get the correct signals stake profir entry points and stop loss using a comfortable asset management for our capital, as for the median indicator we can say that it is based on trends through clouds and average lines that combined make an excellent indicator for technical analysis.

To avoid false signals it is effectively recommended to combine with other indicators or tools that help us in a clear way to identify the corresponding patterns and eliminate any type of interference in the graph so we can work more comfortable and try to get the highest possible profits since the volatility of the market gives us margins that we can operate in different relative temporalices for you.

Cc:
@abdu.navi03