If you have spent any time at all in the crypto trading world, you would most certainly have made this mistake. You probably saw the RSI dip into the oversold territory and thought, that it was a good time to jump into the trade, only to see the price continue to fall.
Or maybe, you have taken trades when MACD crossed bullish, only to get chopped in a sideways range a little later. All this isn’t bad luck as many keep telling themselves. This is an actual structural problem with how, most people in the crypto work use technical indicators. This is the exact problem we aimed to solve at CHKKY.
The Single-Indicator Trap
Almost all popular indicators are incomplete and flawed by design. Considering that RSI measures momentum comparing the magnitude of the recent gains to the recent losses; it’s great at spotting if an asset if overextended. However, this doesn’t tell you anything about trend direction.
An asset according to the RSI could stay overbought for days if the uptrend is strong, and as a result, every trader that tried to short the first RSI signal gets steamrolled.
On the other hand, MACD will tell you about trend and momentum, mostly built for moving average relationships. Though it is great at confirming the momentum shifting, it lags. By the time a MACD crossover may fire, the useful part of the move has already happened, meaning you may find yourself too late.
In choppy and range bound markets, MACD is known to generate a stream of false crossovers, which could essentially lead to traders being bled dry.
When used alone, each indicator answers a different part of a partial question, which is why a single indicator only goes so far.
- RSI asks: is this move stretched?
- MACD asks: is momentum turning?
Neither of these indicators alone will ask: do both of these things agree, right now, on more than one timeframe? However, this is question that really matters. This is the question that most seasoned traders will look to answer before entering a trade, and most indicators will fall short of answering this question accurately.
What Dual-Confirmation Actually Means
Dual confirmation isn’t some fancy term we coiled up which means the use of two indicators, rather, the term refers to filtering discipline. Instead of acting alone on the RSI or MACD, either in the 1 hr or 4hr or 15 min even, a Dual Confirmation system such as of CHKKY’s waits until multiple indicators are pointing in the same direction at the same time.
The requirements for a Buy or SELL signal on this basis eliminates a huge share of the noise that comes with a single indicators system even when considered on multiple timeframes.
Think of it as a multiple key system, each indicator used as a key, requiring all locks to be unlocked by all keys, ensuring that statistically, the chances of that signal being wrong as rather miniscule. When ALL the indicators are agreeing with each other, CHKKY will give you a signal, one that can be relied on for a GREATER degree of accuracy in comparison to traditional indicator based analysis.
While one indicator based trading is a guess, using a signal based on Multiple indicators is a signal worth considering, not to mention, bravely accurate.
CHKKY believes in confluence, and we always check if confluence exists in more than one timeframe, before we consider it a valid signal worth exploring. Not to mention the direction prices which provide useful guidance into reading the market for optimum gains from swift entry and exit.
Why Timeframe Matters as Much as the Indicators Themselves
Though indicators are part of the equation, indicators alone cannot provide the level of accuracy we would need to ensure that almost each and every trade we enter closes in profit.
Even a perfect system using multiple indicators alone will not provide the trend analysis that is needed for a good deal of accuracy on the signal generated. A 15 minute chart can show you textbook bullish confluence, while the 4hr chart is still on a downtrend, meaning there is a greater chance of the market moving further downwards.
Traders who only look at the 15 minute chart will always walk into a bad trade, because they haven’t look at the trend on the grander scale, in the higher time frames.
This is the main reason why our signals require agreement across various timeframes, not just the 1 hr or the 15 min. This means, not only are we waiting for confluence on a range of major indicators, the confluence is considered on a range of timeframes to allows for the greatest degree of accuracy.
This layered filter system doesn’t only work to just reduce false positives mathematically, it reflects and confirms something true about how markets actually move. If the move is Real, and the move is within a tradeable trend, it will tend to show up on multiple timeframes simultaneously, because they’re driven by capital flows large enough to leave fingerprints at every zoom level.
Fakeouts, or TRAPS as many traders define, by contrast, are usually confined to a single, smaller timeframe, which is exactly why checking only one timeframe leaves you exposed to them.
The Tradeoff, and Why It’s Worth It
Signal groups are everywhere, and everyone that we have come across will either charge you for a membership, or some VIP group, which means the signals are hidden behind some sort of paywall.
Along the way, we began to question these signals and the accuracy of these paid VIP groups even. For is the signals were as accurate as they claim to be, then why would anyone have to sell these signals to profit? Would they not just be profiting from the accurate signals.
No filtering system is free. Dual-confirmation across two timeframes means fewer signals than a single-indicator, single-timeframe approach would generate. If you’re looking for maximum trade frequency, this isn’t going to give it to you, and that’s intentional. However, we truly believe in quality over quantity. 10 quality signals are more useful than 100 useless ones.
Our hit rate, and the accuracy of CHKKY signals as we have observed over the last year is remarkable in terms of accuracy. When we began, it didn’t have the level of accuracy it currently holds. Along the way, much needed tweaks were made to get us to this point, where we now are so confident in CHKKY signals, we already know where the market is going to go, atleast a day ahead of time.
We promised ourselves one thing. If these tools were shown to provide a good deal of accuracy, we won’t go down the route that most signal providers do and hide them behind paywalls. Instead, we make it accessible for free, so that the whole community can access them, judge the accuracy for themselves, use the signals to profit, and if they are grateful, send us a donation.
For anyone trading with real capital, this tradeoff is almost always the right one. Overtrading on noisy, single-indicator signals is one of the most common ways retail traders lose money, and we did not want to lose money. It was never losses through catastrophic single bets, but rather through a slow bleed of small, poorly-timed entries that each seemed reasonable in isolation, however almost all failed. Cutting signal volume in exchange for signal quality is, in practice, a risk management decision as much as a technical one.
How to Use This Framework and Understand How the Tool Works
You don’t need CHKKY specifically to apply this logic that is built into the tools we offer. If you’re charting manually, the discipline is simple to adopt:
- Never act on RSI alone. Treat it as a flag, not a trigger.
- Never act on MACD alone. Treat a crossover as “something to watch,” not “something to trade.”
- Check whether RSI and MACD agree before considering entry.
- Then check the next timeframe up. If your entry idea came from the 1H chart, glance at the 4H before committing.
- If any of these four checks disagree, wait. The absence of a signal is information too.
Obvious to state, these things aren’t easy and not just about anyone will have the patience and means to manually apply the logic we have built into these tools. However, the Framework of these Tools were built of serious trading logic that some of the most seasoned traders adopt.
At CHKKY, we don’t believe in Signals for Profit, instead, we believe in providing the tools and means to help just about anyone DYOR, and recommend that you use the tools and conduct further analysis to confirm entry and exit. Let’s just say CHKKY is the helper when it comes to those unable to grasp the reality of how to read the crypto market.
Where CHKKY Fits In
We built CHKKY because running this four-way check manually, across 33+ tokens, in real time, isn’t something most traders have the time or attention to do consistently, it just isn’t possible to scan through that many tokens manually. And consistency is the entire point. A discipline you only apply half the time isn’t a discipline, it’s a coin flip with extra steps. Which was why, even though we had the trading logic, we ourselves were struggling to apply them in the real market.
However, CHKKY’s dual-confirmation system across various timeframes runs continuously in the background, so the filtering happens before a signal ever reaches you, not after you’ve already second-guessed yourself into a bad entry. It just makes life a whole lot easier, because it find potential entry points for you, all you have to do is go the extra mile to reap the benefits from these FREE tools.
Markets don’t reward people who react fastest to a single indicator. They reward people who wait for real confluence and have the discipline to skip everything else.
Get our free signals at chkky.com.