Can we add positions when the daily line breaks through the 60-day moving average + the 30-minute OBV new high?

A daily close above the 60-day moving average with rising OBV on the 30-minute chart signals strong bullish momentum and a potential entry point for long trades.

Jul 07, 2025 at 09:28 pm

Understanding the 60-Day Moving Average Breakout

In technical analysis, the 60-day moving average is often used by traders to determine long-term trends. When the daily closing price breaks above this key level, it may indicate a shift in market sentiment from bearish to bullish. Traders who follow this strategy believe that such a breakout can be a valid entry point for long positions.

However, not every breakout leads to a sustained trend. It’s crucial to confirm this movement with other indicators to avoid false signals. This is where volume-based tools like On-Balance Volume (OBV) come into play, especially on shorter timeframes like the 30-minute chart.

Key Point: A daily close above the 60-day MA suggests potential bullish momentum, but confirmation from OBV adds strength to the signal.

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What Is OBV and Why Use the 30-Minute Chart?

On-Balance Volume (OBV) is a cumulative indicator that uses volume flow to predict changes in stock or cryptocurrency prices. In crypto trading, OBV rising to new highs on the 30-minute chart indicates strong buying pressure even before the price reflects it.

The 30-minute timeframe is preferred by many traders because it filters out some of the noise found on lower timeframes like the 5-minute or 15-minute charts, while still offering timely signals. When combined with a daily breakout, this setup becomes more robust.

• OBV rising to new highs shows accumulation.
• Price confirming the OBV move strengthens the trade signal.
• Timeframe alignment between daily and 30-minute charts improves accuracy.

Important Tip: Always check whether the OBV line is making higher highs along with the price to confirm positive momentum.

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How to Confirm the Daily Breakout with OBV

To effectively combine these two signals, follow these steps:

• Step 1: Plot the 60-day simple moving average (SMA) on the daily chart.
• Step 2: Wait for a candle to close above the 60-day SMA.
• Step 3: Switch to the 30-minute chart and plot the OBV indicator.
• Step 4: Check if OBV has recently made a new high during the current uptrend.
• Step 5: If both conditions align, consider entering a long position.

This dual-timeframe approach helps filter out weak breakouts and increases confidence in the trade.

Note: The OBV should ideally make its new high around the same time as the price confirms the daily breakout.

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Entry Strategy and Position Sizing

Once the breakout and OBV confirmation are validated, traders can look to enter a position. Here's how to proceed:

• Place a buy order slightly above the daily candle that broke the 60-day SMA.
• Set a stop-loss just below the recent swing low on the daily chart.
• Use OBV divergence on the 30-minute chart to monitor early signs of reversal.
• Adjust position size based on your risk tolerance and the distance to the stop-loss.

For example, if you're risking 1% of your portfolio per trade and the stop-loss is 5% away from your entry, you would allocate roughly 0.2% of your capital to that trade.

Critical Detail: Never ignore the stop-loss placement; it protects your capital from sudden reversals after false breakouts.

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Risk Management and Exit Strategy

Even with strong indicators like the 60-day SMA and OBV, no trade is guaranteed. Managing risk is essential:

• Trail your stop-loss using a moving average or recent swing lows.
• Take partial profits when the price reaches key resistance levels.
• Monitor OBV closely for divergence or exhaustion patterns.

If OBV starts to decline while the price continues upward, this could signal weakening volume support and an impending pullback.

Caution: Do not hold a position solely based on a previous signal; always reassess with fresh data.

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Frequently Asked Questions

Q: Can I use OBV on other timeframes besides 30 minutes?

Yes, OBV can be applied to any timeframe, but the 30-minute chart offers a balance between responsiveness and reliability when confirming daily breakouts.

Q: What if the price breaks the 60-day MA but OBV isn’t making a new high?

That’s considered a weak signal. It’s better to wait for stronger confirmation or look for alternative entries.

Q: How reliable is the 60-day moving average in volatile crypto markets?

While it's less sensitive than shorter MAs, it can lag behind sudden price swings. Combining it with OBV improves its effectiveness in fast-moving environments.

Q: Should I use other indicators alongside OBV and the 60-day MA?

Adding tools like RSI or MACD might provide additional insights, but they can also lead to overcomplication. Stick to what confirms your core thesis without redundancy.