The 3 Indicators I Use on Every Single Trade (And Why I Ditched the Rest)

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After blowing up two accounts with 14 indicators cluttering my charts, I stripped everything down to three. My win rate went up. My stress went down. Here’s the system.

For two years, my trading charts looked like a Christmas tree.

RSI on top. MACD below. Bollinger Bands wrapping the price. Ichimoku clouds floating in the middle. Stochastic RSI squeezed into the corner. Volume Profile on the right. Fibonacci retracements drawn across three timeframes. VWAP. OBV. Williams %R.

Fourteen indicators, all screaming at me at once.

You can guess how that went. I blew up two accounts — one on a leveraged ETH long in 2022, another on a SOL short during the 2023 rally. Both times, I had “confirmation” from at least six indicators before entering. Both times, the market did what markets do to overconfident traders.

After the second blowup, I did something painful: I wiped every indicator off my charts. Every single one. Then I rebuilt from zero, adding back only what survived a brutal question:

Does this indicator actually change my decision, or do I just like looking at it?

By the end of the process, three indicators remained. That was two years ago. I still use only those three today — for spot, for perps, for scalps, for swings. My win rate climbed from 41% to 58%. My average hold time got longer. My stress dropped dramatically.

Here’s what I kept, why I kept it, and why I’m convinced the rest was noise.

Indicator #1: The 200 EMA (On Every Timeframe I Trade)

The 200-period Exponential Moving Average is the single most watched line in all of crypto. That’s not a flaw — that’s the reason it works.

Markets move on collective behavior. When tens of thousands of traders are all watching the same line to decide whether an asset is “bullish” or “bearish,” that line becomes self-fulfilling. Price respects it because enough money is acting as if it matters.

How I use it

One rule, ruthlessly applied:

I only take longs when price is above the 200 EMA on my trading timeframe. I only take shorts when price is below it.

That’s it. No nuance. No “but the setup looks really good.” If I’m on the 4-hour chart and BTC is trading below the 200 EMA, I don’t long BTC on the 4-hour chart. Period.

This one rule alone eliminated roughly 60% of my previous losing trades. Most of my worst losses came from counter-trend trades where I thought I’d caught “the bottom” or “the top.” The 200 EMA forces me to stop pretending I can call reversals and start trading with the dominant trend.

Why it beats the 50 EMA or 100 EMA

Shorter moving averages catch more trend changes — and more false signals. The 200 EMA is slow, boring, and mostly wrong about the exact turning point. But when it’s right about the direction, it’s right for months at a time. That’s the trade I want to be on: the one that keeps paying out while I sleep.

The subtle use case

Beyond the binary long/short filter, the distance between price and the 200 EMA tells me something about crowding. When BTC is 40% above the 200 EMA on the daily, I stop opening new long positions — not because the trend is wrong, but because the reward-to-risk has collapsed. Mean reversion is coming eventually, and I’d rather be the one buying the pullback than the one holding through it.

Indicator #2: Volume (Not a Fancy Volume Indicator — Just Volume)

This will sound obvious, but bear with me: the vast majority of traders don’t actually use volume. They glance at it. They notice when it’s “big.” They move on.

I treat volume as the lie detector for every other signal on my chart.

The core principle

Price without volume is gossip. Price with volume is news.

A breakout above resistance on weak volume is almost always a fakeout. A breakdown below support on weak volume is almost always a trap for panic sellers. A trend that’s been running for weeks but is now posting declining volume is a trend running out of fuel — and probably about to reverse or consolidate.

I want volume to confirm whatever story the price is telling me. If the price says “bullish breakout” and volume says “nobody actually cares,” I trust the volume.

How I actually read it

I don’t use any fancy volume indicator. No Volume Profile, no VWAP bands, no On-Balance Volume. I just use the standard volume bars at the bottom of my chart, with one simple overlay: a 20-period moving average of volume.

That moving average gives me a reference. When a volume bar is 2x or 3x the average, something real is happening. Whales are moving. News is being priced in. Stops are being hunted. That’s when I pay attention.

Three patterns I watch for every single day:

1. Volume spike on a breakout → trend continuation is likely
2. Volume spike on a reversal candle (especially at a key level) → the trend may be exhausting
3. Extended move on declining volume → a correction is close

The trade I don’t take

If a setup looks perfect but volume is thin — below the 20-period average — I pass. Every time. Crypto is full of algorithmic stop-hunts and low-liquidity chop. Thin volume is where retail gets harvested. I’d rather miss the move than step into a trap that my eyes wanted to believe was a breakout.

Indicator #3: RSI (But Not the Way You Probably Use It)

I know. Everyone uses RSI. Everyone also uses it wrong.

The standard playbook says: “Buy when RSI is below 30 (oversold), sell when RSI is above 70 (overbought).” In a ranging market, that works okay. In a trending market — which is when the best trades happen — it’s a recipe for maximum pain. Strong uptrends can pin RSI above 70 for weeks. Strong downtrends can pin it below 30 for just as long. Traders blindly fading those levels get run over.

So I don’t use RSI for overbought/oversold. I use it for two completely different things.

Use #1: Divergence at key levels

This is where RSI earns its place on my chart.

When price makes a new high but RSI makes a lower high — that’s bearish divergence. The momentum behind the move is fading even though the price is still climbing. When price makes a new low but RSI makes a higher low, that’s bullish divergence, and the selling pressure is exhausting.

I only act on divergence when it occurs at a meaningful level: a prior high, a prior low, a major trendline, or a horizontal support/resistance zone that’s been tested multiple times. Divergence in the middle of nowhere is usually meaningless. Divergence at a level where millions of dollars in stop orders are clustered? That’s a signal worth taking seriously.

Use #2: The 50 level as a trend filter

Here’s the subtle use of RSI that most traders never learn: in a healthy uptrend, RSI tends to bounce off the 50 level on pullbacks rather than diving all the way to 30. In a healthy downtrend, RSI tends to reject at the 50 level rather than climbing all the way to 70.

That means the 50 line on RSI is actually a momentum dividing line. When RSI is holding above 50 on pullbacks, the uptrend is intact. The moment RSI breaks decisively below 50 and stays there, the trend structure is weakening — often well before the price action makes it obvious.

This is my early warning system. By the time a chart visually “looks bearish,” I’m often already out of my long, having exited when RSI failed to hold 50 on the last pullback.

Why I Ditched Everything Else

I hear the objections already:

“But what about MACD? It’s literally the most popular indicator in trading.”

“You don’t use Bollinger Bands? How do you measure volatility?”

“Ichimoku is the most complete system ever designed.”

I’m not saying those indicators are useless. I’m saying they’re redundant.

MACD is a derivative of moving averages. If I’m already trading with the 200 EMA, MACD is giving me a slower, noisier version of information I already have.

Bollinger Bands measure standard deviations of price, which essentially quantifies what I can see with my eyes: a fast move followed by consolidation. Useful, maybe. Necessary? No.

Ichimoku is a full system unto itself — and if you’ve genuinely mastered it, you don’t need my advice. But for 95% of traders using Ichimoku, it’s decoration. Five lines and a shaded cloud create an illusion of rigor that the trader can’t actually translate into decisions.

The real problem with stacking indicators isn’t that any one of them is wrong. It’s that each new indicator gives you another reason to second-guess, another contradictory signal, another way to talk yourself into a bad trade or out of a good one. More information isn’t more edge. Fewer, better-understood signals are more edge.

The System in One Paragraph

I look at a chart. The 200 EMA tells me which direction I’m allowed to trade. Volume tells me whether the current move is real. RSI tells me whether momentum supports the setup, and whether divergence or a 50-level break is warning me that something is shifting.

If all three agree, I take the trade. If any of them disagree, I pass — or wait.

That’s the entire system. A 12-year-old could understand it. A trader with a $10M account could use it.

The hard part isn’t the complexity. The hard part is the discipline to not add a fourth indicator the next time you take a loss and start hunting for a reason.

What I’d Tell My Past Self

If I could go back to the version of me who blew up those accounts in 2022 and 2023, I wouldn’t hand him a better strategy. I’d hand him a piece of paper with this written on it:

Your problem isn’t that you don’t know enough. Your problem is that you know too much and trust none of it. Pick three things. Use only those three. Watch what happens.

That’s the trade I never made — the trade that would have saved me two account blowups and countless sleepless nights.

You don’t need fourteen indicators. You don’t even need six. You need three you genuinely understand, and the discipline to ignore everything else.

Start there. Your equity curve will thank you.

Nothing in this article is financial advice. Trade at your own risk, size your positions responsibly, and never risk capital you can’t afford to lose. Crypto markets are extraordinarily volatile, and no indicator system — including this one — will protect you from a bad risk-management framework. If you liked this, follow for more posts on trading systems, risk management, and the psychology of staying in the game long enough to get good.