How to Use Technical Indicators (Without Getting Wrecked)

Back in May 2021, I watched BTC crater 30% in a day while my feed screamed “buy the dip.” I didn’t. Not because I’m a genius—because my ATR stop said “nope.” That one little rule saved me from a gut‑punch I still feel when I look at the chart. Since then, I’ve treated technical indicators like the dashboard in a race car: I don’t stare at them all race long, but when the RPMs redline, I listen.

Anyway—let’s talk about how to use technical indicators like a trader who’s seen a few cycles, not like a textbook.

Why it matters now

We’re deep into a fresh post‑halving era. On April 20, 2024 (00:09 UTC, block 840,000), Bitcoin’s block subsidy dropped from 6.25 to 3.125 BTC, tightening supply—the classic BTC supply shock everyone talks about around halving events. That’s not lore; it’s code. (en.wikipedia.org)

At the same time, the market’s structure changed. U.S. spot Bitcoin ETFs went live on January 10, 2024, giving tradfi money a compliant on‑ramp and smoothing the flow of capital into BTC. Love it or hate it, that shift boosted liquidity and made technical signals “behave” a bit cleaner on higher timeframes. (techcrunch.com, theblock.co)

And liquidity isn’t just flowing into BTC. Stablecoins have quietly become the market’s bloodstream. By spring 2025, total stablecoin market cap pushed into the $230B–$240B range, with USDT and USDC carrying most of the load. If you day‑trade crypto, you’re trading against those flows whether you see them or not. (coindesk.com)

What are technical indicators?

They’re math—filters on price/volume designed to reveal trend, momentum, and volatility. They don’t predict the future. They frame risk, odds, and timing. Used right, they reduce dumb mistakes. Used wrong, they turn smart traders into indicator tourists.

Here’s how I actually use them.

The core kit I won’t trade without

1) Trend + momentum: MACD (with a trend filter)

What it is: The MACD line is the 12‑EMA minus the 26‑EMA; plot a 9‑EMA “signal line” on top and watch crossovers and the histogram for momentum shifts. I keep default settings on daily/4‑hour. (investopedia.com)

How I use it:

• Big picture: trade in the direction of the 200‑EMA. If price is above a rising 200‑EMA, I weigh MACD bullish signals heavier.

• Entries: I like MACD cross up + histogram turning positive after a shallow pullback in an uptrend.

• Exits: Early warning is a flattening histogram while price grinds higher—tells me to trail tighter.

2) Momentum confirmation: RSI (don’t obsess over 70/30)

RSI measures speed of moves. The classic 70/30 “overbought/oversold” levels are fine, but I care more about RSI structure—higher lows in bull trends, lower highs in bear trends. Divergences matter, especially after long ranges. (investopedia.com)

How I use it:

• Range trades: fade wicks into 70/30 bands when the 200‑EMA is flat and volume is dying.

• Trend trades: ignore “overbought” during strong uptrends—use RSI pullbacks toward 40–50 to add.

3) Volatility + risk: ATR (the adult in the room)

Average True Range doesn’t care about direction; it tells you how much price typically moves. I use 14‑period ATR to set stops and size positions. My base: 2× ATR for swing trades, 1.5× for tighter systems, 3× for volatile alts. For winners, I trail using a “Chandelier” style (e.g., 3× ATR below the highest high). (academy.binance.com, goodcrypto.app)

How I use it:

• Position sizing: Dollar risk / (ATR × multiplier). Higher ATR → smaller size; lower ATR → larger size. Keeps risk steady.

• “Do nothing” signal: If ATR spikes and I’m between levels, I wait. Prevents revenge trades.

4) Context: Bollinger Bands (BB squeezes = watchlist)

BBs are just a 20‑SMA with bands at ±2 standard deviations. I’m not fading every touch; I’m scanning for squeezes. When bands pinch and then price closes outside with volume, I look for follow‑through in the breakout direction—confirmed by MACD/RSI. (investopedia.com)

How to take advantage (playbooks)

• Pullback in trend

1) 200‑EMA rising and price above it.

2) MACD histogram flips up from negative; RSI holds 40–50.

3) Enter on reclaim of prior swing high; stop at 2× ATR; trail at 3× ATR once 1R is banked.

• Range break

1) Bollinger squeeze + multi‑tap resistance.

2) Volume pop on close outside band.

3) Confirm with MACD cross; enter retest; stop 1.5–2× ATR; partials at measured move.

• Mean reversion (only in choppy tape)

1) Flat 200‑EMA, RSI pinging 30/70.

2) Fade the wick into band extremes; tight 1.5× ATR stop; quick scale‑outs.

Quick wins:

• If you’re hedging risk in a shaky macro week, rotate to stablecoins on your base chain and wait for ATR to calm down before redeploying.

• Use RSI divergences to tighten stops, not to call tops.

• One signal is a hunch; two is a plan; three is conviction.

Bitcoin halving, crypto cycles, and indicator timing

Halving compresses new supply; ETFs superfuel demand; stablecoins grease the rails. That cocktail can elongate trends and shorten “dead zones.” Historically, post‑halving expansions often accelerate 6–18 months after the event—but cycles rhyme, they don’t repeat. For me, that means using trend filters (200‑EMA), then letting MACD/RSI time adds while ATR polices risk. The facts: the fourth halving hit block 840,000 on April 20, 2024; the block reward is now 3.125 BTC; and ETF access opened in January 2024—structural shifts you can trade around, not just tweet about. (en.wikipedia.org, techcrunch.com)

Table: Bitcoin halving history at a glance

Halving | Date (UTC) | Block | Reward Before → After

—————————————-

1st | 2012‑11‑28 | 210,000 | 50 → 25 BTC

2nd | 2016‑07‑09 | 420,000 | 25 → 12.5 BTC

3rd | 2020‑05‑11 | 630,000 | 12.5 → 6.25 BTC

4th | 2024‑04‑20 | 840,000 | 6.25 → 3.125 BTC

Data reflects Bitcoin’s programmed issuance schedule and recorded halving blocks. (en.wikipedia.org)

FAQ‑style speed round

How long do cycles last?

There’s no gospel. Past cycles often saw momentum build for 6–18 months after halvings. I don’t time the calendar; I time the trend with MAs/MACD and let ATR govern risk. The moment the histogram stalls and ATR spikes against me, I cool it. (en.wikipedia.org)

What’s the “best” indicator for crypto?

None. The edge is in combining a trend filter (200‑EMA), a momentum read (MACD/RSI), and a volatility guardrail (ATR). Indicators should agree—or you pass.

Are stablecoins an inflation hedge?

No. They’re a convenience and a cash‑management tool. A dollar‑pegged coin holds nominal value; when CPI bites, the peg buys less. If I’m hedging inflation, I’d rather park some dry powder in conservative yield backed by Treasuries than pretend USDT/USDC beat inflation by themselves. As of 2025, stablecoin market depth is massive—that’s the real edge for traders: tighter spreads and cleaner setups. (coindesk.com)

Do indicator settings need to change after the 2024 halving and ETFs?

I didn’t overhaul anything. Post‑ETF liquidity made daily/4‑hour signals cleaner for majors. I still recheck ATR multipliers on alts—they can go feral on headlines. (techcrunch.com)

Real‑world note

In my portfolio, the trade I still replay happened at 2 a.m. after the 2024 halving. Fees were wild, order books thin, and I was itching to chase a breakout candle. ATR said my stop would be too wide for my risk. I passed. Minutes later, the move retraced, then trended the next day—with a tighter ATR and a clean MACD flip. Patience paid me. It usually does. (theminermag.com)

Wrap‑up

Technical indicators aren’t crystal balls. They’re seatbelts. In 2025, with BTC’s issuance cut, ETFs pouring in, and stablecoins lubricating every trade, the best move is boring: ride trend (MAs), confirm momentum (MACD/RSI), size and exit by volatility (ATR). That’s how you survive the chop and harvest the meat of the move. If you want a place to codify rules, set alerts, and keep the human‑error tax low, that’s why I lean on tools like vtrader.io—because discipline beats genius when the charts get brutal.

Sources:

• https://en.wikipedia.org/wiki/Bitcoin_protocol

• https://www.theblock.co/post/271324/the-sec-said-it-has-approved-proposals-for-spot-bitcoin-etfs-on-an-accelerated-basis

• https://www.tradingview.com/news/coindesk%3A1fd2a104e094b%3A0-the-bitcoin-halving-really-is-different-this-time/

• https://www.coindesk.com/markets/2024/04/20/bitcoin-rally-holds-around-63700-following-4th-block-reward-halving

• https://www.investopedia.com/terms/r/rsi.asp

• https://www.investopedia.com/terms/m/macd.asp

• https://www.investopedia.com/terms/b/bollingerbands.asp

• https://academy.binance.com/en/articles/what-is-average-true-range

• https://www.coindesk.com/research/stablecoins-and-cbdcs-report-april-2025