Create a cryptocurrency trading strategy: How to stay against the curve
The world of cryptocurrency trade can be unpredictable as prices are fluctuating quickly and unpredictable. However, with the right strategy and knowledge, traders can gain an advantage on the market and maximize their return. In this article, we will study how to create a market strategy based on market dynamics by helping to make reasonable decisions and remain against competition.
cryptocurrency markets understanding
Before developing a trade strategy, it is necessary to understand the main mechanical in the cryptocurrency markets. For the widest cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH), various market forces are used, including supply and supply, price impulse and global economic trends.
Following the definition of market dynamics
To create an effective market strategy based on market dynamics, you need to understand the following key factors:
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- Market sentiment : The collective attitude of traders, investors and market participants affect prices.
Determination of trade capabilities
With this basis, you can start exposing the trading options that match the dynamics of your market:
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- Market events : Be informed of global economic trends, changes in regulation and other events that may affect cryptocurrency markets.
Creating a trade strategy
Based on the analysis of your market dynamics, you can create a trading strategy that meets your risk tolerance and investment goals:
- Risk management : Set the levels of suspension of loss to limit potential losses.
- Position size : Give the funds according to the parameters of your strategy.
- Input points : Set the optimal entry points based on maintenance and resistance areas.
- Orders to stop loss : Use automatic or manual risk management orders.
Example of Commercial Strategy
To illustrate the trading strategy, let’s look at a simple example using the Bitcoin Market (BTC):
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- “Breakthrough Zone” : Set a significant breakage level of $ 41,500 as a possible purchase signal.
- Entrance Point
: Buy 100 BTC at a price of $ 42,000 (entry point: 0.99 fracture zone).
- Stopping Order : Set a $ 39 800 suspension to ensure that you don’t lose more than 10% due to potential losses.
Additional Tips
Improve your trade strategy and increase its efficiency:
- Be informed
: constantly monitor the market news, analysis and trends.
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- Lay your portfolio : Distribute your investment in multiple cryptocurrency and assets classes.
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Conclusion
In order to create a market strategy based on market dynamics, you need to carefully analyze the understanding of cryptocurrency markets, risk management methods, and understanding of the main mechanics.
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