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The Quest for the Trading "Holy Grail": A Realistic Perspective Discover why the concept of a trading "holy grail" is more myth than reality. Why successful trading involves understanding market uncertainties, human behavior, and adaptable strategies? Experienced traders know: there's no magical "holy grail" guaranteeing 100% profits. In truth, consistent traders recognize losses as much a part of trading as gains. Despite this, a stream of novice traders still seek the one-size-fits-all path to profitability. Consider these three reasons why discovering a trading "holy grail" is as likely as reaching the sun: Unpredictable Market Uncertainties: The market's complexity thwarts all-knowing predictions. Influences are countless, making extended manipulation improbable. Unless you've got superpowers foreseeing central banker statements or impending crises, the holy grail remains elusive. Human Behavior Influences Markets: Human decisions continue to shape market dynamics. While automated systems play a role, it's human actions that cause market fluctuations. Trading opportunities emerge from discrepancies between price and value, often influenced by individual interpretations. Variations in approaches, like Nick vs. Mike, and factors like John's hesitance to cut losses, contribute to market complexities. Adaptable Strategies are Essential: Market patterns echo human behavior, but shifting conditions render "surefire" systems obsolete. The ebb of trend-following tools demonstrates adaptability's importance. Profits hinge on discretion, recognizing pattern shifts, and mastering risk management. Remember, a holy grail isn't essential for trading success. Full-time and part-time traders alike profit with prudent risk management. Understanding of risk management — your keys to sustainable trading success.

Education

Using the Research Method in Trading Greetings, fellow traders! Trading is both an art and a science, and the research method is your secret weapon to unraveling market intricacies. It's about adopting a systematic approach, making informed decisions, and refining your strategies based on solid data. Applying a analytic mindset in trading can offer a valuable edge. Let's explore the basics of the research method and how you can integrate it into your trading practices. Start with Observation: Just like scientists, traders begin by carefully observing the markets, noting patterns, and identifying repeat occurrences or random incidents. This process helps build a comprehensive understanding of market factors, that influence price action. Formulate Hypotheses: Based on your observations, create hypotheses or assumptions to explain market behavior. These hypotheses act as initial theories that can be tested for validity. Test Your Hypotheses: Conduct empirical tests by taking trades, that align with your hypotheses. Record the results and analyze how price action unfolds. Keep a detailed trade journal to document your observations. Embrace Open-Mindedness: Remain open to new data and market complexities. The markets are ever-changing, and no hypothesis is an absolute truth. Be prepared to adjust your trading strategies based on new information and shifts in market sentiment. Fine-Tune Your Trading Plan: Use the insights gained from testing your hypotheses to fine-tune your trading plan. Continuously refine your strategies based on new observations, and be flexible in adapting to changing market conditions. Treat Each Trade as a Learning Opportunity: View each trade as a source of valuable information, regardless of the outcome. Learn from both winning and losing trades to enhance your understanding of the markets and improve your trading approach. By integrating the research method into your trading routine, you can enhance your decision-making process, manage risks more effectively, and avoid overconfidence. Stay curious, keep learning. Happy trading!

Education

Understanding the Learning Curve Welcome to @Vestinda new article about Learning Curve! We are delighted to share this insightful piece with our valued community on @TradingView ! At Vestinda, we believe in empowering traders with knowledge and tools to navigate the cryptocurrencies and futures trading. In this article, we will explore the concept of the learning curve and its relevance to the trading journey. Whether you are a novice trader or a seasoned professional, understanding the learning curve can be instrumental in your path to success. If you focus and invest time into a subject, you will eventually reach a level of mastery. The actual level clearly depends on the amount of invested time and to a significant extent on your inherent abilities to acquire the specific knowledge. I could probably spend a decade on quantum physics and not progress beyond the level of ‘enthusiastic beginner'. However, attaining mastery is seldom a smooth and linear journey. It is more like a curve in the mathematical sense, characterized by uneven ups and downs, reflecting the usual 'bumps in the road' that we all experience when dealing with challenging topics. There is a pattern in the process of learning something new (knowledge, skills, etc.), which was formulated by the American psychologist Albert Bandura. This pattern is depicted in the form of a graph known as the Bandura curve. The graph demonstrates the relationship between time (number of attempts), the level of human competence in what they are studying, and their expectations. If you have ever enthusiastically started a new training, holding high hopes for it, and then quietly gave up, blaming others or anything else, then you are not alone. To avoid repeating this in the future, it's important to understand how human psychology and the system work, and that each of us is part of this system. Below, we will provide recommendations on what to pay attention to. So, the Bandura curve shows the stages a person goes through when beginning to learn something new. 1. Clueless (You don't know what you don't know) When you first venture into trading cryptocurrencies and futures, you are essentially clueless about the intricacies of the market. The concepts, strategies, and tools may seem foreign and overwhelming. It's like staring at a vast landscape without a map, unsure of where to even begin. 2. Naively confident (You think you know, but still don't know what you don't know) As you begin your learning journey, you might gain some basic knowledge and techniques. This newfound understanding might lead to a sense of naively confident. You believe you have a handle on things, but in reality, there's a lot you're still unaware of, and the market can surprise you with unexpected turns. 3. Discouragingly realistic (You know what you don't know) With more experience, you come to a point of realization that there is much more to learn. The challenges and complexities of trading become evident, and you may face setbacks that test your resolve. It can be a discouraging phase as you grapple with the reality of how much you still need to learn. 4. Mastery achieved (You know it) Through persistence and a commitment to learning, you gradually achieve mastery in trading cryptocurrencies and futures. You've gained a comprehensive understanding of the market dynamics, developed effective strategies, and learned how to manage risks. You can now navigate the market with confidence and consistently make informed decisions. Remember: The learning curve in trading is a natural part of the process, and each stage brings its own valuable lessons. Don't be disheartened by challenges or setbacks; they are opportunities to grow and improve your trading skills. WHAT TO DO? ✅ Embrace the journey of learning and growth, recognizing that mastery takes time. ✅ Stay humble and open-minded, acknowledging that there is always more to learn. ✅ Be patient with yourself during the challenging phases and use them as motivation to improve. ✅ Keep refining your strategies and adapting to the ever-changing market conditions. Can you identify which stage you are currently in your cryptocurrency and futures trading journey? Remember, each stage brings you closer to becoming a proficient trader. We hope you found this article on understanding the learning curve in trading cryptocurrencies and futures helpful! If you have any thoughts, questions, or personal experiences related to the topic, we'd love to hear from you. Please share your feedback in the comments below. Your input is valuable to us and can help us create more content that resonates with your interests and needs. Thank you for being part of our community!

Education

The Pyramid of Trading Success Greetings, esteemed members of the @TradingView community and all Vesties out there! The Pyramid of Trading Success is a conceptual model that outlines the fundamental principles and steps needed to achieve success in the trading world. It serves as a guiding framework for traders to build a strong foundation and gradually ascend towards becoming proficient and profitable in their endeavors. The pyramid consists of several layers, each representing a crucial aspect of trading mastery: 1. Emotional Well-being / Financial Stability / Trustworthy Broker (Base of the Pyramid) Sought-after Qualities: Self-awareness, Constructive Self-evaluation, Rational Thinking, and Objectivity. Prioritizing emotional well-being and financial stability is essential in the world of trading. Maintaining self-awareness allows you to understand your emotions and reactions, helping you make better decisions. Engaging in constructive self-evaluation enables you to learn from mistakes and improve your strategies. Rational thinking and objectivity ensure you approach trading with a clear and level-headed mindset. Additionally, choosing a trustworthy broker is crucial for the security of your funds and the overall integrity of your trading experience. 2. Robust Safety System Practice swift loss-cutting, avoid unreliable cryptocurrencies and low-quality stocks, refrain from gambling, and abandon the notion of overnight riches. Implementing a robust safety system is paramount in trading. Swift loss-cutting helps limit potential losses and protects your capital. Avoiding unreliable cryptocurrencies and low-quality stocks minimizes risk and safeguards against scams. Refraining from gambling ensures that you approach trading as a calculated investment, not a game of chance. Finally, abandoning the notion of getting rich overnight fosters a long-term and sustainable approach to achieving financial success. 3. Portfolio Management Rely on statistics and discard ineffective approaches. Monitor market trends regularly, consider long-term goals, stay informed about economic indicators. Effective portfolio management relies on a statistical approach to decision-making. By analyzing historical data and trends, you can make informed choices and discard strategies that have shown ineffective results. Regularly monitoring market trends helps you stay on top of changes and adapt your portfolio accordingly. Considering long-term goals ensures that your investment decisions align with your overall financial objectives. Staying informed about economic indicators provides valuable insights into the broader market conditions that may impact your portfolio. 4. Asset allocation Diversify your investments to spread risk. Requires years of experience in trading financial markets. Asset allocation is a key strategy to manage risk and optimize returns. Diversifying your investments across various asset classes, industries, and geographies helps reduce the impact of market fluctuations on your overall portfolio. Achieving effective asset allocation often requires years of experience in trading financial markets to gain a comprehensive understanding of different investment opportunities and their performance characteristics. 5. Tools Conduct backtesting of your strategies and consider automating your investments. Utilizing the right tools is crucial for successful trading. Backtesting allows you to test your strategies on historical data to evaluate their performance before implementing them in real-time. This helps refine your approach and increase the likelihood of success. Additionally, automating your investments can streamline the execution process, ensuring timely responses to market conditions and minimizing emotional biases. Here are simplified steps for strategy backtesting: Define strategy parameters, financial market, and chart timeframe for testing. Search for trades based on the specified strategy, market, and timeframe. Analyze price charts for entry and exit signals. Record all trades and calculate the gross return (including both winning and losing trades). Deduct commissions and trading costs from the gross return to find the net return. Compare the net return to the capital used to calculate the percentage return over the specified timeframe. 6. Remaining Focusing on the essentials covered in the first five points is critical for your success as a trader. Avoid getting distracted by other less crucial elements such as social trading or overly complex indicators. While indicators can be useful tools, it's important to remember that they are derived from basic price and volume data. Instead of searching for elusive patterns or magical chart overlays, devote your time to mastering the fundamental principles discussed earlier. This disciplined and pragmatic approach is more likely to yield tangible results in your trading journey. By following the Pyramid of Trading Success, traders can develop a comprehensive and methodical approach to trading, increasing their chances of achieving sustainable success in the dynamic and challenging world of financial markets. We would greatly appreciate your valuable feedback on our article about the Trading Pyramid. Your opinion matters to us, and your insights can help us improve our content and tailor it to better meet your needs.

Education

Short opportunity in Nasdaq QQQ You can see the top and bottoms curves, top curve is peaking and bottom curve is flattening. Risk is low to the upside with daily stop losses following the curve. Conservative 3.5% to the downside in next 15 days. We also see double divergences in top and bottom trends on the Relative Trend Index, RTI could give third peak in next 8 days to confirm. Below 363 we have an acceleration to the downside of 5-7% additional, for a total downside of 7-10% in next 3-4 weeks. I have a short position in QQQ currently.

Short

Updated

Unveiling the Secrets: The Road to Forex Success My todays topic is Unveiling the Secrets: The Road to Forex Success - Proven Strategies to Safeguard Capital and Skyrocket Profits! . In the realm of foreign exchange trading, novice traders often encounter challenges as they embark upon their journey in the forex market, resulting in unfortunate losses of their capital. Regrettably, due to my current absence of a Trading view subscription plan, I am unable to provide illustrative visual aids to enhance the efficacy of this discourse. Nonetheless, I intend for this post to serve as an educational resource, infused with a technical perspective, wherein I delve into an analysis of the GBPUSD chart. Introduction Foreign exchange (forex) trading is an enticing financial market that offers vast opportunities for individuals to make profits. However, for beginner traders, the journey can be challenging, as they often encounter numerous obstacles and experience losses. Understanding the reasons behind these losses is crucial for aspiring traders to develop effective strategies that minimize risk and increase the probability of success. In this article, we will explore the primary factors contributing to why beginner traders often lose money in forex and present key strategies to mitigate those risks. Lack of Proper Education and Knowledge One of the fundamental reasons why beginner traders struggle and lose money in forex is a lack of proper education and knowledge. Forex trading is not a game of luck or intuition; it requires a deep understanding of fundamental and technical analysis, market dynamics, and risk management. Unfortunately, many beginners dive into the market without a solid foundation, making them vulnerable to costly mistakes and falling victim to misleading trading signals or unreliable strategies. Strategy: Prioritize Education and Continuous Learning To minimize the risk associated with inadequate knowledge, beginner traders should invest time and effort in acquiring a comprehensive education on forex trading. It is essential to understand key concepts such as fundamental and technical analysis, risk management, and trading psychology. Engaging in online courses, reading educational materials, and utilizing demo trading accounts can provide invaluable hands-on experience. By continually expanding their knowledge and staying updated with market news, beginners can make more informed trading decisions and reduce the likelihood of losses. (a) Lack of Discipline and Emotional Control Emotions play a significant role in forex trading, and for beginners, learning to manage emotions can be particularly challenging. Greed, fear, and impatience often lead to impulsive trading actions, such as chasing profits, failing to cut losses, or overtrading. These emotional responses tend to cloud beginners' judgment and hinder their ability to make rational decisions based on market analysis. Strategy: Develop and Stick to a Trading Plan Developing a well-defined trading plan is crucial for beginner traders to minimize emotional interference. A trading plan outlines specific entry and exit points, risk tolerance, and profit targets based on a thorough analysis of market conditions. By strictly adhering to a pre-established plan, beginners can reduce impulsive actions driven by emotions, thus minimizing risk and enhancing overall consistency. Additionally, maintaining a trading journal to track and evaluate performance can help identify areas for improvement and promote discipline. (a) Inadequate Risk Management Effective risk management is essential for all traders, especially beginners. Without proper risk management techniques, beginners expose themselves to substantial losses. Not setting appropriate stop-loss orders, risking too much capital on a single trade, or failing to diversify the portfolio are common mistakes that contribute to beginners' financial setbacks. Strategy: Implement Strong Risk Management Tools To mitigate risk, beginners should employ various risk management tools. Setting stop-loss orders at logical levels is crucial to limit potential losses. Beginners should also determine a suitable risk-to-reward ratio for each trade and avoid risking more than a predetermined percentage of their capital. Diversifying the portfolio by trading multiple currency pairs can also help distribute risk. Regularly reviewing and adjusting risk management parameters, such as trailing stops, can further protect capital and minimize losses. (a) Lack of Realistic Expectations Beginner traders often fall into the trap of unrealistic expectations, anticipating quick and substantial profits. However, forex trading is a complex market, and consistent profitability takes time and experience. Unrealistic expectations can lead beginners to take excessive risks, overtrade, or give in to the allure of get-rich-quick schemes, ultimately resulting in financial losses. Strategy: Set Realistic Goals and Focus on Long-Term Success Setting realistic goals is crucial for beginner traders. Instead of aiming for overnight wealth, beginners should focus on building a solid foundation and gaining experience over time. Patience, persistence, and a long-term mindset are essential for navigating the forex market successfully. By setting achievable goals and embracing a gradual learning curve, beginners can reduce the pressure to make hasty and uninformed trading decisions. Conclusion For beginner traders, the forex market can be a challenging environment where losses are common. However, by understanding the reasons behind these losses and implementing effective strategies, beginners can minimize risks and increase their chances of success. Prioritizing education, maintaining discipline, implementing proper risk management techniques, and setting realistic goals are all essential components for beginner traders to navigate the forex market with confidence. Remember, forex trading is a journey that requires continuous learning and adaptation. With the right approach and mindset, beginners can overcome obstacles and strive for consistent profitability in forex trading.

Education

Psychology and Trading: Conquering FOMO 🔥 Do you ever feel the Fear of Missing Out (FOMO) when trading? 🔥 It's a common struggle, but fear not! In this post, I'll share five crucial points that have been instrumental in helping me gain control over my psychology throughout my trading journey. 😎 Embrace the Unpredictability: The market is a wild ride, and it can change direction in the blink of an eye. Even the best setups can turn into losses within seconds. So, keep a neutral mindset! Recognize that prices can move in any direction, and be ready to adjust your bias as market structures develop. By staying neutral, you can reduce your emotions and build a strong trading psychology. 💪 Master Risk Management: Risk management is the holy grail of trading. Without it, you're just gambling. Losses are inevitable, but by limiting your risk to a small percentage (e.g., 1%), you can protect your capital and keep trading. Consistently managing risk and maximizing your reward-to-risk ratio will compound your profits and overshadow any losses. ⏳ Patience Pays Off: Don't chase after every trade. If you miss an entry, don't panic! There will always be new opportunities that fit your trading plan. Impulsively chasing volatility leads to revenge trading, greed, and unnecessary losses. Stay disciplined and wait for confirmation before jumping into a trade. 🚫 Leave Your Ego Behind: Your ego has no place in trading. Just because you think the price will hit your target doesn't mean it will. Profitability comes from taking what the market offers. Be humble and flexible, adjusting your trades according to the market's behavior. This mindset shift will help you avoid costly mistakes. 📝 Craft a Solid Trading Plan: Want to succeed? Have a well-defined trading plan! It's your compass in the chaotic market. Identify profit targets, stop levels, and entry/exit points. Stick to your plan with unwavering discipline. Consistency and emotional control are key to achieving your trading goals. 📈 Remember, there's no one-size-fits-all approach in trading. Each trader has their own style, plan, and mindset. As long as you follow your plan and your decisions align with your criteria, you're on the right track. At @Vestinda we hope you found these tips helpful! Trading is a journey of self-improvement and constant learning. By applying these principles, you'll gain better control over your psychology and increase your chances of success. Keep exploring, stay curious, and never stop honing your trading skills! 🤗

Education

EDUCATION: How to trade forex?Trading foreign currency on the forex market, also known as foreign exchange trading, can be an exciting hobby and a lucrative source of income for many people. Currently, the stock market trades about $22.4 billion per day, while the forex market trades around $5 trillion per day. There are various ways you can engage in online forex trading. 1. Learn basic forex terms. - The currency you are using, or selling, is the base currency. The currency that you are buying is called the quote currency. In forex trading, you will sell one currency to buy another. - The exchange rate tells you how much you have to spend in the quote currency to buy one unit of the base currency. - A long position means you want to buy the base currency and sell the quote currency. In our example above, you want to sell dollars to buy pounds. - A short position means you want to buy the quote currency and sell the base currency. In other words, you sell British pounds and buy US dollars. - The bid price is the price the broker is willing to buy the base currency for in exchange for the quote currency. The bid price is the best price at which you want to sell your quote currency in the market. - The ask price, or ask price, is the price at which the broker sells the base currency in exchange for the quote currency. The asking price is the best you are willing to buy from the market. Spread is the difference between the bid price and the ask price. 2. Specify the currency you want to buy and sell in. - Forecasting the economy. For example, if you believe the US economy will continue to weaken, and this is not good for the US dollar, you may therefore want to sell dollars in exchange for currency from a country with a strong economy. . - View a country's trading position. If a country has a lot of popular goods, it may export goods to make a profit. This trade advantage will boost economic development, thereby helping to boost the value of this country's currency. - Political review. If a country is holding an election, its currency will appreciate if the winner of the election has a fiscally biased agenda. In addition, if a country's government loosens regulations on economic growth, this will push up the value of the currency. - Read economic reports. A report on GDP, or on other economic factors such as employment and inflation, of a country will have an effect on the value of that country's currency. 3. Learn how to calculate profit. - Use the unit "pip" to measure the change in value between two currencies. Usually, one pip equals 0.0001 change in value. For example, if the EUR/USD rate increased from 1.546 to 1.547, then the value of your currency has increased by 10 pips. - Multiply the number of pips your account changes by the exchange rate to find out how much your account value has increased or decreased. 4. Market analysis. You can try several different methods such as: - Technical Analysis: Technical analysis is looking at charts or previous data to predict the direction of currency movement based on past events. The broker will usually provide you with a chart, or else you can use a popular platform like Metatrader 4. - Fundamental Analysis: This analysis involves looking at the economic background and character of the country and based on this information to make trading decisions. - Psychoanalysis: This type of analysis is largely subjective. You're basically trying to analyze market sentiment to figure out if the market is trending "bearish" or "bullish." While market sentiment cannot always be certain, you can still make some guesses, and this will positively impact your trading. 5.Define margin trading. Depending on the broker's policies, you can invest little money and still make big trades. - For example, if you want to trade 100,000 units with a margin of 1%, the broker will ask you to put $1,000 in cash in your account for safety. - Both profit and loss will be added or deducted from the account. For this reason, the best general rule is to only invest 2% of your cash in a particular currency pair. 6. Advise. - Try to use only about 2% of your total cash. For example, if you decide to invest $1,000, try using only $20 to invest in a currency pair. Prices in Forex are very volatile, and you have to make sure you have enough money to spend when the currency pair price drops. - Try using a demo account to make forex trades before investing real capital. That way you can be sure of the process and definitely should you join forex trading. After you always make the right trading decisions with a demo account, you can start doing it with a real forex account. - Limit losses. Let's say you have invested 20 USD in EUR/USD currency pair, and today you have lost 5 USD. But you haven't lost your money yet. It is important that you only use about 2% of your cash back per trade, plus a stop loss with that 2%. You still have enough capital to cover this period so you can keep the position from closing and make a profit. - Remember a loss is not a loss unless your position is closed. If your position is still open, your loss will only be calculated if you choose to close the position and take the loss. - If the currency pair moves against your will, and you do not have enough funds to cover it during this time, your order will be automatically cancelled. Therefore, you must make sure not to make this mistake. 7. Warning. - More than 90% of day traders fail. If you want to learn the common pitfalls that cause you to make bad trading decisions, consult a trusted fund manager. - Check to make sure that the brokerage firm has a specific address. If the broker does not provide an address then you better find someone else to avoid being scammed.

Education

by Sphyn-Trader

EDUCATION: The most common model patterns!Hello traders, I present to you a few candlestick patterns that appear frequently and have a fairly large win rate. CUP AND HANDLE The cup and handle pattern on the price chart resembles a cup with a handle, where the cup is U-shaped and the handle slopes down slightly. The cup forms after moving upwards and looks like a bowl or round bottom. When the cup is completed, a narrow price range develops on the right side and a handle is formed. A subsequent breakout of the trading range forms the handle indicating a continuation of the previous upward move. PENNANT PATTERN This is a type of continuation pattern that forms when there is a major move in the market, known as a flagpole, followed by a period of consolidation with converging trendlines, pennants, and finally a move. breaks in the same direction, like the original move, representing the second half of the flagpole. FLAG The flag pattern is used to determine the possibility of a continuation of a previous trend from a point where the price has drifted in the same trend. If the trend continues, the price could rise rapidly, making it an advantageous time to trade using a flag pattern. If you think you've seen a flag to trade, the most important thing is a fast and steep price trend. If the price slowly rises and falls below the flag, you should not trade at that time. DOUBLE BOTTOM The trajectory of the price line during the formation of the pattern resembles the letter "W". The last two price lows, located approximately the same, are a strong support zone where two price reversals are made to the upside. When the market price breaks through the resistance level of the pattern, the formation of the pattern is complete. The BUY signal appears and the trend will change.

Education

by Sphyn-Trader

EDUCATION: DCA with Trader!What is DCA? How to use the price averaging strategy to increase profits DCA or price averaging strategy can be an effective way to manage risk when investing in assets like stocks, cryptocurrencies… I will walk you through how it works and its pros and cons. for easy understanding. When considering investment, if you have a large amount of money in hand ready to invest. DCA is a method that can be suitable for both experienced and new investors to reduce the risk of seeing how their investments decline in value. What is DCA? - DCA (price averaging strategy) is a method of breaking down capital to invest in a fixed and more frequent way over a long period of time. - This is a smart investment strategy. However, you must not confuse it with the fact that you bottom out the price of an asset when it drops deep to buy at a good price. - DCA is really good if you correctly predict the trend by analyzing the market. And of course, the price averaging strategy must involve technical analysis or specifically instrument indicators such as MA, MACD, Bollinger bands, Elliott waves, etc. Bitcoin problem using DCA Now do a math on Bitcoin investment for you to visualize. Problem 1: Buy Bitcoin once with all assets This is the case I think is mostly true for newcomers to the market. For example, you have 10000$ and buy it all with bitcoins for 8000$. You get 1.25 BTC. Then Bitcoin achieves the gain/loss that you want to sell, then we will have a profit/loss table with the selling prices as follows: - SELL at 6000$ = Take Profit -2000$ - SELL at 12000$ = Take Profit 2000$ - SELL at 14000$ = Take Profit 4000$ This is a basic math problem. The next step is to use the average price of your capital. Try it out and see how it turns out. Here, I will divide according to market developments so that you can consider it in the most comprehensive way. Problem 2: DCA in a bear market This is a problem that makes the DCA method really shine. Now, let's say the plan with the capital of 10000$ above will buy in batches. Divide the capital into 4 times, so use $ 2500 for each installment. Proceed to buy bitcoin at 8000, 6000, 5000, 3000. So after 4 such purchases the number of Bitcoins you hold is 2.0625 BTC. After that BTC returns to the upside, you will calculate profit and loss at the prices if you sell as shown in the table below: - SELL at 4000$ = Take Profit -1750$ - SELL at 10000$ = Take Profit 10625$ - SELL at 12000$ = Take Profit 14750$ Do you see that if the expectations are right, the profit will be huge. When bitcoin fell, you increased your holdings more than you could buy once. Investment capital increased as BTC price increased with a total profit of ~1.5 times when selling at $12000. Problem 3: DCA in a sideways market When the market moves sideways for a year, for example, the price moves in a narrow range. You can buy bitcoin in 4 batches at the prices 8000, 7500, 7000, 6000. With these buying prices you will buy 0.877976 BTC. You can see it's similar to a one-time purchase with all capital, right? The market can move sideways, up and down. But end up where they started in the long run. However, you will never be able to accurately predict where the market is headed. If bitcoin had moved even lower, rather than higher, the price average would have allowed for even bigger profits. This is where you make sure you have long-term profits, not just immediate ones. Problem 4: DCA in a rising market In this last problem, also divide the capital of 10000$ into four installments for 5000, 6500, 7000, 8000. So after 4 purchases you have 1.55 BTC. When the price increases, you have the profit and loss in the following table: - SELL at 4000$ = Take Profit -3800$ - SELL at 6000$ = Take Profit -700$ - SELL at 8000$ = Take Profit 2400$ This is a problem where DCA performs a bit poorly, at least in the short term. Bitcoin rallied higher and then continued higher. Therefore, price averaging does not help you maximize your profits. This one involves buying the whole thing in one go. But unless you are making short term profits, this is a rare scenario in life. Bitcoin can evaporate, kkk. So, if you are investing for the long term, it is advisable to spread the capital in the trades. Even if that means you have to pay more at a certain price. Is the price averaging strategy really good? In general, the price averaging strategy offers three main benefits that can lead to better returns: Avoiding market fomo, avoiding market confusion, Long term investment thinking. Because investors often fluctuate between fear and greed. They tend to make emotional trading decisions when the market reverses. However, if you use DCA, you will buy when people are selling in fear (green quit, red watch, kkk). Get a good price and set yourself up for a long profit. Markets tend to move up over time, and averaging prices can help you realize that a bear market is a great long-term opportunity. Instead of being afraid of things. Limitations of the average DCA method The first, perhaps the most discussed, is the modest profit. More frequent purchases increase transaction costs. However, with exchanges charging less transaction fees, this cost becomes more manageable. Furthermore, if you are investing for the long term, the fees will become very small compared to your overall portfolio since you are buying for long term investment purposes. Binance is my top choice because of its diverse ecosystem and reasonable fee schedule. Second, you can forego the profit you would have earned if you had invested in a one-time purchase and the property you purchased appreciates in value. However, the success of trading largely depends on identifying the market correctly when predicting the short-term movement of an asset class. This is done by famous and good analysts.

Education

by Sphyn-Trader

What is the EMA? How to use EMA most effectively!What is EMA? EMA or Exponential Moving Average (EMA) – An exponential moving average (EMA) is a type of moving average (MA) that is based on a weighted exponential formula that is more responsive to changes recent prices, compared to a simple moving average (SMA) that only applies equal weight to all periods, helping the EMA to smooth the price line more than the SMA. What signals does the EMA provide to traders? Moving averages offer a significant benefit by offering clear insight into price trends. In other words, the Exponential Moving Average (EMA) cannot exceed or remain above the price line unless the price is increasing. Similarly, it cannot be below the price line if the price is not actually decreasing. This is crucial for traders as it provides a distinct and reliable indication of the price trend, avoiding any ambiguity. The trend is essential in helping traders identify entry points. The EMA will become a dynamic resistance, because it moves in the direction of the price, which means where the price goes, the EMA will follow. Become dynamic support and resistance levels (these resistance levels can be used to compare the trendline, support and static resistance lines). From here will look for entry points, stop loss and take profit points. Identify price trends. Which EMA should be used most appropriately? EMA 9 or EMA 10: This number represents a two-week period of trading, making EMA9/EMA10 commonly used for short-term transactions. EMA 34/EMA 89 are used to align with the primary waves as per the Elliott wave theory. EMA 20, EMA 50, EMA 200 are closely associated with trading sessions. Over the course of a year, we can typically trade for around 200 days, accounting for holidays and breaks. EMA50 represents the medium term, corresponding to the four seasons in a year, with each season having approximately 50 trading sessions. Similarly, EMA 20 represents the month. Some traders also utilize the 250 EMA in addition to the 200 EMA, believing that 250 represents the number of trading days in a year. EMA100 is a commonly chosen EMA due to its round number value. Round numbers are often seen as psychological barriers in trading. Compare trendline with EMA: As mentioned earlier, EMA is another way to identify trends, just like the trendline. To better understand this concept, the trendline can be seen as a fixed resistance. Once you draw a trendline, it will act as a reference point for the price. On the other hand, EMA is a dynamic resistance. It moves along with the price line. Unlike the trendline, EMA closely follows the price line because it is calculated based on the price itself. This makes EMA more accurate in showing the trend. It can clearly indicate whether the price is above or below the EMA. Some notes with EMA: - When the price surpasses or falls below the EMA, but then retreats below it again, it indicates a strong downtrend or uptrend. - If the price strays too far from the EMA, it is advisable to wait for it to correct itself and return to the EMA before considering any trading actions. - Fast EMAs or short period EMAs are more sensitive to price movements compared to slow EMAs, but they are also more prone to breakdowns. This can be advantageous as it allows for early trend identification compared to the SMA. However, the EMA is likely to experience more frequent short-term fluctuations compared to the corresponding SMA. - EMAs act as dynamic resistance levels that consistently track the price line. - The EMA is not primarily used for pinpointing exact tops or bottoms. Instead, it assists traders in aligning their trades with the prevailing trend. - The EMA always has a delay, making the SMA more useful in sideways markets, while the EMA is more effective in clearly trending markets. Thank you @TradingView !

Education

by Sphyn-Trader

Updated

The Trojan Horse of Trading The Trojan Horse was a wooden horse used by the Greek army to enter the city of Troy and win the war. Although the inhabitants of the town had initially perceived the horse as a victory trophy, Greek fighters emerged from inside of it and destroyed the city. "Yeah, that's a nice story. But how the heck is it related to trading?" Let us clarify. Trading is generally considered as one of the "easiest hardest" ways of making money. Upon learning about the limitless number of opportunities provided by the financial markets, newbies get excited and believe in the false promises offered by some "John Smith FX Trader" on Instagram that drives a purple Lamborghini and posts demo account profits. To be less cruel and offending, newcomers think they can become consistently profitable full-time investors/traders almost instantly. Hence, we compare trading to the Trojan Horse that is full of "big sharks" such as institutional traders, hedge funds, market manipulating brokerage firms and so forth. In this case, retailers act as residents of the city of Troy and perceive the horse as a gift dedicated for the triumph. Undoubtedly, as already stated, the world of trading presents a vast number of opportunities that one can benefit and make profits from. However, the drawbacks should not be discarded either. Illustrated, we can find some of the hardships that are hiding behind the glamorous GUCCI bags, Shangri-La hotels, Michelin starred restaurants and Bentley sport-cars.

Education

The Struggle of Consistency: Navigating DCA in Crypto Investing Hello dear @TradingView community! Today let’s focus on what is Dollar Cost Averaging ? Determining the optimal moment to buy cryptocurrency is often a challenging task due to the high volatility of crypto assets. Prices can fluctuate unpredictably at any given time, leading traders to experience the fear of missing out (FOMO). This fear is commonly felt when the price of a cryptocurrency, such as Bitcoin (BTC), suddenly surges or plunges. During price drops, individuals tend to panic and sell their holdings in a frantic attempt to avoid further losses. Conversely, when prices rise, panic ensues as people worry they don't possess enough coins to sell. As evident, making decisions to buy or sell cryptocurrencies is no easy feat. However, if you seek long-term financial gains from cryptocurrencies without succumbing to the anxiety caused by every price spike, it would be wise to consider the Dollar Cost Averaging (DCA) strategy. Let's delve deeper into what DCA entails and how it functions in the realm of cryptocurrencies. What is Dollar Cost Averaging? Dollar cost averaging is an investment strategy where fixed amounts are regularly invested at consistent intervals, in contrast to a one-time lump sum investment. This approach involves executing transactions regardless of the asset's current price or market fluctuations. It is highly favored by investors and management funds seeking long-term profits from various assets like ETFs, commodities, cryptocurrencies, stocks, and more. How does DCA work? To employ the DCA strategy, you first determine the amount of cryptocurrency you wish to invest. In conventional investing, one would typically invest the entire designated sum in a specific asset. However, with DCA, you invest fixed amounts of USD into Bitcoin or any other asset over a designated period. For instance, you may choose to purchase $100 worth of BTC every month for a 10 year period. When utilizing DCA, the selection of the cryptocurrency becomes crucial. With around 22,904 cryptocurrencies available today, you must pick a coin you believe will appreciate in value and yield profitable returns. You can even choose an ETF which follows the trend (up or down) for any specific asset or basket of assets. To comprehend how DCA operates, consider the following example: Let's assume it is June of 2014, and Katie decides to allocate $10,000 in BTC. In June of 2014, the price of Bitcoin stood at approximately $560 per coin. Instead of investing the entire sum at once, Katie opts for dollar cost averaging throughout the 9 years. From June 2014 to May 2022, Katie spent $100 each month on BTC, disregarding market price fluctuations. After 8 years, she spends almost $9,600 and her earnings reflect the following: The green line in the chart represents Katie’s total investment amount, while the orange line depicts the fluctuation of portfolio size value over the 9-year period. When Katie initiated his investments, both the cost of BTC and his investments were approximately $100. However, as time progressed, the price of Bitcoin underwent changes. By May of 2022, Katie's $9,600 investment had grown to $287,518 worth of BTC, showcasing a growth rate of 2,895%. With maximum gain of $631,540 at bitcoin ATH. Online DCA tools are also available to estimate the earnings from purchasing bitcoins over several months. For example, platforms like dcaBTC enable users to customize their DCA strategy according to their preferences, specifying the amount to purchase, investment frequency, and duration. To successfully implement dollar-cost averaging (DCA) in Bitcoin investing, several key steps need to be followed. These steps involve setting a budget, choosing a reputable cryptocurrency exchange, establishing recurring purchases or utilizing recurring purchases and automated investment platforms (such as Binance, Coinbase, Kraken, Crypto.com or even at Vestinda), and monitoring and adjusting the strategy as necessary. Pros and Cons of Dollar Cost Averaging Let's commence with the pros of dollar cost averaging. By making regular and consistent purchases over time, you mitigate the risk associated with poorly timed lump sum investments. Additionally, since you make regular purchases, you alleviate the fear of missing out and impulsive decision-making prompted by price fluctuations. Cryptocurrency exchanges and platforms charge transaction fees for every trade. While one might assume that DCA would result in higher commission fees, it is essential to remember that this is a long-term strategy. The commission costs are negligible compared to the potential profits that can be realized over several years. Moreover, DCA does not necessitate substantial investments. This strategy involves smaller and consistent purchases, eliminating the need to determine how best to deploy a large sum in one go. Furthermore, if prices suddenly drop at the time of purchase, you can acquire the cryptocurrency at a lower price. However, it is important to note that if the cryptocurrency's price is bullish, you may end up buying at a higher price. This is particularly relevant when dealing with BTC or any chosen cryptocurrency. Many crypto enthusiasts and investors prefer to purchase a significant amount at once, fearing a subsequent price surge in the hours, days, weeks, or months to come. As previously mentioned, with the DCA strategy, you purchase small amounts at regular intervals, regardless of market stability. Should you utilize the DCA Strategy? DCA facilitates maximizing profits with relatively low risk. Although this approach is not devoid of drawbacks, it offers numerous advantages that can be leveraged to your benefit. Hence, is DCA worth your time and money? As always, we recommend thoroughly studying all available information before making any decisions. Save this article to your browser bookmarks for easy reference in the future. Happy trading!

Education

Dealing with trading losses... before they occur Losses are part of this business. People do not react well to losses. Badly handled losses in trading can trigger bigger losses. Furthermore, these have the dangerous potential of wiping out entire accounts. If you want to make it as a trader you need to have a solid psychological approach to accept and handle losses. Lots of internet articles are suggesting that the way to prevent debilitating losses in trading is to follow risk management rules. What are those rules about? Basically, they are simple thresholds indicating the maximum $ /percentage you should risk per trade, day, month etc. Having such rules is a must but it’s not enough. You can still lose much if your mind is not actually prepared to implement them. That’s why many traders set rules only to break them in the most inappropriate moments. People do not follow their own risk management rules because they are not psychologically prepared to accept losses. They are not prepared for the pain caused by a loss or a series of losses. The single most efficient way to handle losses is to accept them consciously and unconsciously. One of the most dangerous ways to react to losses is “revenge” or “on tilt” trading. This happens when the pain caused by a loss is so high that the trader looses his / her rationality and only wants his / her money back, disregarding most of the things he / she actually knows about the market. The brain cannot accept the emotional discomfort and the fastest solution is to quickly find a trade to make the money back. Most of the time, the quickest trade is in the same instrument (FX pair, stock, etc) that generated the initial loss, by averaging down/up or flipping. Some of the most experienced traders can work their way out but the vast majority will only make things worse. In order to prevent this kind of psychological slippage you need to prepare your mind to consciously and unconsciously accept losses BEFORE they occur. With the help of a psychotherapist or by yourself you can perform visual exercises where you will imagine yourself being in a losing position and reacting the right way. This would desensitize yourself, if done right. The technique I always use each time I open a position is to do that desensitization process “on the fly”. I watch the market and I see an opportunity. BEFORE opening the position, I imagine myself in the posture of facing that trade ending in a loss. After that, I imagine that trade going the way I want. I might even go back and forth (in my mind) a few times between losing and winning. This way, I prepare my unconscious mind. If I cannot imagine myself easily handling the loss (or the win) I will simply reduce size. Pay attention though, I am not recommending here to imagine yourself constantly losing because this would do more harm than good. This would be a separate topic about the power of visualization exercises.

Education

Swing | Intraday | Scalp: pros and cons of three trading styles As we all know, the three most popular trading styles are the following: Swing trading, Day trading, and Scalping. This educational post is concentrated on highlighting some of the pros and cons of all three techniques. When it comes to Swing Trading (middle to long-term trading), some of the advantages are less screen time, less anxiety, less risk, and less candle noise. This style of trading is beneficial for those individuals that do not have enough time to sit in front of the charts and execute positions on a daily basis. However, some drawbacks should be mentioned as well. In order to be a swing trader, one needs to master the skill of remaining patient, disciplined and cold-blooded. Swing trades can run from one day up to a week, and hence, it is crucial to know how to sit on your hands and do nothing upon witnessing slow price action, indecision, drawdown and so forth. Moving to intraday trading, no overnight and over-the-weekend risks can be associated with this style as executed positions are usually closed within a couple of hours when trading the H1 and lower-timeframe graphs. On the negative side, in order to make a living off day trading, a strong psychological temperament is needed along with a sufficient trading capital. If swing trading requires a minimum of a risk of 1-2% per trade, the number is lower for day trading. Hence, a bigger input (capital) is required in order to be able to make decent returns. Last but not least: Scalping. The fans of this style of trading usually dedicate their focus on timeframes as low as the M5 and M1. Aiming towards capturing 5-10 pip movements, scalpers use smaller lot sizes in comparison to swing and day traders. Nevertheless, this trading style comprises of drawbacks such as indecision and a high degree of emotional state. Since the main purpose of scalping is capturing small price movements identified on lower-timeframe graphics, the noise and confusion is relatively high. While all trading strategies have their own benefits and drawbacks, choosing a trading style that suits your goals and interests the most is highly linked with your personality. If you are a patient and, at the same time, a busy person, swing trading might be the best option for you. On the other hand, if you have enough time and patience to sit in front of the charts and execute trades on a daily and hourly bases, then either day trading or scalping might be the best variants to opt for. Either way, it all narrows down to patience, long-term vision, discipline, persistence, and risk management. Choose one or two securities that you like trading the most, do not get discouraged while experiencing losses and moments of hardship, remain cold blooded and long-run oriented. Investroy

Education

The Simple Plunge Strategy Hello dear @TradingView community! Welcome to @Vestinda, your trusted trading companion in the ever-changing world of financial markets. Our team is passionate about giving traders like you the tools and knowledge to make smart decisions and achieve your investing and trading goals. At Vestinda, we know that successful trading involves using effective strategies, analyzing the market, and managing risk. That's why we sharing a strategy that can help you make the most of downward trends — The Simple Plunge Strategy. This strategy is designed to help you navigate downward movements in the market with confidence. It focuses on spotting specific patterns that occur during sharp drops in cryptocurrency prices. By understanding and applying this strategy carefully, you have the potential to increase your profits. The Simple Plunge Strategy involves looking for certain signs: a strong and sudden downward movement in price, shown by a big candlestick with high trading volume. After the drop, the price often recovers to levels seen when the candlestick opened. By closely watching how the price moves across certain boundaries, you can find good points to enter trades and set your profit targets and stop-loss levels. To use the Simple Plunge Strategy effectively, it's important to find the right entry points and manage your risk. You can find entry points by watching the price as it rises above the starting point of the candlestick with a big volume. To determine your profit target, you can use half of the candlestick range. And to manage risk, you can set a stop-loss order above the previous high point. This strategy can be used with different timeframes, but looking at 15-30 minute intervals can give you opportunities for quick trades. When applying the strategy to cryptocurrencies, look for coins or tokens that have experienced significant drops with high trading volume. Watch how the price moves above and across the starting point of the drop to find potential entry points. You can also find examples of Simple Plunge patterns on CEX platforms, which list various cryptocurrencies. Take a look at coins such as ETH, DOGE, and others to see instances where the price sharply drops and then rises again, indicating possible entry points. Remember, the Simple Plunge Strategy can also be used in reverse to identify opportunities during upward movements. A similar pattern often occurs when prices rise. We'd love to hear your feedback on the Simple Plunge Strategy. Have you tried this approach in your trading? Share your thoughts, questions, and experiences in the comments below. Let's have a lively discussion and support each other in the world of trading.

Education

Unpopular trading advice: fall in LOVE with one pair ONLY In a world where you can love anyone and anything your heart desires, fall in love with ONE currency pair ONLY. The notion of "the more pairs I trade, the more money I will make" is false. If you wanna be a consistently profitable trader, it is more beneficial to focus on a small selection of securities and master them, and there is a concrete reason for that. Concentrating on one or two currency pairs instead of trading every single major, minor, and exotic pair will be more efficient, less confusing, and more profitable. When you study every single movement of any given pair, you get more experienced at trading it and you make more rational decisions and analyses. Looking at the chart illustration, we might observe the trading log of all transactions we executed in April and May so far. With 8 trade entries and all of them being EUR/GBP, a total return of +9.6% has been generated constituting an approximate win rate percentage of 70%. Obviously, not every trade resulted in being profitable as we encountered 2 losses and a breakeven closure. Nevertheless, as we always indicate, trading is a game of big numbers and probabilities. Instead of trading 10 securities, we have only been focusing on one single currency pair recently. One crucial thing that needs to be noted is the following: not always will the one specific currency pair of your choice provide you with clear swing opportunities as the example of EUR/GBP portrayed on the graph. Periods of long and dull consolidations, indecisions, and some other moments will take place and make a derivative unlikeable and less efficient to trade for a period of time. Therefore, always have one or two other trades on the radar to eventually monitor and analyse along with the currency pair of your preference. Love will save the world. Investroy.

Education

Trader ⚔️VS⚔️ Analyst !!!(Differences)Hi, everyone👋. Do you like surfing or guiding surfers? In this article, I will talk about how analysis differs from trading. A good analyst is not necessarily a good trader📉. Do you know what the point is❗️❓ The point is that analysts talk about all aspects, so they always tell the truth and explain what really happens on the market, but the traders ride the waves. Financial markets include high and low waves, so if a trader makes a mistake in measuring its depth, speed, and height may drown in the sea. If you are a trader, don’t be proud of yourself because the financial market sea is very cruel or a beast. —------------------------------------------------------------------------------------------------------------------ There are four trading keys in financial markets: Trading Strategy Capital Management Market Psychology Trader Psychology These keys are like four legs of a chair🪑 which should be sat on carefully and calmly. Although by removing one of the legs, it’s possible to sit on the chair, safety has to be considered. I’ll explain all the trading keys in the market in other posts later, but for now, let me dig into the differences between Analysis📈 and Trading💰 . What is considered in the analysis are the price targets in both rising🟢 and falling🔴 markets, the probability of its occurrence and non-occurrence, and the necessary conditions for both. Considering the subtlety of an analyst's words and the mentality of the people studying - who are mainly looking for confirmation of their position - generally, the analyst will always be right unless he has declared only one direction decisively, which is not an analysis, but a signal and prediction. Declaring an upward↗️ or downward↘️ trend in only one direction is not an analysis but a prediction. It’s noted that any prediction can be wrong. But in the comprehensive analysis of both sides, the necessary conditions for their occurrence and their probability are stated, so whatever happens, the analyst is right, and you will hear the famous saying "as predicted." 🔷 A successful trader can take the following steps: Comprehensive analysis of the market situation in which he wants to trade: The technical analysis must be prepared before opening a trade position. A wrong analysis does not always lead to a wrong trade, and vice versa, a correct analysis does not lead to a correct trade because you have to see whether the position trigger is activated or not. Find useful trading strategies to achieve profitable trading: A trading strategy can be a system that includes a combination of different indicators and oscillators, which can finally indicate the entry and exit points as well as profit and stop loss while trading. This system makes you behave like a robot; after understanding and analyzing the market, you’ll wait for the entry and exit points to appear. Trusting this trading strategy is one of the critical keys to successful trading. All the points mentioned so far are related to the technical analysis aspects; otherwise, in the Fundamental field, a daily checklist of various factors affecting the market is needed, which is vital for Fundamental analysis. Find your own timeframe: Chart analysis and trading can be viewed from the 1-second time frame(short-term) to several years(long-term), but every trader should have his own time frame based on his trading strategy. The time frame is important because: The trading strategy should help traders find the entry and exit signals in the same time frame. The Stop Loss(SL) should be determined based on entry points in the same time frame. The time required to reach profitability is estimated based on the same time frame. You can't analyze on a daily time frame and expect to get a very good profit immediately after entering the position. After determining the time frame and with the help of the trading strategy, the following tasks should be done. Studying market analysis to identify market trends, the state of market movement waves, and daily, weekly, and monthly support and resistance zones. Determining the Entry Points(EP) based on the strategy Determining the Stop Loss(SL) based on the strategy Determining the Take Profits(TP) based on the strategy All the above must be done before entering the market, and the only thing done after entering the market is the last step—changing the exit point based on the variable stop loss to increase profit. —------------------------------------------------------------------------------------------------------------------ 🔷 Conclusion: According to the explanations given, it can be understood that analysis and trading have a significant differences. It should be noted that every wrong analysis published on social networks does not indicate that the analyst does not trade well and vice versa. So, to profit from the financial markets, you must be trained in the first step. Become an analyst and then trade. For this, you have to go step by step, don't be greedy, don't rush, so that you can stay in the financial markets and earn profit every day until you get a continuous profit one day.

Education

Updated

EURUSD: Part 1 funny story!I. Not proficient unconsciously. When you enter the market and start trading, you may think that it's a great way to make money because you hear a lot about it and know of people who have made a lot of money from Forex. However, it's important to note that this is just the first stage and, like when you first learn to drive, it may seem easy at first but can be challenging as you continue to learn. Prices in the market can fluctuate wildly, adding to the complexity of Forex trading. When you're new to trading, it can be overwhelming and confusing. You may find yourself unsure of what to do when you see the prices fluctuate in the market. Without proper knowledge, you may take risks that could potentially harm your trades. You may even fall into a cycle of increasing your trading volume when you feel confident, only to end up losing capital in the long run. This is a common stage for beginners that typically lasts a few months to a year before moving on to the next phase. Continue ... I will release the next part tomorrow, stay tuned.

Education

by Sphyn-Trader

6 simplest and most effective forex trading methods!Popular forex trading methods Typically, strategies for forex trading are primarily founded on fundamental and technical analysis. Hence, astute traders possess the skill to creatively merge efficient trading techniques to identify the most appealing gains. 1. Day trading Day trading is a trading strategy where traders, known as day traders, do not hold any trades overnight and close all orders before the end of the trading session. Day traders commonly use technical analysis to assess and capitalize on price changes by observing time frames or trading volumes throughout the day. Typically, day traders keep trades open for a few minutes to a few hours. - Advantage: By effectively managing risks, traders can secure monthly profits without having to worry about prices moving unfavorably due to news or paying overnight fees. Additionally, closing positions at the end of each session can help avoid potential risks. - Defect: Monitoring the market throughout the day can be both stressful and time-consuming for traders. Failure to do so could result in significant losses if the market experiences a decline or deviates from predicted movements. 2. Scalping Scalping, a technique utilized by investors known as Scalpers, involves short-term trading wherein orders are held for just a few seconds or minutes at most. This approach entails buying and selling multiple times a day to capitalize on minor price movements within short time frames in order to gain small spreads. Scalpers execute numerous orders during trading sessions due to the brief trading period. With adept use of financial leverage, a trader can typically earn 5-10 pips per trade on average. However, choosing a broker with low spreads and commissions is crucial for maximizing the benefits of the scalping approach and minimizing trading costs. - Advantage: There are always plenty of profitable trading opportunities every day. Overall income is quite high. - Defect: Always have to watch forex charts for hours. The mind is always tense and pressured. 3. Swing trading Swing trading is a strategy used by traders to take advantage of oscillations in the market. It involves holding positions for a few days to weeks, typically averaging two to four days. This approach relies heavily on technical analysis, including candlestick patterns, support and resistance levels, and indicator lines, to identify suitable entry and exit points. Since it is a medium-term strategy, traders usually analyze forex charts on 1H (1 hour) and 4H (4 hours) time frames. - Advantage: You don't have to constantly monitor the market like scalpers and day traders, which frees up time for other important tasks. This allows for a more relaxed mental state and less pressure. The rate of return is still quite appealing. - Defect: Take the risk for holding orders overnight. It is not possible to get a large profit when the market has strong fluctuations in a bad trend. 4. Position trading Position trading is a trading strategy that involves holding orders for a prolonged period, ranging from several weeks to even years. Consequently, forex charts of position traders are viewed over days or weeks. Unlike scalpers, position traders rely more on fundamental analysis rather than technical analysis to make informed decisions regarding future price trends and determine whether to buy or sell currency. - Advantage: No need to spend a lot of time "watching" the market. The sentiment is relaxed and not under great pressure because position traders are not affected by short-term price movements. Profit margins can be huge if the market moves according to your expectations. - Defect: Requires traders to have a solid background in fundamental analysis and technical analysis, especially when it comes to regularly monitoring economic and political news in the world. The capital requirement is quite large as the stop loss is usually deeper. Profit is calculated on an annual basis because the number of trades is very small. 5. Price action Price action trading is a technique that involves analyzing previous price movements to make technical trades. This strategy can be used alone or in conjunction with other technical tools. Fundamental analysis is seldom used by price action traders, who instead rely on resistance/support levels, Fibonacci retracement, price patterns, and indicators to determine entry and exit points. Price action trading is applicable to short, medium, and long-term timeframes, and investors are advised to analyze prices across multiple timeframes for a more comprehensive and precise overview. - Advantage: Trading is relatively simple because mainly just using candlestick charts. Therefore, the price action method is very suitable for new traders. Cultivate analytical thinking ability. - Defect: For intensive use is very difficult. It is highly subjective, depending on the assessment and experience of each trader. There are many risks such as strong price fluctuations or the market being manipulated by the makers. 6. High-Frequency Trading Price action trading is a technique that involves analyzing past price movements to make technical trades. This strategy can be used alone or in conjunction with other technical tools. Unlike fundamental analysis, price action traders rely on resistance/support levels, Fibonacci retracement, price patterns, and indicators to determine entry and exit points. This approach is suitable for various timeframes, and investors are advised to consider multiple timeframes for more precise analysis. - Advantage: Contributing to stabilizing the market to avoid strong price fluctuations. From there, helping traders limit big losses. Make full use of the price difference and make a profit. - Defect: Trade with fast speed and large volume, so it is easy to have a strong impact on the market. No broker involvement due to complex algorithms applied. Easy to cause virtual transactions. How to choose the right trading method for you 1. Determine the purpose of forex investment. 2. Determine the transaction time. 3. Consider some other factors. Conclude: The article mentioned six successful forex trading methods along with their benefits and drawbacks. This comprehensive guide will assist you in selecting an investment plan that aligns with your objectives and vision. By skillfully combining these trading methods, you can increase your chances of successful transactions. Good luck in achieving your investment goals!

Education

by Sphyn-Trader

6 Short term Forex trading tips.To succeed in short-term forex trading strategies such as scalping and intraday, there are six key secrets that must be understood and implemented. These secrets are essential to success and have been proven effective. 1. Trading capital Many traders aim to grow their small account from 10$ to $100 by frequently trading small orders, and some may even turn it into $100,000. However, it is not a guaranteed outcome for everyone. Short term trades require sufficient capital as they involve frequent opening and closing of positions. Failure to understand concepts such as Lot determination, pip valuation, and capital management may result in significant losses. Having low capital increases the risk of losing the account quickly, especially if the trader has poor control over their gains and losses. 2. Determine leverage It's important to keep in mind that leverage has both positive and negative effects in Forex trading. Traders often suffer losses not because of their trading abilities, but rather due to two primary reasons: Do not know how to use leverage, or abuse leverage Lack of funds When you use full leverage to trade, you are putting your account at the highest risk. 3. Transaction costs All businesses have to bear transaction costs, and in the case of the Forex market, these costs are in the form of Spread, Comission, and Tax. The frequency of transactions directly impacts the escalation of costs, which can be pretty significant, especially for accounts that incur high Comission charges. However, if you avoid Comission, you may have to bear high Spread costs instead. If you are interested in scalping or intraday trading, it is advisable to select a broker that offers low commission and narrow spread. But make sure that you are using an ECN account, as it will only require you to pay the commission fee. Moreover, it is suggested that you enroll in an IB account to receive additional commission rebates. It is crucial to consider these factors while choosing a broker for scalping and intraday trading. 4. Fluctuations of market trends For traders who engage in Intraday and Scalping, it is crucial to select the appropriate position for trading. The initial step involves assessing the overall market trend, followed by recognizing significant price levels. You should then analyze the underlying factors that influence short-term fluctuations within those price levels. Lastly, you must opt for a Forex trading timeframe that aligns with your trading approach. 5. Scalping and Intraday Trading Strategy To effectively track and analyze the shorter time periods M1 and M5, it is important to identify the four factors and key rate areas that can lead to errors. After doing so, it is recommended to backtest and determine if any of the trading frameworks are suitable. An effective intraday and scalping strategy is to utilize the breakout trading strategy, specifically targeting psychological zones such as support and resistance zones. 6. Trading Psychology When it comes to short-term trading, traders face greater psychological pressure and must exercise more patience in order to achieve maximum profit while minimizing risk. Compared to long-term traders, those who engage in short-term trading experience more pressure. Additionally, it is important for traders to maintain a high level of trading discipline by entering trades quickly, placing accurate and timely orders, and avoiding greed. These factors are essential for success in short-term trading. Greetings to all traders! I have some valuable trading-related information that I would like to share with you ❤️

Education

by Sphyn-Trader

Updated

The Process of Creating Strategy Hello traders, In this post i am going to show that how we can create and develop the trading strategy that works. Now the first step we need to do is just search and find the any trading method that suitable for us for example that would be like elliott wave, ict concept, VSA, just using indicators and maybe you can also create your own method and backtest it. when you learned the method now its time to create your trading rules every strategy has own different rules like what is your risk to reward ratio? what is your trade management plan? either you manage your trade or just take the trade and come back after its hit TP or SL, how much is your daily limit means how much trades you will be taking in a day or in a week if you want to become a swing trader depends on you, what is your risk per trade? can you will be cutting the risk to half or just use fixed risk after lose trade? what is your daily limit of losing? can you hold trade overnight or over weekend? what is your trading timeframe? what is your trading sessions? etc... These all kind of rules you will be require to create for yourself they might be different rules depends on your strategy method now we learned the method and created the rule move forward to the next step is open the live demo trading account and trade with your strategy and apply the rules don't break the rules that you created trade at least 30 days and journal your data your taking trades after 30 days check the journal you will see your data for example in your rules you set 1/2 risk reward ratio so you need to have around 40% winning ratio check the journal check the results did you have a 40% winning ratio if the answer is yes then good to go i am sure that you know what to do next but if you failed and your winning ratio is below 40% now analyze your journal data the trades you taken you will see some of bad trades that you don't wanted to trade again just avoid those trades next time and try again the process for the next 30 days. repeat the process one day you will be profitable and consistent but if you not then try again again learn from your mistakes and don't do that mistakes again. When yo have been profitable this is the time you wanna enter in the market open the real live trading account and start trading with your strategy and follow the rules that you created for yourself run the process and always remember trading is not quick rish scheme you need to have a lot of patience, trading is a long run game like marathon race and its required patience. some of my advice is don't try to break the rules, don't depend on one trade, some times market will give you some results that you don't want from it but be patient and be consistent with your strategy with your rules, you will be facing drawdowns but that is the learning process you will learn a lot from the drawdown so with the time you will be better consistent and be profitable just don't leave the process too soon and believe in yourself and try again again and again, trading is a very beautiful and also the easiest thing to live life but firstly in the starting it required from us to pass the test. trading is a very easiest thing but also a very hardest thing. i hope you find this post useful, i wish you good luck and good trading. If you like the post, boost my work with like comments and share thanks!

Education

The Two Types of Risk Management Plan Hello traders, 1) Fixed Risk Calculates position size for next trade as a percentage of account depend on how much risk you willing to take every time every trade you taking you need to use fixed risk for every trade like for example 1% risk per trade so in this type of risk management plan we should require 100 losing trades in a row to blowing out our account a lot of people just using this simple method and this is very easy and understandable. 2) Cutting the Risk : In this method cutting the risk we just normally trade 1% risk per trade but if we lose that trade so we just cut the risk to half for example if i trade with 1% risk and i lose so now the next second trade which i am taking i will be using 0.5% risk in that trade if i lose then i will be just keep using the same risk 0.5% some traders are are keep reducing the risk size like they come all the way to to 0.25% maybe they work for it but in our scenario if we keep losing we will be not reducing more than 0.5% risk per trade and when win comes then after our winning trade we will be back to the normal risk which is 1% risk per trade and keep trading with 1% risk per trade so short summary is if we lose cut the risk to half if we when if we win back to the normal risk if we win again stay with same normal risk but if lose then reduce the risk to half. The reason behind that is in the fixed risk you have 100 traders to blowing out your account means 100 chances but in cutting the risk now we just calculate if we lose 100 trades in a row like fixed risk we would not blow out our account,, let's say we take our first trade and we lose now we are in -1% then another trade we will be taking with 0.5% per trade risk so here is 0.5% × 100 trades = 50 means if we continue to lose in a row after 100 trades we will be facing -50 draw down, so cutting the risk to half after lose trade is the safest method who wants to play safe and more chances to survive in the market. I wish you good luck and good trading. If you like the post, support my work with like comments and share thanks!

Education

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