Mastering the Anchored Volume Profile: Setup & Tutorial on TVMastering the Anchored Volume Profile: Setup & Tutorial on TradingView 📊
The Anchored Volume Profile is a powerful tool that traders use to visualize volume distribution over a specified price range, providing critical insights into market behavior. Here’s a detailed description of its setup and usage on TradingView:
In this video, we will be going in-depth into the following areas:
What is the Anchored Volume Profile?
The Anchored Volume Profile is a specialized indicator that helps traders understand the distribution of traded volume at different price levels. Unlike traditional volume profiles that analyze data over a fixed time period, the anchored version allows traders to anchor the volume analysis to specific bars, candles, or price points.
Why Use the Anchored Volume Profile?
Identifying Support and Resistance Levels: You can easily identify key support and resistance levels by analyzing where the most volume has been traded.
Spotting Trends and Reversals: High-volume nodes can indicate areas of strong interest, helping to predict potential trend continuations or reversals.
Improving Entry and Exit Points: Knowing where the market participants are most active can significantly enhance your decision-making process for entries and exits.
How to set up the Anchored Volume Profile on TradingView:
Add the Anchored Volume Profile Indicator:
Click on the “Indicators” button at the top of the chart.
Search for “Anchored Volume Profile” in the search bar.
Select it from the list and apply it to your chart.
Anchor the Indicator:
Click on the anchor icon that appears on the chart.
Drag it to the specific bar, candle, or price point where you want to start your volume analysis.
Customize Settings:
Adjust the settings to suit your trading style. You can modify the range, color, and other parameters to better visualize the data.
Using the Anchored Volume Profile:
Analyzing Volume Nodes: Identify high and low volume nodes. High volume nodes often act as support or resistance, while low volume nodes might indicate potential breakout areas.
Understanding Market Sentiment: See where the majority of trading activity has taken place to gauge market sentiment.
Making Informed Decisions: Use the insights from the volume profile to make better-informed trading decisions regarding entries, exits, and stop-loss levels.
Tutorialtrading
This is all you need to get started: a paper trading account!Starting your trading journey wisely means utilizing a Paper Trading account, also known as a demo account. This account simulates the real trading experience by mirroring market movements and conditions, but operates without the risk of losing real money. It offers traders access to comprehensive market data just like a live account, enabling practice with real-world price fluctuations—if Gold (XAU/USD) experiences a 5% rise or fall, the same scenario reflects in the demo account. This provides an excellent opportunity to understand market dynamics without financial exposure.
A Beginner's Best Friend: The Demo Account
For novice traders, a demo account is an essential entry point into the financial markets. It allows individuals to familiarize themselves with various trading aspects and strategies. Many traders base their transition to live trading on the insights and performance gleaned from their demo accounts. The convenience of setting one up is straightforward—simply use the Paper Trading option on TradingView to practice with a simulated account.
Click on the Trading Panel of your chart, and you'll find the Paper Trading option on TradingView.
Advanced Applications for Experienced Traders
However, the utility of demo accounts isn’t confined to just beginners; seasoned traders also derive significant benefits.
Experimenting with New Strategies
Experienced traders frequently utilize demo accounts to try out and assess new trading strategies. This method serves as a safe way to test different approaches without putting their capital at risk.
Evaluating Automated Tools
Developers of trading bots and algorithms rely on demo accounts for comprehensive testing of their tools. These automated systems undergo rigorous backtesting in a zero-risk environment, ensuring they are ready for live trading scenarios.
Training and Development
Demo accounts serve as effective training platforms for both individual traders and those employed within financial institutions. Whether it’s a retail trader or a professional in a hedge fund, these accounts offer vital learning experiences that hone skills effectively.
Skill Development and Confidence Building
The benefits of demo accounts extend to enhancing both technical and soft skills. Fundamental competencies such as market analysis, strategy formation, and data interpretation can be improved in a low-stakes setting. Meanwhile, soft skills like patience, resilience, and adaptability receive a boost, ultimately shaping a well-rounded trader.
Moreover, the journey can build confidence. Since trading can be intricate and losing money can shake one's self-assurance, a demo account provides a haven for refining trading strategies without risking actual funds. This psychological support can significantly influence success in the live markets, where self-confidence is often linked to profitability.
How Long Should You Practice?
The duration one should spend in a demo account varies, influenced by personal factors. For those transitioning to full-time trading, a minimum of three months is advisable. Though this may seem lengthy, it is a small price to pay for a comprehensive understanding of market dynamics and a variety of trading conditions.
The Advantages of Practicing Day Trading in a Demo Account
1- Accelerated Learning
Utilizing non-market hours for practice enables traders to quickly accumulate experience, far exceeding what can be gained during regular market sessions.
2- Preparedness for Quick Decisions
Day trading requires rapid decision-making skills. Regular practice in a demo account equips traders to respond swiftly to market fluctuations.
3- Intuitive Market Recognition
Frequent practice encourages an instinctual grasp of market conditions, vital for timely and effective trading actions.
4- Confidence in Trading Decisions
Confidence plays a critical role in a day trader's success. Thorough practice in a risk-free environment allows traders to build confidence before they step into live trading.
5- Adaptability to Market Variability
Day traders often experience victories and losses. Practicing within a controlled environment fosters a clear mindset to tackle each trade, essential for adapting to shifting market scenarios.
6- Setting Realistic Income Expectations
Repeated practice enables traders to set achievable income expectations, cultivating a sensible outlook prior to committing to full-time trading.
7- Enhancing Chart Analysis Skills
A demo account encourages traders to develop chart reading abilities without becoming overly reliant on them, promoting a balanced analytical approach.
8- Personal Trading Style Development
The complexities of day trading call for personalized strategies. Regular practice in a demo account allows traders to foster their unique trading styles and embrace accountability for their decisions.
9- Effective Risk Management
Practicing with margin in a demo account allows traders to experiment with leverage while treating each trade seriously.
Also Read:
and now...
"Best Practices for Using Demo Accounts"
To ensure you maximize the benefits of a demo account, adopt the following strategies:
Serious Approach
Although no real money is at stake, treating the demo account with seriousness enhances realism and deepens the learning experience.
Realistic Capital Allocation
Even though demo accounts may offer unlimited capital, traders should simulate an amount similar to their intended live trading capital for a more accurate experience.
Maintain Consistent Leverage
Using the same leverage plan that you would apply during live trading ensures that your demo experience aligns closely with potential future outcomes.
Gradual Transition to Live Trading
Transitioning from a demo account to live trading should be done thoughtfully. Test your strategies extensively in the demo environment, simulating real trading amounts, to reduce the likelihood of mistakes once you start live trading.
In conclusion...
In summary, a demo account is a vital resource for both novice and experienced traders navigating the complexities of financial markets. For beginners, it provides a risk-free avenue to grasp market dynamics and develop essential trading techniques. For seasoned professionals, demo accounts are indispensable for strategy testing, evaluating automated tools, and enhancing both technical and psychological skills.
While the ideal duration in a demo account varies from trader to trader, committing to three months is recommended for anyone serious about entering full-time trading. Day traders particularly stand to gain by practicing within a demo setting, allowing them to accelerate skill acquisition, prepare for snap decisions, and foster a robust sense of confidence. The structured environment of a demo account promotes the crafting of personalized trading strategies, the establishment of effective risk management practices, and the ability to adapt to real-world market conditions.
Lastly I would like to add this previous lecture to this post, I'm sure will be useful for you...
The Psychology Of Trading How To Manage Your Emotions
and..
The Benefits of Keeping a Trading Journal for Your Psychology
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Mastering the Risk/Reward Ratio: A Key to Trading ProfitabilityMastering the Risk/Reward Ratio: A Key to Trading Profitability
In the world of trading, achieving success isn't merely about selecting the right stocks or making spot-on predictions. True profitability lies in managing risk effectively, a skill that can be the difference between sustained growth and heavy losses. A primary tool for this is the risk/reward ratio—a fundamental element in a trader’s toolkit. This metric helps traders maintain discipline and clarity, ensuring each trade has a strong potential for profit while keeping possible losses in check.
Whether you’re new to trading or have years of experience, understanding and using the risk/reward ratio can transform your approach. It’s not about maximizing the number of wins but ensuring that the rewards consistently outweigh the risks. Here, we’ll explore how this ratio impacts trading strategy and why it’s critical for long-term success.
Understanding the Risk/Reward Ratio
The risk/reward ratio is a straightforward formula that compares the profit potential of a trade to its possible loss. Essentially, it answers the question: How much can I gain for every dollar I risk?
For example, if you're willing to risk $100 for a possible $300 gain, your risk/reward ratio is 1:3, meaning you could make $3 for every $1 at risk.
Example of a 1:3 risk-reward ratio in EUR/USD
This concept encourages traders to evaluate the potential downside of a trade before jumping in, moving away from focusing solely on potential gains. By keeping a balanced view of risk and reward, traders can avoid seemingly attractive trades that may carry excessive risk, enabling them to approach the market with a disciplined, long-term mindset.
Why Risk/Reward Matters
Every trade involves risk, and the ability to manage it effectively often differentiates successful traders from those who struggle. Using the risk/reward ratio ensures that each trade is structured with a clear plan, protecting capital while allowing for potential profits. Without this focus on risk, traders may chase high returns without properly assessing the downside, leading to costly mistakes.
Combined with tools like stop-loss orders and position sizing, the risk/reward ratio becomes part of a broader risk management strategy. These components work together to balance profit potential with loss control, which is essential for traders aiming to sustain profitability over time.
Here you can find a comprehensive article on stop-loss strategies.
Risk/Reward Ratio vs. Win Rate
A common misconception among novice traders is that trading success depends on winning more trades than losing ones. Experienced traders know that profitability has more to do with how risk is managed in losses than how many wins you achieve. The risk/reward ratio addresses this, making it possible to be profitable even if a trader wins less than half of their trades, as long as the wins are substantial enough to offset the losses.
For example, if a trader wins only 40% of the time but maintains a 1:3 risk/reward ratio, the profits from winning trades can cover losses from losing trades while still yielding an overall profit.
Here is a comprehensive table comparing risk/reward ratios to win rate profitability.
Advantages of a Disciplined Risk/Reward Approach
One of the most valuable benefits of using the risk/reward ratio is the structure it brings to trading. It helps traders stay rational and minimizes emotionally driven decisions, such as holding onto losing positions with the hope of a reversal. By maintaining a favorable risk/reward ratio, traders enter each trade with a defined plan, reducing the chance of impulsive, loss-heavy decisions.
Furthermore, applying a risk/reward framework ensures that trades are entered only when the reward justifies the risk. Over time, this disciplined approach fosters consistency and sets the stage for more predictable results.
Steps to Calculate Risk/Reward Ratio
Calculating the risk/reward ratio is a simple yet impactful process that enhances trade planning. Here’s a step-by-step guide:
1- Determine Your Risk: Define the amount you’re willing to lose if the trade moves against you, which is the difference between your entry price and stop-loss level.
2- Define Your Reward: Establish the potential profit if the trade goes in your favor, measured from the entry price to your target profit level.
3- Calculate the Ratio: Divide the potential reward by the potential risk to get your risk/reward ratio.
For instance, if you’re buying a stock at $100 with a stop-loss at $95, your risk is $5. If you aim to sell at $115, your reward is $15, giving you a 1:3 risk/reward ratio.
Choosing an Ideal Risk/Reward Ratio
The ideal risk/reward ratio can vary based on trading style and goals, though many traders aim for a minimum of 1:2 or 1:3. Higher ratios like 1:3 allow for a more forgiving approach to losses, where a trader doesn’t need a high win rate to be profitable. However, shorter-term traders might use lower ratios (e.g., 1:1.5) while aiming for a higher win rate to balance profitability.
Ultimately, the best ratio depends on factors like trading frequency, volatility, and risk tolerance. Day traders may prefer a 1:2 ratio, allowing for quicker exits with decent returns. Swing traders, on the other hand, might look for a 1:3 ratio or higher to justify holding positions longer despite potential market fluctuations.
Managing Risk with the Right Tools
Achieving long-term profitability requires more than just a favorable risk/reward ratio; it also demands effective risk management. Stop-loss orders, for instance, are invaluable for capping potential losses. Placing stops at logical price points, such as below support levels or above resistance levels, helps protect positions without risking premature exits.
Similarly, maintaining discipline by skipping trades that don’t meet your risk/reward criteria can prevent excessive losses. Proper position sizing and a detailed trading plan round out this approach, ensuring that each trade aligns with your overall strategy and risk tolerance.
Here is a comprehensive guide about the Risk Management
Final Thoughts: The Power of the Risk/Reward Ratio in Trading
The risk/reward ratio is more than a calculation—it’s a mindset that can lead to stronger, more disciplined trading decisions. By assessing potential risks and rewards before each trade, you can avoid impulsive choices and safeguard your capital. This approach brings clarity and control to trading, even amid market unpredictability.
While the risk/reward ratio may be a straightforward tool, its impact is profound. Focusing on balancing risk with reward enables traders to protect themselves from major losses while pursuing worthwhile gains. The next time you plan a trade, remember to ask: “Does this meet my risk/reward criteria?” If not, stepping back could be the wisest move.
Risk management is essential for lasting success, and the risk/reward ratio serves as a constant guide. Consistently applying this ratio fosters discipline, confidence, and, ultimately, greater profitability in your trading journey.
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Don’t Follow Nobody, Neither Me.Have you ever found yourself making investment decisions based on what everyone else is doing? It’s a common scenario—investors rush into the latest hot stock or abandon a sector because it’s suddenly out of favor. The urge to follow the crowd can be overwhelming, but is it really the best strategy for your portfolio?
In the world of investing, trend-chasing—where investors follow market trends without careful consideration—can often feel like a safe bet. After all, if everyone else is doing it, it must be right, right? This behavior, known as herd mentality, is deeply rooted in human psychology. However, in the financial markets, blindly following trends can be dangerous. Trend-chasing can lead to poor investment decisions and, ultimately, harm your portfolio. In this article, we’ll explore the risks of trend-chasing and why it’s crucial to develop a solid investment strategy that resists the pull of the crowd.
What Is Trend-Chasing?
Trend-chasing is the practice of making investment decisions based on the prevailing direction of the market rather than through careful analysis or a well-thought-out, long-term strategy. Investors engaging in trend-chasing often find themselves buying assets that have recently surged in value, hoping to capitalize on the upward momentum, or selling assets that are declining, fearing further losses. The key characteristic of trend-chasing is its reactive nature—investors make decisions based on what’s happening now, rather than a clear understanding of what the future may hold.
A Cautionary Tale: The Dot-Com Bubble
A classic example of trend-chasing occurred during the dot-com bubble of the late 1990s. As tech stocks began to soar, countless investors jumped on the bandwagon, pouring money into companies with little to no earnings simply because their stock prices were rising. The euphoria was contagious—no one wanted to miss out on the next big thing. However, when the bubble inevitably burst, those who had chased the trend found themselves with substantial losses as overvalued stocks plummeted back to reality.
The Meme Stock Phenomenon
More recently, the meme stock phenomenon of 2021 showcased another instance of trend-chasing on a massive scale. Stocks like GameStop and AMC experienced wild price surges driven not by fundamental value but by social media-fueled hype. Retail investors, motivated by online forums and the fear of missing out (FOMO), rushed to buy these stocks, driving their prices to unsustainable levels. While a few early adopters profited handsomely, many others who followed the trend ended up holding overpriced shares when the hype died down, resulting in significant losses.
GME Game-Stop 2021
AMC Entertainment 2021
In both cases, the underlying force at play was herd mentality—a psychological phenomenon where individuals mimic the actions of a larger group, often at the expense of their own rational judgment. This herd behavior drives market bubbles, where prices inflate beyond reasonable levels, and eventually, painful corrections occur. By understanding the dangers of trend-chasing and recognizing the role of herd mentality, investors can better guard against making impulsive decisions that may jeopardize their financial well-being.
The Psychology Behind Herd Mentality
Herd mentality is deeply ingrained in human behavior and significantly impacts how investors make decisions. One of the primary psychological drivers behind herd mentality is the fear of missing out. When investors see others profiting from a particular trend or asset, they often feel an intense urge to join in, fearing they’ll miss out on potential gains if they don’t act quickly. This fear can override logical thinking, leading to impulsive decisions based on emotion rather than careful analysis.
Overconfidence is another psychological factor that fuels herd mentality. When a market trend appears to gain momentum, many investors become overly confident in their ability to predict the future. They believe that if the majority is doing something, it must be the right move, and they overestimate their ability to time the market. This overconfidence often blinds investors to the risks associated with their decisions.
The Impact on Investment Decisions
Herd mentality pushes investors to follow the crowd rather than stick to their well-planned strategies. When everyone else seems to be buying a particular stock or entering a specific market, it can be challenging to resist the pull. As a result, investors may abandon their original investment strategy in favor of what appears to be a winning trend. This can lead to inflated asset prices and bubbles as more investors pile in, often without fully understanding the underlying fundamentals.
The problem arises when the trend reverses, leaving those who followed the crowd vulnerable to significant losses. In essence, herd mentality encourages reactive rather than proactive decision-making, often to the detriment of a sound investment strategy. By succumbing to the pressure of the crowd, investors risk making short-sighted choices that could harm their portfolio in the long run.
The Risks of Trend-Chasing
While the allure of following market trends can be strong, the risks associated with trend-chasing often outweigh the potential rewards. Investors who chase trends are frequently driven by emotion rather than rational analysis, leading to impulsive decisions that compromise long-term financial goals. Although trend-chasing may yield short-term gains, it exposes investors to heightened market volatility and the danger of being caught in a market downturn. Understanding these risks is crucial for developing a disciplined investment strategy that prioritizes long-term success over the fleeting appeal of the latest market trend.
Short-Term Gains vs. Long-Term Losses
One of the biggest dangers of trend-chasing is the temptation to prioritize short-term gains over long-term portfolio health. While it might seem profitable to jump on a trending stock or sector, this strategy often overlooks the bigger picture. Trend-chasing can lead to buying high during a market surge, only to sell low when the trend reverses. This pattern of behavior—repeated over time—can erode portfolio value and make it difficult to achieve long-term financial goals.
Market Volatility
Trend-chasing also exposes investors to heightened market risks. Trends are often fueled by speculation and hype rather than sound financial principles. As a result, markets driven by trend-chasing can become extremely volatile. Prices may swing wildly based on news, rumors, or shifts in sentiment, leaving investors who followed the trend vulnerable to sharp downturns. This volatility makes it challenging to predict market movements and increases the likelihood of significant losses.
Case Studies: Cryptocurrency Market
A prime example is the cryptocurrency market. The rapid rise of Bitcoin and other digital assets attracted a wave of trend-chasers eager to capitalize on the perceived opportunity. However, as seen in the dramatic crash of 2018 and subsequent market fluctuations, those who chased the trend often faced steep losses when the speculative bubble deflated.
BTC Bitcoin 2021
SHIBUSD Shiba Inu Token 2021
How to Avoid Trend-Chasing in Your Investment Strategy
In the ever-evolving world of investing, resisting the temptation to follow trends can be challenging. The fear of missing out and the influence of herd mentality can drive even the most seasoned investors to make decisions based on market trends rather than sound financial principles. However, by developing a disciplined approach, diversifying your portfolio, and staying informed without reacting impulsively, you can avoid the pitfalls of trend-chasing and create a more resilient investment strategy.
Developing a Disciplined Approach
The foundation of any successful investment strategy is discipline. This means setting clear financial goals, establishing a plan to achieve them, and sticking to that plan, even when market trends seem enticing. Here are a few tips to help you develop a disciplined approach:
Set Clear Objectives
Before making any investment decisions, defining your financial goals is essential. Are you investing for retirement, saving for a major purchase, or seeking to grow your wealth over time? Your objectives will shape your investment strategy and help you stay focused. When you have a clear understanding of what you're working toward, you're less likely to be swayed by short-term market trends that don't align with your long-term goals.
Create a Well-Defined Investment Plan
Once your objectives are set, develop a detailed investment plan outlining your asset allocation, risk tolerance, and time horizon. This plan should serve as your roadmap, guiding your decisions and helping you stay on course. A well-defined plan can act as a buffer against the emotional impulses that often drive trend-chasing behavior. When the market is booming and everyone seems to be jumping on the latest trend, your plan will remind you of your long-term strategy, preventing you from making hasty decisions.
Stick to Your Plan in Good Times and Bad
Market fluctuations are inevitable, but disciplined investors understand the importance of staying the course. When trends arise, it can be tempting to abandon your plan and chase after quick profits. However, this often leads to buying high and selling low—a recipe for underperformance. By adhering to your plan, you can avoid the emotional rollercoaster of trend-chasing and focus on achieving your long-term objectives.
Regularly Review and Adjust Your Plan
While discipline is crucial, recognizing when adjustments are needed is also important. Markets change, as do your financial goals and personal circumstances. Regularly reviewing your investment plan ensures it remains aligned with your objectives. However, any adjustments should be made thoughtfully and not in response to short-term trends. This approach allows you to stay disciplined while remaining flexible enough to adapt to changing conditions.
Diversification: Mitigating Risks Through a Balanced Portfolio
Diversification is one of the most effective ways to protect your portfolio from the risks associated with trend-chasing. By spreading your investments across a variety of asset classes, industries, and geographic regions, you reduce the impact of any single trend or market event on your overall portfolio. Here's how diversification can help you avoid the pitfalls of trend-chasing:
Reduce Dependence on a Single Asset or Market
Trend-chasing often leads investors to concentrate their investments in a particular asset class or market segment that is currently in vogue. While this can generate short-term gains, it also increases exposure to market volatility. A diversified portfolio, on the other hand, balances risk by spreading investments across different assets, such as stocks, bonds, real estate, and commodities. This diversification can help mitigate losses during market downturns when specific trends may collapse.
Balance Risk and Return
By diversifying, investors can achieve a more balanced risk-return profile. Different assets respond differently to market conditions, and by holding a mix of investments, you can smooth out the effects of market volatility. This approach allows you to pursue potential gains without exposing yourself to the full brunt of a market downturn.
Create a Stable Foundation for Long-Term Growth
A well-diversified portfolio can provide a stable foundation for long-term growth. Rather than chasing trends that may lead to short-lived profits, you can focus on building a portfolio designed for sustained performance over time. This stability will help you weather market fluctuations and remain focused on your long-term financial goals.
Stay Informed, but Don’t React Impulsively
Staying informed about market trends and economic developments is crucial for making sound investment decisions. However, it’s equally important to avoid reacting impulsively to the latest news or trends. Here are some tips for staying informed without falling into the trend-chasing trap:
Conduct Thorough Research
Before making any investment decisions, ensure you conduct thorough research and analysis. Understand the fundamentals of the assets you are considering and assess whether they align with your long-term goals. This research will help you make informed decisions based on facts rather than emotions.
Focus on Fundamentals, Not Headlines
While headlines may capture attention, it’s important to focus on the underlying fundamentals that drive asset values. Trends often gain traction based on hype rather than solid financial principles. By prioritizing fundamental analysis, you can better evaluate whether an investment is sound, regardless of its current popularity.
Maintain a Long-Term Perspective
Finally, keeping a long-term perspective is vital in avoiding trend-chasing. Markets are inherently cyclical, and short-term trends can be misleading. By focusing on your long-term investment strategy and goals, you can avoid getting swept up in the latest market fads.
Conclusion
In a world where market trends can shift rapidly, it’s essential for investors to recognize the risks of trend-chasing. The allure of quick profits can lead to impulsive decisions driven by emotion rather than careful analysis. By developing a disciplined approach, diversifying your portfolio, and staying informed without reacting impulsively, you can avoid the pitfalls of trend-chasing and work toward achieving your long-term financial goals.
Remember, the key to successful investing lies not in following the crowd but in maintaining a clear vision of your financial objectives. So, the next time you feel the urge to follow a market trend, take a step back, assess the situation, and ensure your decisions align with your long-term strategy. Don’t follow nobody, neither me—stay true to your investment principles, and you’ll be better positioned for success in the long run.
Trading Forex Without a Strategy? These Are the ConsequencesForex trading involves buying and selling currencies to profit from fluctuations in their exchange rates. As one of the world’s most liquid and fast-paced markets, it offers vast opportunities but also significant risks. The dynamic nature of forex trading makes it essential for traders to have a well-defined strategy to navigate market complexities effectively.
The importance of having a trading strategy cannot be overstated. It provides a structured plan that outlines how to enter and exit trades, manage risk, and achieve trading goals. Without a clear strategy, traders often find themselves making impulsive or emotional decisions, leading to inconsistent results and increased losses.
In this article, we'll explore the consequences of trading forex without a strategy, highlight the risks associated with this approach, and discuss why a solid strategy is crucial for consistent success.
⭐️ Read the entire article as I'll include tips and strategies to help you get started.
What Is a Forex Trading Strategy?
A forex trading strategy is a structured plan that guides traders in making informed decisions. It defines specific rules and criteria for entering and exiting trades, managing risk, and achieving trading goals. By following a well-defined strategy, traders maintain consistency and discipline, which are essential for long-term success.
An effective strategy typically includes:
1- Entry and Exit Rules: Criteria based on technical indicators, chart patterns, or fundamental factors to determine when to buy or sell.
2- Risk Management: Guidelines for setting Stop Loss orders, position sizing, and risk-reward ratios to protect capital and minimize losses.
3- Goals and Objectives: Specific profit targets and trading frequency to ensure traders have measurable and achievable benchmarks.
Risks of Trading Without a Strategy
Trading forex without a clear strategy can have significant consequences:
⭐️ BONUS 1
Emotional Decision-Making
Without a strategy, traders are more likely to make impulsive decisions driven by emotions rather than rational analysis.
For instance, during a sudden market dip, a trader may panic and sell, only to miss a subsequent rebound that a strategy would have anticipated.
Inconsistent Performance
A lack of structured guidelines results in inconsistent results and unpredictable performance.
Research shows that traders without a strategy often experience higher rates of failure and lower returns compared to those who follow a disciplined approach.
Increased Risk of Losses
Without predefined risk management rules, traders may incur substantial losses if the market moves unfavorably.
The absence of protective measures, such as Stop Loss orders, exposes traders to severe financial setbacks, especially in volatile market conditions.
⭐️ BONUS 2
Consequences of Not Having a Trading Strategy
1- Lack of Direction
Trading without a plan can result in impulsive or arbitrary decisions, leading to confusion and missed opportunities. This disorganized approach makes it difficult to measure progress or achieve goals.
2- Inability to Adapt to Changing Market Conditions
Traders without a strategy may struggle to respond effectively to sudden shifts in trends or volatility. This can lead to missed trades or significant losses due to a lack of preparation for emerging opportunities or risks.
3- Difficulty in Measuring Performance
Without clear benchmarks, traders cannot accurately track or evaluate their performance.
This lack of metrics makes it challenging to refine strategies or identify areas for improvement.
4- Benefits of Having a Well-Defined Trading Strategy
Consistency and Discipline. A solid strategy enforces rules for entry, exit, and risk management, reducing the likelihood of erratic behavior.
Successful traders often attribute their achievements to adhering to well-developed strategies.
5- Improved Risk Management
Strategies include guidelines for setting Stop Loss orders and managing position sizes, minimizing potential losses.
Traders with effective risk management practices tend to experience fewer large losses and achieve better returns.
⭐️ BONUS 3
6- Clear Goals and Objectives
A well-defined strategy outlines specific trading goals, providing a roadmap for success.
Setting measurable objectives helps traders track progress and make informed adjustments to improve performance.
How to Develop an Effective Forex Trading Strategy
1-Assess Your Trading Goals
Define what you want to achieve—whether it's generating income, growing capital, or improving skills. Set clear, realistic objectives that align with your experience and market conditions.
2- Choose a Trading Style
Select a style that suits your personality and time commitment. Options include:
Day Trading: Involves multiple trades within a day, focusing on short-term price movements.
Swing Trading: Involves holding positions for several days to weeks to capitalize on market swings.
Scalping: Seeks small profits from numerous trades, focusing on quick entries and exits.
Position Trading: Focuses on long-term trends, holding positions for weeks, months, or longer.
3-Backtest and Refine Your Strategy
Test your strategy using historical data to evaluate its performance under different market conditions.
Refine the strategy by adjusting parameters based on results, increasing its effectiveness and adaptability.
4-Utilize Tools and Resources
Leverage trading platforms like TradingView, known for their advanced charting tools and indicators.
Use educational resources like webinars, online courses, and forums to enhance your knowledge and skills.
⭐️ BONUS 4
In Conclusion...
A well-defined trading strategy is crucial for success in the forex market. It provides a clear framework for making informed decisions, setting precise entry and exit points, managing risk, and maintaining consistency. Without a strategy, traders risk falling prey to emotional decision-making, inconsistent results, and significant losses.
Implementing a solid strategy ensures that every trade is driven by analysis and predetermined rules, enhancing your ability to navigate market fluctuations with confidence. By setting clear goals, refining your approach, and leveraging available tools, you can build a reliable and profitable trading practice.
Take the first step today: assess your trading goals, choose a suitable style, backtest your strategy, and utilize resources to create a comprehensive trading plan that aligns with your objectives. With the right strategy, you’ll be better equipped to handle the challenges of the forex market and achieve long-term success.
Trump 2.0: What to Expect If Donald Trump Returns to the W.HouseWith Donald Trump once again campaigning for president, his economic policies and views on international trade are resurfacing. Known for his aggressive protectionism, deregulation, and tax cuts, his economic approach has been dubbed the “Trump 2.0” by the media.
But what does the Trump Trade really mean for investors? During his first term, Trump’s policies produced mixed results. While sectors like finance and energy thrived, the federal budget deficit widened, healthcare coverage decreased, and income inequality grew. Now, with the prospect of Trump returning to the White House, we could witness "Trump 2.0." What impacts might this have on the economy, and how should investors prepare?
Key Points
-The Trump Trade emphasizes lower taxes, deregulation, increased tariffs, and reduced immigration to stimulate U.S. growth.
-Trump’s policies benefited sectors like finance and energy but also increased the federal deficit and triggered trade wars.
If re-elected, Trump’s economic agenda could boost the stock market and select industries but also bring risks like higher inflation and global retaliatory tariffs.
Understanding the Trump 2.0
The "Trump 2.0" represents Donald Trump’s economic strategy, which centers on stimulating growth through deregulation, tax cuts, higher tariffs, and reduced immigration. While this approach benefited specific sectors, it also led to rising federal deficits and global trade conflicts.
Highlights of Donald Trump (2016-2020)
1. A Strong Economy Under Trump, the U.S. economy remained robust, with low inflation and consistent job growth until the COVID-19 pandemic struck. However, the economic momentum seen during Trump’s presidency was largely a continuation of the post-Great Recession recovery initiated by the Obama administration.
2. Job Creation and Wage Growth Prior to the pandemic, job creation and wage growth continued their upward trend, with unemployment hitting a 50-year low of 3.5% in 2019. Wages increased steadily in 2018 and 2019.
3. Tax Cuts The Tax Cuts and Jobs Act of 2017, Trump’s most significant policy, represented the largest tax overhaul in 30 years, reducing the corporate tax rate from 35% to 21%. The tax cuts spurred consumer spending and increased private sector investment, but also added significantly to the federal deficit.
4. Booming Stock Market The stock market thrived under Trump’s administration, with the S&P 500 setting new records until 2022. The Dow Jones Industrial Average rose by 57% during his tenure, fueled by high employment, wage growth, and tax incentives.
S&P500 During Trumph Election
5. Widening Federal Deficit Trump’s tax cuts and increased defense spending expanded the federal deficit. In 2018, the annual deficit hit $779 billion, escalating to over $1 trillion by 2020.
6. Trade Tariffs Trump imposed tariffs on steel, aluminum, solar panels, and Chinese imports, triggering a “trade war” with China and other trading partners like Canada, Mexico, and the European Union. While intended to protect U.S. industries, these tariffs led to global retaliations, impacting American consumers and workers negatively.
What to Expect If Trump Returns to Power
If Trump returns to the White House, his economic policies could have significant implications for various sectors:
1. Impact on the Stock Market
Historically, the stock market performs positively during election periods, regardless of the candidate. If Trump wins, expect market gains due to extended tax cuts, increased oil and gas production, and deregulation. While Trump’s policies could boost corporate investment, stock market performance will ultimately depend on broader economic fundamentals.
2. Impact on Bond Yields
Trump's pro-business agenda, combined with increased spending, could drive inflation upwards. If inflation rises, the Federal Reserve may maintain higher interest rates, which could increase bond yields but reduce bond prices. This would likely result in a more muted bond market under a Trump administration.
3. Impact on Dollar Strength
A strong economy under Trump could bolster the U.S. Dollar. External factors, such as economic weakness in Europe and Asia, may further support dollar strength. However, a stronger dollar could hurt U.S. exporters, making their goods more expensive abroad and reducing their competitiveness.
4. Impact on Specific Sectors
-Financial Services: The sector could benefit from deregulation, enabling banks to expand operations and increase profitability.
-Technology: Tech companies may gain from extended corporate tax cuts, leading to higher investments, stock buybacks, and dividends.
-Energy: Trump’s “drill, baby, drill” policy aims to expand domestic oil and gas production, supporting the energy sector and boosting U.S. exports.
-Manufacturing: While a strong dollar could reduce export competitiveness, Trump’s emphasis on domestic production (e.g., the CHIPS and Science Act) could support U.S. manufacturers.
-Infrastructure: Trump's support for infrastructure projects could benefit construction and civil engineering companies, building on the existing Infrastructure Act passed by Biden.
Global Implications of Trump 2.0
-Universal Tariffs: Trump’s proposed universal tariffs could trigger significant global retaliation, leading to reduced trade, disrupted supply chains, and higher global inflation.
-Renewed Trade War with China: Trump has hinted at increasing tariffs on Chinese imports to as high as 60%, which could hinder China’s economic recovery and create broader global economic uncertainty.
Preparing for Trump 2.0
Investors should keep a close eye on sectors likely to benefit from Trump’s policies, such as finance, technology, energy, and infrastructure. At the same time, be prepared for volatility in the bond market and potential retaliatory tariffs impacting global trade dynamics.
Diversifying portfolios, hedging against potential inflation, and maintaining a long-term investment outlook can help manage the uncertainties associated with a potential Trump return to the White House.
Conclusion
Trump 2.0 could have a significant impact on the U.S. economy and global markets. While certain sectors may experience growth under Trump’s policies, the risks of higher inflation, trade conflicts, and federal deficits remain. Investors should approach a potential Trump presidency with cautious optimism, focusing on sectors that align with his agenda while being prepared for increased volatility. By staying informed and adaptable, investors can capitalize on the opportunities and navigate the risks posed by a possible Trump comeback.
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Mastering Range Trading for Higher ProfitsRange trading is a strategy focused on capturing price movements within a defined range, marked by consistent oscillation between two levels—support and resistance. In this approach, support is the level where buyers prevent further declines, while resistance is the level where sellers cap price increases. Range traders aim to profit from buying at support and selling at resistance, capitalizing on predictable price swings.
While range trading is effective during periods of sideways movement, it has its limitations, particularly when the market becomes volatile or when a trend emerges. By integrating range trading with trend-following and breakout strategies, traders can better adapt to changing market conditions. This blended approach allows traders to capture profits in both consolidating and trending markets, maximizing trading opportunities.
Understanding Range Trading
Range trading focuses on identifying a price range where an asset consistently fluctuates between established support and resistance levels. Traders use this predictable pattern to generate profits by entering long positions at support and selling at resistance. Technical indicators, such as oscillators and volume analysis, help confirm entry and exit points within the range. The primary goal is to capitalize on repetitive price movements, with no expectation of a breakout or major trend shift.
Example of Range pattern in S&P500
Key Advantages of Range Trading
-Consistent Trading Opportunities: Ideal for non-trending markets, offering regular chances to profit from predictable price movements.
-Lower Risk: Relies on established support and resistance levels, minimizing the risk of sudden price swings.
-Simplicity: Easy to understand and implement, making it suitable for traders of all levels.
Limitations of Range Trading
-Vulnerability to Breakouts: Prone to significant losses if a breakout occurs and the price moves beyond the defined range.
-Smaller Profit Margins: Focuses on short-term price moves, resulting in lower profits compared to trend-following strategies.
-Market Dependency: Effective only in non-trending conditions; becomes less reliable during strong trends.
Combining Range Trading with Trend-Following
Trend-following strategies focus on riding sustained price movements in one direction. By entering positions in the direction of the trend, traders aim to capture larger gains as the trend progresses. The integration of range trading and trend-following can create a more adaptive trading plan, allowing traders to capitalize on both sideways and trending markets.
Example Range Trading on EUR/USD Following the trend - SMA 50
How to Blend Range Trading and Trend-Following
-Transition Points: During consolidation phases, range trading can be used to capture smaller price movements. When a breakout occurs, traders can shift to trend-following to capture larger price swings.
Indicators for Blending Strategies:
Use the Relative Strength Index (RSI) to identify overbought and oversold conditions within a range.
Practical Implementation:
For example, when a currency pair is range-bound, traders can buy at support and sell at resistance using range trading. If a breakout follows, they can switch to a trend-following strategy by placing trades in the direction of the breakout.
Integrating Breakout Trading with Range Trading
Breakout trading aims to capture significant price movements when the market breaks beyond support or resistance levels. When combined with range trading, it can maximize trading opportunities, especially during high volatility periods.
Breakout example Range Trading EUR/USD
How to Integrate Breakout Trading with Range Trading
Spotting Breakout Setups:
Use range analysis to identify potential breakout points, as repeated tests of support or resistance often signal an impending breakout.
Managing Risk:
Set Stop Loss orders just below/above the breakout level to protect against false breakouts.
Use position sizing to manage risk according to your risk tolerance.
Maximizing Profits:
Use trailing stops to lock in profits as the market continues to move in the breakout direction.
Key Technical Indicators for Blending Strategies
Moving Averages (MA):
Identify trends and confirm breakouts.
-Relative Strength Index (RSI):
Help identify momentum and reversals, suitable for both range trading and trend-following.
Example of RSI Use on Range Trading
Choosing the Right Trading Platform
To effectively blend range trading, trend-following, and breakout strategies, it’s essential to use the right trading platform.
TradingView: Known for its intuitive interface and wide range of indicators, ideal for technical analysis.
Backtesting Tools: Use backtesting features ( from Tradingview ) to evaluate the performance of your integrated strategy against historical data.
In Conclusion combining range trading with trend-following and breakout strategies can significantly enhance your trading performance. This comprehensive approach allows you to capitalize on consolidation phases, trend shifts, and breakout opportunities. By adapting to different market environments, traders can achieve more consistent and profitable results.
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Patience Pays Off: Key Strategies for Long-Term InvestorsInvesting is a fundamental pillar in building wealth and securing financial stability. Among the myriad strategies available, long-term investing stands out as one of the most reliable and rewarding. Unlike short-term trading, which seeks to capitalize on price fluctuations over days or weeks, long-term investing focuses on holding assets for several years, or even decades, to allow for substantial growth. This approach is deeply rooted in the principle of patience, which enables investors to navigate market volatility, leverage compounding returns, and achieve their financial goals.
Patience is more than simply waiting; it requires discipline, confidence, and the ability to withstand short-term market turbulence. For long-term investors, patience plays a key role in benefiting from compounding returns, reducing transaction costs, and minimizing tax liabilities. The patience-driven investor is less prone to impulsive decisions and is better positioned to reach financial success over time.
Understanding Long-Term Investing
Long-term investing involves purchasing and holding assets like stocks, bonds, mutual funds, or real estate for extended periods—typically five years or more. The main objective is to benefit from the growth of the investment over time, whether through capital appreciation, dividends, or interest. Unlike short-term strategies, which aim for quick profits, long-term investing emphasizes steady and sustainable growth.
Key to this approach is the power of compounding. Compounding occurs when earnings from investments are reinvested, generating additional returns. Over time, this snowball effect can lead to exponential growth. Long-term investing also benefits from lower transaction costs, as frequent buying and selling of assets is avoided. Furthermore, long-term capital gains are taxed at lower rates than short-term gains, offering additional financial advantages.
While long-term investing still carries risks, particularly during market downturns, it provides the potential for recovery and continued growth. In contrast, short-term investors may face higher volatility and risk due to frequent trades and quick shifts in market sentiment.
S&P500 from 1980 monthly chart
Advantages of Long-Term Investing
The long-term investing approach comes with several compelling advantages:
Compounding Returns: The most powerful advantage of long-term investing is the compounding effect, where reinvested earnings generate additional returns. The longer the investment period, the more significant the compounding becomes. Even modest returns can lead to considerable wealth over time.
Lower Costs: With fewer trades, long-term investors incur significantly lower transaction fees and commissions. This not only preserves capital but also enhances overall returns.
Tax Efficiency: Long-term capital gains are generally taxed at a lower rate than short-term gains, leading to more favorable after-tax returns. The buy-and-hold strategy reduces the frequency of taxable events.
Reduced Stress: Long-term investing minimizes the need for constant market monitoring, providing peace of mind. Investors don’t need to react to daily market swings, allowing them to remain focused on their long-term financial goals.
Alignment with Financial Goals: Long-term investing is well-suited for achieving major financial milestones, such as funding retirement, education, or home purchases. It provides a structured and systematic approach to accumulating wealth over time.
GC1! GOLD FUTURES From 1980 Monthly Chart
Why Patience is Essential in Long-Term Investing
Patience is the cornerstone of long-term investing, as it helps investors remain focused on their goals despite market fluctuations and emotional pressures. Here are key reasons why patience is critical:
1. Navigating Market Volatility
Financial markets are inherently volatile, with asset prices fluctuating due to economic data, geopolitical events, and shifts in investor sentiment. While short-term investors may react to these movements, long-term investors recognize that volatility is part of the market cycle. Patience allows them to ride out these fluctuations, avoiding impulsive decisions and giving their investments time to recover and grow. By not panicking during downturns, long-term investors can stay committed to their strategy and avoid selling assets at a loss.
2. Compounding Returns
Patience is vital in maximizing the benefits of compounding. Compounding requires time to work its magic, as reinvested earnings generate further returns. The longer an investor remains in the market, the greater the potential for compounding to significantly boost their wealth. Even modest annual returns can accumulate into substantial wealth over decades.
3. Behavioral Finance and Emotional Control
Investing often involves emotional decision-making driven by fear, greed, and market noise. Behavioral finance studies show that emotions like panic during market downturns or overconfidence during rallies can lead to poor investment decisions. Patience helps investors manage these emotions by keeping their focus on long-term goals rather than short-term market movements. Investors who remain patient and disciplined are more likely to make rational decisions that align with their overall strategy.
NDX Nasdaq 100 Index Monthly Chart
Strategies to Cultivate Patience in Investing
Maintaining patience as a long-term investor requires a combination of strategies that foster discipline and reduce emotional reactivity:
1. Set Realistic Expectations
Establishing clear, realistic financial goals helps investors stay grounded. Understanding that markets fluctuate and that significant returns take time can reduce impatience. Setting specific goals, such as saving for retirement over a 20- or 30-year period, provides a long-term perspective and a framework for measuring progress.
2. Regular Monitoring Without Overreacting
While it's important to monitor your portfolio, it’s equally important to avoid overreacting to short-term market moves. Periodic reviews, such as quarterly or annual check-ins, allow investors to assess performance without being influenced by daily volatility. By maintaining a big-picture view, investors can avoid impulsive decisions and stay on track with their goals.
3. Diversification
Diversification spreads risk across various asset classes, sectors, and regions, helping to reduce the impact of poor performance in any single investment. A well-diversified portfolio provides a smoother experience, allowing investors to remain patient even during periods of underperformance in certain areas.
4. Continuous Learning and Education
Staying informed about market trends and investment strategies helps investors feel more confident in their decisions. The more knowledge an investor has about market behavior, historical trends, and the benefits of long-term investing, the more patient they can remain during challenging times. Education empowers investors to understand that short-term volatility is part of the process.
Case Studies and Historical Examples
Several well-known examples illustrate the power of patience in long-term investing:
Warren Buffett: One of the most famous proponents of long-term investing, Warren Buffett has built his wealth through patience and disciplined investing. His purchase of Coca-Cola shares in 1988 is a prime example. Despite periods of market volatility, Buffett held his shares, allowing the company's growth and compounding returns to generate significant wealth.
KO Coca-Cola Monthly Chart
Index Funds: Index funds, which track major market indices like the S&P 500, demonstrate the benefits of long-term investing. Over decades, these funds have delivered solid returns, often outperforming actively managed funds. Investors who stay invested in index funds, even during market downturns, benefit from overall market growth.
Common Pitfalls and How to Avoid Them
While patience is key, there are common mistakes that can derail long-term investing:
Panic Selling: Investors who panic during market downturns often sell at a loss, only to see the market recover later. Staying patient and focused on long-term goals helps avoid this costly mistake.
Trying to Time the Market: Attempting to predict market highs and lows is a risky strategy that often leads to missed opportunities. Staying invested allows investors to benefit from overall market growth without the risk of mistimed trades.
Overtrading: Frequent buying and selling erode returns through higher transaction costs and taxes. A buy-and-hold approach helps preserve capital and reduces unnecessary trading.
Conclusion
Patience is not just a virtue in long-term investing—it is a necessity. By maintaining discipline, staying focused on long-term goals, and avoiding emotional reactions to market volatility, investors can harness the full potential of compounding returns and achieve financial success. The strategies of setting realistic expectations, diversifying, and staying informed provide the foundation for a patient, long-term approach to wealth building. Through patience, long-term investors can navigate the ups and downs of the market and emerge with a stronger financial future.
Trading a Single Forex Pair: Choosing the Right One for SuccessNavigating the complexities of forex trading begins with choosing the right currency pair. Each currency pairing represents a unique relationship between two currencies, and mastering the dynamics of a single pair can offer traders a sharper edge. By understanding how a particular pair moves, traders can craft more effective strategies and reduce exposure to unnecessary risks.
Understanding Currency Pairs
In forex trading, a currency pair represents the value of one currency against another. For example, in the EUR/USD pair, the Euro (EUR) is the base currency, and the US Dollar (USD) is the quote currency. The exchange rate tells traders how much of the quote currency is needed to purchase one unit of the base currency. This core understanding is essential for crafting strategies based on price movement, market news, and economic indicators.
Base Currency vs. Quote Currency:
The base currency is the first currency listed in the pair and is the one being bought or sold. In EUR/USD, the base currency is EUR.
The quote currency is the second currency, showing how much of it is required to buy one unit of the base currency.
Types of Currency Pairs
-Major Pairs: These are the most traded pairs globally, including the US Dollar (USD) and other major currencies such as the Euro (EUR), Japanese Yen (JPY), and British Pound (GBP). Examples include EUR/USD and USD/JPY. Major pairs are typically more liquid, offering tighter spreads and more predictable price movements.
-Minor Pairs: These exclude the USD but involve other major currencies, such as EUR/GBP and GBP/JPY. While still liquid, minor pairs may have slightly wider spreads compared to majors.
-Exotic Pairs: These involve a major currency paired with a currency from a smaller or emerging market, such as USD/TRY (US Dollar/Turkish Lira). Exotic pairs tend to be less liquid and more volatile, with wider spreads and higher risk.
Key Factors for Choosing a Currency Pair
When selecting a currency pair, consider several critical factors to optimize profitability and minimize risk:
-Liquidity: High liquidity means you can easily buy or sell a currency without causing large price swings. Pairs like EUR/USD and USD/JPY are highly liquid, resulting in narrower spreads and lower transaction costs.
-Volatility: Volatile pairs experience more dramatic price swings. While this can present opportunities for larger gains, it also brings higher risk. Traders should balance their appetite for risk with volatility when selecting a pair.
-Market Hours: The forex market operates 24/5, with different trading sessions in various time zones. High liquidity occurs when major sessions, such as London and New York, overlap. Understanding which sessions affect the pair you’re trading helps optimize timing.
-Economic Indicators: Macroeconomic data—such as GDP growth, inflation, and employment reports—play a significant role in currency fluctuations. Monitoring these indicators for the currency pairs you trade will help you make informed decisions.
-Correlations: Some currency pairs are correlated with other markets, such as commodities or stocks. For instance, the Australian Dollar (AUD) is closely tied to commodity prices, while the Japanese Yen (JPY) is seen as a safe-haven currency. Recognizing these correlations can give you an edge when anticipating price movements.
-Spread and Transaction Costs: The spread is the difference between the buy and sell prices. Major pairs like EUR/USD generally have lower spreads, reducing trading costs and improving profitability.
Popular Currency Pairs and Their Characteristics
-EUR/USD: Known for its high liquidity and stable trading conditions, EUR/USD is the most traded currency pair. Its price movements are influenced by economic data from the Eurozone and the United States, making it a favorite among traders seeking reliable trends.
-GBP/USD (Cable): This pair is more volatile than EUR/USD, offering larger price swings, especially during the London session. It is sensitive to UK economic data and geopolitical events like Brexit, making it ideal for traders who prefer volatility.
-USD/JPY: This pair is less volatile than others and is influenced by US and Japanese economic data. The Japanese Yen (JPY) is also seen as a safe-haven currency, attracting traders during times of global economic uncertainty.
-AUD/USD: The Australian Dollar (AUD) is heavily influenced by commodity prices and economic data from Australia and China. It’s a great option for traders who want to capitalize on global commodity trends.
-USD/CHF: The Swiss Franc (CHF) is another safe-haven currency, meaning this pair is often less volatile and attracts traders during periods of global instability.
Developing a Strategy for Trading a Single Pair
Choosing to trade a single pair allows you to focus and specialize, giving you a deep understanding of the pair’s movements, news impacts, and market conditions. Here's how to develop a successful strategy for trading one currency pair:
-Monitor Economic News: For major pairs like EUR/USD, keep a close eye on economic data releases such as interest rates, employment reports, and inflation figures from the Eurozone and the US. News-driven trading strategies often work well with high-liquidity pairs like this.
-Leverage Volatility: If you choose a more volatile pair like GBP/USD, focus on breakout strategies or trend-following approaches. These pairs can offer large price swings, but effective risk management is crucial.
-Risk Management: Always employ Stop Loss orders to protect your capital, especially with more volatile pairs. Proper position sizing and diversification are also key to managing risk.
-Analyze Correlations: If you trade a pair like AUD/USD, understanding its relationship with commodity prices or China's economy can enhance your decision-making process.
Conclusion: Focus on One Pair for Mastery
For traders looking to specialize, trading a single forex pair can be a strategic advantage. It allows you to concentrate on the nuances of one pair, build expertise, and reduce the risks associated with juggling multiple assets. Whether you choose the highly liquid EUR/USD or the volatile GBP/USD, mastering one pair simplifies decision-making and enhances your ability to react swiftly to market movements.
In the world of futures or CFDs, focusing on a major pair like EUR/USD provides access to deep liquidity and tight spreads. With a strong strategy and the discipline to specialize, traders can avoid unnecessary distractions, manage risks more effectively, and enhance long-term success in the dynamic forex market.
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BTC/USD Halving 518 When will be the cycle price low and high.Main trend. Time frame 1 month.
This idea is almost a clone (in meaning, not visualization) of my previous idea published 1.3 years ago:
BTC/USD Secondary trend cycles and halvings.
For great visualization and clarity I added leap years (pre-pump, pre-distribution), this applies to all markets, not just the “young” cryptocurrency market... That is, after it, just the price is in the zone of distribution (sales), which is identical with the price highs of the secondary trend.
Bitcoin cycle 4 years:
Year 1 - birth of a new bullish trend (leap year).
By the way the next year 2024 is exactly like that. But, read carefully to understand the point.
For some time the price moves sideways or with a small rise.
Positive/negative alternates. Negative dominates.
There is no interest in the crypto market. The traffic of stupid money is minimal.
The volatility of the price of instruments is usually minimal.
This phase of the market is also called "participation" (more relevant to the second part).
In the final phase—active movement to the distribution zone (the zone of sales by large market participants—small).
In a given year (or near this time zone in the previous year), there is typically a second dump (second price low) with more aggressive dynamics by a large %.
Dump -60.66% 03 2020.
On the chart as an example of past dump at -60.66% (magnet) at the start of Corona 03 2020 (taking advantage of the world situation) before pumping the market in the future. Always keep this kind of thing in mind and be prepared for it, even if you are sure it is unlikely. Observe mani management.
Training idea/work 02 2020:
Trading by trends and important areas using the example of BTC
Something like a big triangle like 2020 is forming now.
BTC/USD Main trend (3 years) Channels Triangle 09 2023
Altcoins in this time zone cycle .
Altcoins tend to be in their accumulation channels. Alternately, from time to time, some are “firing” (usually of lower liquidity). Some produce “takeouts” under the dial zones.
The essence of this time zone for alts is to gain as much as possible % of positions from the market. The price is not important (the average price of a set is taken into account), alts typically follow the general market trend, which is logical and tactful from the position of long-term prospects of earning in cycles.
Year 2 - Bull Market. Trend price maximum and distribution zone .
Resetting positions by large market participants. That is, the smart money sells to the dumb at the market high.
The 17 weeks post-halving ( 518 days, gematria ) zone of perfect selling in crypto asset allocation. Roughly speaking it's a zone near price highs, at least that's always been the case in past cycles of bitcoin and the crypto market as a projection of it.
Altcoins in this time zone of the cycle.
Inadequate altcoin pumping. Typically, "old" cryptocurrencies are showing 5-10x (+500-1000%) of previous dialing zones. The average profit accumulation/distribution of almost any cryptocurrency is 5-8X, with the range of lows and highs (for hamsters) usually twice as large.
A huge amount of all sorts of crypto speculative garbage "promising cryptocurrencies" and "bitcoin killers" is created ... Pumped at the most inadequate interest with holding the reset zone for a long period of time due to the huge traffic of "stupid money".
It should be separately emphasized that in this time zone of the cycle huge traffic of “stupid money”, who want to get rich without understanding anything about it.
The crowd is not afraid to buy. This is key. The media is all about the positive.
A huge number of newly-formed crypto experts are young kids, whose expertise will disappear when the market turns around in the next sub-cycle....
Anyone can make money ("sitting on the trend"), even buying and holding anything for a while, of course, except for "promising high-tech crypto garbage" on inadequate pumps and with the same news positive accompaniment.
Absolutely all alts including high capitalization never repeat their price highs to bitcoin.
Year 3 Bear Market. Market dumps from area of distribution (selling) price highs to area of set (buying).
Price typically drops about -70%-80% on bitcoin
Typically, when a distribution support zone is broken, many scare tales or real negative news stories are created to scare and trigger a “crypto depression”. Subsequently, a mostly negative news backdrop dominates, usually of a made up fairy tale nature in “three lines” for the true fools.
Holders of “promising crypto” are bleeding, hope for the price to return to the previous value and "faith in projects" are gradually fading away. The final phase is dominated by the view that it's all a “crypto scam”. Bitcoin will "die." Toward the end of the phase, there is always a “bloody month” (price minimum)—before the formation of the dialing zone.
Altcoins in this time zone of the cycle.
Altcoins are declining from pumping highs before stopping the decline and moving sideways (set zones):
Highly liquid 80-90%
Medium liquid 90-96%
Low liquid (extinction candidates) from -95% and below % conditional on such "crypto trash on the verge of life and death".
Year 4 is the sideways zone, i.e. the accumulation zone. .
In this time zone after a significant dump (more than a year) there is a corrective price recovery movement. This is the so-called "intermediate bitcoin pumping cycle". We are just in it at the moment.
Altcoins in this time zone of the cycle.
Altcoins of high and medium liquidity depreciate, as a rule, by -90-93%. Once this % depreciation is reached, horizontal accumulation channels (1 major zone) of position set for the next cycle are usually formed.
"Cryptocurrency holders" who bought at or near price highs in the last cycle tend to all sell at a large loss in "tired of waiting" accumulation zones for their "promised bags of money".
Low-liquid altcoins depreciate in price by -95% or lower.
It is worth recalling that -95% from the previous -90% is -50%. That is another reduction of the deposit of the “grief trader” in two times.
A part of altcoins, which with a small "community of believers in the wrapper" - “dies”.
Often, the creators crypto run out of money for all sorts of marketing tricks. Then they pour the rest of their crypto phantom on the market, inventing some tale of hacking or something similar.... After that - "to the islands", until the next bull cycle. The sect of "deceived MMM depositors" scatters. The wrapper dies definitively....
Altcoins, including HYIP ones, which were created in the last cycle, are all depreciating. Out of the top 100 of the previous capitalization ranking, they depreciate beyond the top 1000. Never recover in capitalization and price not only to bitcoin, but also to the dollar in the future in the next cycle.
This is what bitcoin trend cyclicality looks like on a linear price chart
Apple Next Target is Channel TopNow Apple Successfully Breakout above the Resistance level and Trading Within the Channel. Apple Next Target is the Channel Top.
Refer this image, Before Breakout the Resistance level.
I shared the Same Channel Pattern on TradingView for Bitcoin. Refer to this Images, showing Before and After the Target was Achieved.
The Channel is used to identified the Next Target (or) Next Impulse. Refer below
I want to help people Make Profit all over the "World". Additionally, I am Eager to Receive Money form Worldwide because of my Potential. Thank you
Special words for gold trading
We often see these words when trading. If you understand them, trading will be easier.
Including "deposit, withdrawal, position, closing, take profit, stop loss", etc.; they mean:
Deposit: remit personal funds to the trading account for trading;
Withdrawal: transfer part or all of the balance in the trading account to a personal bank account;
Position: the name of the trader buying and selling contracts in the market; establishing a trading order is called "establishing a position", a buy order is called a "long position", and a short-selling order is called a "short position"
Closing: ending a held buy order or sell order;
Take profit: the trading order finally achieves the profit target and leaves the market with a profit;
Stop Loss: When the order loss reaches the maximum tolerable amount, admit the loss and leave the market;
In addition to the commonly used terms, there are also some special terms involved in the trading market;
For example: heavy position, light position, carry order, lock position, liquidation
Heavy position: Most of the funds in the trader's account are involved in order transactions
Light position: The trader only uses a small part of the funds in the account to participate in the order;
In trading, there is a most basic principle that "don't put all your eggs in one basket"
There are always risks in the financial market, and traders should remember one sentence:
Avoid risks, trade with light positions, and never hold heavy positions.
Light position standards:
Total loss of holding positions ≤ one-tenth of the account amount
The number of lots for a single transaction of 10,000 US dollars is not more than 0.5-1 lot
Carry order:
When traders encounter losses, they have no stop-loss strategy, do not know how to stop losses and choose opportunities to start over, but always hold losing orders and bet everything on the rise and fall of the market. This is a behavior that should be avoided in trading.
Locking:
Similar to "carrying orders", when traders encounter losses, they do not implement stop-loss strategies, but establish reverse orders while holding loss orders. Locking can only allow traders to temporarily stop further losses, but cannot get rid of losses. If the net value is not enough, a "black swan event" will occur, and the short-order spread will increase instantly, which will also lead to a margin call.
Margin call:
When the funds in the trader's trading account are not enough to trade, it is a margin call; margin call means the loss of all principal.
If you are a novice, these must be helpful to you! I will share trading knowledge from time to time, and you can follow me if you need it.
MFI INDICATOR - STRATEGY FOR TRADINGIndicator MFI — model
Incorporating technical indicators into your trading system requires a clear understanding of their fundamental principles.
An innovative solution developed by Gene Cuong and Avrum Sudak allows the use of volumetric data in metric analysis.
The Cash Flow Index serves as a graphical representation of the "cash ratio", requiring a preliminary derivation of the "cash ratio" and subsequent calculations, including the determination of typical price and cash flow.
Similar to the relative strength index, the cash flow index is based on the concept of a “typical price,” calculated as the average of the high, low, and closing prices over a specified period of time. For example, if the daily time frame has a high of 70,000, a low of 65,000, and a closing price of 68,000, the typical daily price is calculated as follows:
Typical daily price = (70000 + 65000 + 68000)/3 = 67666
Cash flow is then determined by multiplying typical price by volume:
Cash Flow = Typical Daily Price * Volume.
Comparing the resulting cash flow with the previous day's cash flow makes it easier to identify positive or negative trends. Positive cash flow indicates an increase, while a negative cash flow indicates a decrease. Cases of equivalent cash flow values are not taken into account.
When positive and negative cash flows can be distinguished, the cash ratio is calculated by dividing the former by the latter:
Cash Ratio = (Positive Cash Flow / Negative Cash Flow).
Using this data, the cash flow index (MFI) can be calculated using the formula:
MFI = 100 - (100/(1 + Money Factor)).
Gene Cuong and Avrum Sudak have delineated three primary signals employed by the Cash Flow Index:
Overbought or Oversold Levels: Traders strategically monitor for overbought or oversold conditions as indicators of unsustainable price extremes, signaling potential market corrections.
Bullish and Bearish Divergences: Analysis of bullish and bearish divergences serves as a predictive tool for identifying potential trend reversals. Discrepancies between the direction of price movements and corresponding Cash Flow Index trends can offer valuable insights into shifting market dynamics.
Fluctuations at 80 or 20 Levels: Observing fluctuations in the indicator readings around the 80 or 20 thresholds enables traders to discern potential market reversals. These pivotal levels serve as crucial points of reference, guiding traders in assessing market sentiment and making informed trading decisions.
Determining overbought and oversold zones using the cash flow index
While the relative strength index (RSI) and other oscillator-type technical indicators are capable of identifying overbought and oversold market conditions, the money flow index (MFI) stands out for its effectiveness in this area. Including additional volume information allows the MFI indicator to filter out false signals from overbought and oversold conditions, increasing its reliability, especially for traders looking to counter prevailing trends.
Like most momentum indicators, the Money Flow Index ranges from 0 to 100. A Money Flow Index reading below 20 indicates an oversold signal. Conversely, a Cash Flow Index reading greater than 80 suggests an overbought scenario.
One limitation of trading based solely on overbought and oversold signals is the inability to counter the current trend merely due to signals generated by the Money Flow Index (MFI). Optimal trading strategy involves exercising patience and waiting for a price action pattern to validate a shift in the prevailing trend before taking a position. By employing this approach, traders can make more informed decisions and reduce the risk of entering positions prematurely based solely on MFI signals.
The MFI Indicator and Divergence
Beyond its function in pinpointing overbought and oversold conditions, the Money Flow Index (MFI) indicator serves as a valuable tool for detecting divergence within the market. In essence, divergence manifests when the price moves in one direction while the indicator readings depict a contrary trend. Traders regard this occurrence as a strong indication that the price is poised to reverse in alignment with the technical indicator's trajectory.
Utilizing the MFI indicator enables traders to readily recognize such signals, whether they manifest as bullish or bearish divergence.
Bullish Divergence:
Bearish divergence:
What Should You Consider?
By integrating volume into its mathematical framework, the Money Flow Index is adept at generating highly precise trading signals concerning overbought and oversold market conditions. Additionally, it demonstrates a notable ability to pinpoint emerging divergences within the market. However, like any technical indicator, it possesses inherent limitations.
A primary constraint of the Money Flow Index is its propensity to persist in overbought or oversold states for extended durations, potentially leading to false signals. Yet, by crafting a trading strategy that incorporates price action signals, traders can harness the MFI indicator to identify potential reversal zones.
Armed with this insight, traders can anticipate shifts in directional price movement with ease and strategize their trades accordingly.
Summing It Up:
The Money Flow Index stands out as a unique indicator amalgamating momentum and volume within the RSI formula. Its strength lies in its adeptness at identifying potential reversals through overbought or oversold levels, as well as bullish or bearish divergences. Nonetheless, prudent utilization of the Cash Flow Index entails supplementing its readings with additional technical indicators rather than relying solely on its signals.
Liquidity as the Key to understanding the MarketLiquidity in the market is a key factor in price movement especially in the cryptocurrency market. Understanding how and where liquidity appears is fundamental to being able to determine the future price movement of an asset.
Liquidity:
I would like to start by showing what liquidity is and how it can be detected.
In our case, liquidity is the accumulation of buy or sell orders, and the more of them there are, the greater the opportunity to turn a currency into an asset and vice versa.
According to technical analysis, an asset has so-called price levels from which further downward or upward movement occurs. Exactly from these levels on the chart, which are seen by all traders without exception, trades are opened, and stop-losses are set for the nearest minimum or maximum. Thus, liquidity is accumulated behind the levels, which acts as a magnet for the price as it is of great interest for big players to fill their orders.
90 percent of traders' stop losses are very close to each other, therefore, with a significant force of price movement in one direction and subsequent interaction with the level of support or resistance, positions are liquidated and a sharp purchase or sale of an asset at stop losses occurs.
Please pay attention to the main point. Liquidity is a tool for price movement used by big players. Always keep this in mind.
Gap:
A gap is a result of low liquidity in the market and a high trading volume of the stock. Gaps are important for technical analysis because they signal shifts in the supply and demand equilibrium. Major gaps indicate a substantial imbalance between buyers and sellers, causing a swift repricing.
It is always important to remember that gaps are visible to every market participant and many people when a gap appears start opening trades directed towards its filling thus provoking the emergence of liquidity. In turn, this can lead the price in the opposite direction to the one where the gap is located in order to liquidate recently opened positions of cunning traders. But as a rule, the price eventually comes to the gap and fills it partially or completely removing inefficient pricing. You can think of it as a magnet for price.
Fair Volume Gap:
FVG (Fair Volume Gap) has the same meaning as a gap (i.e. a magnet for price) but not all traders are focused on this kind of inefficient pricing. In this case it is also significant that according to the common technical analysis the level of 0.5 major candles is used as a strong level of support and resistance and therefore liquidity will be near these levels. Thus FVG filling is achieved also at the expense of ordinary traders buying or selling from these levels.
Luquidity pools:
It is also worth mentioning the so-called liquidity pools. These are often staggered liquidity clasters combined with zones of inefficient pricing, which together lead to very significant and rapid price movements.
Let's look at the essence of this by the example of how a sharp upward growth occurs. Gradually, a major player moves the price down, leaving liquidity on top and not touching it at all, since we will still need it. When long positions are sufficiently liquidated, we can start collecting liquidity from above. And since this liquidity has not been affected at all, sharp liquidation of short positions level by level occurs. It is worth noting the significant impact of inefficient pricing zones through which the asset, as if accelerating faster, reaches clusters of liquidations and, accordingly, a very rapid growth of the asset occurs.
These are the basics that I hope will help you improve your trading.
I plan to continue developing the topics of liquidity, pricing and the principles of determining price movements. What do you think about it?
Level breakdown. The most effective setupsWhat is a level breakout?
A breakout is the price's consolidation above a certain level followed by further movement in the direction of the breakout. But the immediate question that should arise in your mind is about the consolidation of price, as it might be difficult for inexperienced individuals to understand. However, there is nothing overly complex about it either; consolidation refers to the candle closing above the level
A breakdown can occur at a horizontal or inclined level.
Bullish breakout:
We observe a trending market encountering resistance at a horizontal level. After two unsuccessful attempts, the price breaks through the level.
Bearish breakout:
Why do level breakouts work?
Imagine a scenario: a strong resistance level on the chart is heavily defended by bears, preventing the price from breaking through. Despite several attempts, the bears hold their ground until the bulls come to the rescue. They overpower the bears, but their strategy doesn't end there. Instead of retreating, they press forward, driving the opposition towards the next resistance level, where the cycle repeats.
Breakouts occur when the price breaches a significant level. Observing price movements on a chart reveals that prices often consolidate and encounter specific levels.
When the price reaches a level and swiftly reverses, it indicates the strength of that level. Upon a price retest of this level, careful monitoring is essential to anticipate a potential breakout.
Repeated tests of the same level signify its strength, yet eventually, the price will break through any level. This is when traders should be prepared to initiate a breakout trade.
Breakouts offer lucrative trading opportunities because they often mark the inception of new price movements and trends. By entering trades at the onset of emerging trends, traders position themselves for potential profits.
Moreover, reliable breakouts typically occur during periods of robust price momentum when traders seek to capitalize on rapid price fluctuations.
Breakouts occur at important price levels. It can be:
Support or resistance levels.
Patterns
Market highs or lows.
Trend lines.
Price channels.
Moving averages.
Fibonacci levels.
One reason breakouts can lead to rapid price movements is due to the attention they attract from market participants monitoring key levels. When one group of traders capitalizes on a breakout, another group is compelled to swiftly exit their losing positions, resulting in sharp price fluctuations post-breakout.
There exist various types of breakouts, and as traders, our objective is to identify high-probability breakout opportunities and initiate trades. However, this task is not always straightforward. Consequently, levels marked at potential breakout points should be regarded as zones rather than rigid lines.
Identifying Psychologically Important Levels:
Repeated testing of a specific zone by the price often signifies its significance.
Having reached a certain level, the price enters a sideways movement, forming a consolidation. Using a rectangle, we outline the area encompassing the lower wicks of the candles, delineating our support/resistance area. When trading breakouts, it is wise to wait until the candle closes outside the support or resistance area to confirm the breakout.
Triangles are chart patterns indicating price compression, often culminating in a breakout. The direction of the breakout is typically uncertain.
Within the circle, you can observe the precise location of a potential breakout. Notably, there is a robust breakout momentum evidenced by several full-bodied candles. Subsequent to breaching the upper level of the triangle, the price retraces to test the previously breached resistance, now acting as a support area. This pullback serves as a crucial confirmation signal.
Breakouts and false breakouts:
Typically, candlestick shadow breakouts are not considered true breakouts. A true breakout occurs only when the price finally closes outside the level. This approach provides a more secure entry point, making it easier to open positions in the appropriate direction.
The upper rectangle constantly holds down the price, with the exception of some candles, characterized as a pin bar. This represents an initial false breakout as only one candle breaks the resistance area but fails to close, leaving its body above that area. Therefore, we classify this signal as false.
However, the subsequent pin bar pushes the price higher, causing the candle to close above the resistance area. This is a genuine breakout signal, especially enhanced by the presence of a strong, saturated breakout candle.
Trading Breakouts:
Trading market breakouts carries inherent risks due to the prevalence of false breakouts, which are statistically more common. Therefore, it is extremely important to understand the market structure and monitor the movement of prices to the appropriate level.
Markets operate in cycles, moving between trending phases and periods of consolidation. The duration of market consolidation correlates with the strength of subsequent breakouts and subsequent trends.
Prolonged consolidation periods are not only observed by you, but by traders worldwide. Among them, some opt for trading bounces from levels, while others prefer trading breakouts. Extended consolidation behind a resistance level can trigger stop-loss orders for many bears and prompt numerous bulls to initiate new buying positions. Consequently, after prolonged periods of flat movement, prices frequently surge explosively following a breakout, ushering in a robust trend.
The breakout trading strategy offers multiple entry approaches, allowing traders to select the one that aligns best with their preferences and objectives.
Entering the breakout after the price has consolidated beyond the zone:
One strategy assumes that the breakout occurred when the candle closed outside the level. While this pattern can be effective, I personally find it risky due to the many nuances associated with this strategy. Instead I prefer a different approach...
Breakout entry with retest:
This tactic is a bit more challenging as it requires patience and discipline.
What particularly appeals to me in this strategy is that I rely on additional data during a potential retest (with a 60-70% likelihood after the zone is breached).
Breakout of the symmetrical triangle pattern:
As the market tightens its consolidation, it eventually breaches the support of the triangle, followed by a retest of this level as new resistance.
For the stop-loss placement, it's advisable to position it inside the triangle above the breakout candle.
Regarding take profit, we target the nearest level, ensuring the risk-to-reward ratio remains acceptable.
Best Breakout Trading Method:
Accumulation of positions/liquidations - consolidation.
When a tight consolidation occurs near a resistance level, it tells us that buying pressure remains high for a long period of time and sellers do not have enough strength to reverse the price from the level.
When the price breaks through a resistance level, traders with short positions cut their losses. At the same time, the pressure from buying traders who will open breakout transactions is increasing. All these factors cause the price to rapidly move up without significant pullbacks.
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I have only covered a portion of the basics. Of course, trading involves various elements such as price action, indicators (divergences), but that would make this post too long ;)
If you enjoy my educational articles, please leave comments, and I'll continue writing them.
BTT/USDT Psychology. Reversible evolution of hamster thinkingLogarithm. Time frame 4 hours.
1️⃣ Exit from the long accumulation by pump the price using the “stick” method +135%. From the average price of the accumulation +200%. CODE 237 (pump time)
2️⃣ Formation of bullish (ascending triangle). Not returning the price after the pampa by a significant percentage to cause bewilderment and regret about the sale of those who sold with profit).
3️⃣ Breaking through its resistance and fixing the price. Special clamping of the price with orders to "compress the spring". Launch of positive “news” (background to accompany the price movement). Expectations for the majority to see the “connection”.
4️⃣ Further development of the game with a round dance of those connected to the "money egregor", without antivirus (knowledge and experience). Pulling their strings in thinking using greed and low intelligence. Waves of trend development and position resetting.
Head and Shoulders Tutorial on Crude Oil ChartI have decided to start a short series of tutorials covering common instruments used in technical analysis.
In today's tutorial, we observe a successfully identified head and shoulders pattern on the 4-hour chart of Crude Oil, resulting in a substantial movement of around 17%.
Here's how to find the instrument: navigate to the left sidebar and select 'Patterns,' where you will find 'Head and Shoulders.'
Analyzing and trading correctly involve the following steps:
1) Both shoulders must form within a rising or falling trend. In the case of that Oil chart, we observe a rising trend, indicating a potential short position.
2) The size of the head becomes our target for take profit (TP), and upon reaching TP, we close 80% of the position.
3) Ideally, volumes at the right shoulder should decrease, and upon breaking, they should increase.
Risk Management Strategy:
1) Limit each trade to no more than 2% of your deposit.
2) Always utilize stop-loss and take-profit orders.
3) Never trade money you are not prepared to lose.
4) Start with small budgets.
It is crucial to emphasize that risk management must be adhered to whenever you engage in trading!
Register and trade stocks and crypto using my link with a discount on commissions: bingx.com/invite/E6RCUFJT
PORTO Basic Trend. Psychology. Volatility or super ticker?Logarithm. The time interval is 3 days. Cryptocurrency as an example. Cryptocurrency with high volatility (low liquidity) for dump/pump strategy.
Primary trend — horizontal channel.
Secondary trend — descending wedge.
Local trend — consolidation after a wedge breakout.
Line chart without “market noise” (volatility, squeezes).
Immediately want to note that low-liquid cryptocurrencies better still trade on liquid exchanges, otherwise you are already your deposit succumb to a huge risk trading on exchanges with a small total turnover of funds (survivability, competition).
Psychology. Volatility and market cycles are your friend, not the ticker name! .
Notice what % the price slippage was. This was leaked to the market by the creators of the phantik (just in case), everything can be tracked on the blockchain, any sale at any price is profit.
Everyone does it, but with such low liquidity, it's very visible on the chart as well as on the blockchain. It's not something "scary", it's normal behavior of smart people who "don't believe in crypto wrappers", not just someone else's, but even their own.
Unlike stupid market participants who determine the value of a particular cryptocurrency, with the help of a particular cryptocurrency ticker (legend of usefulness to the industry). Because of this, there are thousands of phantoms and such market participants make up whole herd sects (they are entertained by selling "nothing" and making real money on the belief in crypto projects).
I think every market participant has their own set of phonies in their portfolio. I'm sure a larger percentage of cryptocurrencies are the ones that "youtube and telegram bloggers are talking about" and not through their own independent analysis. But you have to realize that everyone's cryptocurrency combinations are different..... because there are more than 13,000 alts......
Generally, cryptocurrencies rise behind the general trend of the market, and some will occasionally "overtake the market" and then deflate to the general trend..... You can play around with this and "wait for the overtake". It is very important not to get attached to the ticker name (real or not real scam). The desire to get rich with a "special cryptocurrency" clouds the mind....
Increase the probability to more than 50%When investors engage in trading, the outcome of prices can either rise or fall, with the probability being 50% (Just like the rise and fall of prices, it is either up or down.)
Prices fluctuate up and down, at that moment, traders may rejoice at the profit numbers or be dismayed at the outcome of losses. After a while, the situation may flip into another form. This is the reality that traders face all the time. They might lament internally about not closing a trade for profit, or they might complain about the heavy negative result. This is unpredictable, but we adjust the probabilities if we understand the mechanics of trading.
Diving into details briefly:
1. Pair Selection
An instrument is a tradable asset, or a negotiable item, such as a security, commodity, derivative, index, or any item that underlies a derivative.
2. Chart Analysis (Technical Trading)
Conducting technical analysis by examining price charts, patterns, and indicators to make informed trading decisions.
3. Money Management
Implementing effective financial strategies to control risk, determine position sizes, and protect capital while maximizing potential returns.
The question about what is most important will receive different answers depending on each person. Additionally, it depends on the situation and the objectives of each individual. To provide a more comprehensive summary, let's break it down:
Time:
Some people may see the importance of efficiently managing time to achieve desired results in both work and personal life.
Investment:
Some may emphasize the significance of investing money for maximum benefits, fostering financial growth in the long term.
Personal Discipline:
Others may find importance in maintaining personal discipline, such as working efficiently, setting goals, and following through with plans.
Emotional Management:
Some might prioritize the importance of happiness and emotional balance, including taking care of mental health and personal well-being.
The most important thing depends on individual perspectives, values, and how these different aspects are integrated for a well-rounded balance.
*If there is time, I will come to elaborate further.
Altseason Indicator. Capitalization excluding BTC ETH USDT USDCLogarithm. Time Frame 1 week. Understanding the capitalization and growth potential of altcoins without BTC ETH and top steiblcoins USDT, USDC and DAI gives a brighter and more accurate picture of the timing of the start and development of that long-awaited altcoin season of more pronounced scale than now on 16 10 2023 - at the time of publication 8 12 2023.
1) The capitalization of these assets has long been in a squeeze - consolidation, this is a direct correlation with the accumulation zones. We are conventionally in the final phase of accumulation (almost).
2) Please note that there has been no real capitulation (perhaps there will not be, and if there is, it will be V figuratively, but that is not the point). Very much emphasize your attention to the timing of the length of this phase and past late 2018 and 2020.
3) Also note to your eye that at that time 2018-2020 there was not such a big capitalization outperformance from the rest of the BTC and ETH market. Compare that to the situation now, how much other altcoins are "undervalued" speculatively. You also need to realize that there is a correlation with stablecoins and their huge portion of the overall market compared to the time before.
How to enter these parameters on tradingview? .
In order to capitalize alts from TOTAL3 (initially without capitalization of BTC and ETH) and exclude all large-capitalization stablecoins from it, you need to do the following:
In the ticker entry line in tradingview write:
CRYPTOCAP:TOTAL3-CRYPTOCAP:USDT-CRYPTOCAP:USDC-CRYPTOCAP:DAI .
Accordingly, a chart is created that subtracts the capitalization of the designated stablecoins (USDT, USDC, DAI) from TOTAL 3.
TRADING MASTERCLASS 101Today i explained to you guys the basics of the luftwaffe strategy and how to trade when you see a LUFTWING candle. Thanks so much for your time guys...
1,2,3 Confirmation PatternWhat does it consist of?
It consists primarily of 3 candles, and the fourth one is where we will enter the operation. In a bearish scenario the High of 2nd candle must be higher than the high of the 1st candle. The high of the 3er candle must be below the high of the 2nd candle. The 4th candle must re test the point of origin of the 3er candle.
How can you use it?
It is extremely important to complement and use this with a strong idea of where the price is heading. To know where the price will move, we need to understand that it moves towards the most liquid areas. The most liquid areas can be the unfulfilled Daily, Weekly, or Monthly lows and highs.
Where should you place the entry?
You should wait till the 3er candle close and place the entry at the point of origin of the 3er candle.
Where should you place the stop loss?
The stop loss should be above the 3er candle.
Important
I use this technique in D,W and M timeframes. After establishing a bias I look for the pattern. After the 3er candle is complete I move to 1hr or 15minutes to find the point of origin of the 3er candle.Then, I place the order.
Ethusdt looks bearish not financial advice Hello this is a tutorial for eth. NFA!
Eth will fall into 1475$ then to a new lows
This chart is not for trade now if there is a opportunity I will post it.
Enjoy and follow for more.
