Before opening a market position, it is important for a cryptocurrency trader to answer a series of questions. The responses to them develop a trading plan that every trader should have. It should be written on paper (or printed in Word). This can save the trader from making unreasonable, unprofitable transactions.
Strict adherence to the trading plan – will be the basis for competent trading. Rejection of it will lead to wasted time behind the monitor, excessive emotion, erratic actions and in 99% of cases, the deposit will drain.
It is a clear trading plan for each transaction that will become the “holy grail” that traders all over the world hunt. Many of them have heard of a certain trade plan, which supposedly should be followed, but only a few realize that it really is.
During the development of a work plan for a transaction, the trader answers a series of questions. This allows you to transfer information obtained from charts and news to the reflex level. When realizing a trading situation, memory at certain moments gives and extracts the necessary fragment, and this is how a sense of the market is developed. It takes time to memorize typical market situations.
At first, the results may be inconspicuous, so traders ignore this kind of trading and turn to entry points and a number of special techniques. Progress will appear after 1-2 years of daily practice, and the first results can be expected at least in 5-6 months. Few people are willing to wait for success for so long, although a lot of money in trading can be earned by experience. Consider the stages of work on the TG.
The idea is primary. It must be confirmed or not. For a trader, a hint should show the current market situation. You shouldn’t invent anything “from the ceiling” and “suck out of your finger” only because of the analysts’ messages.
The answer here should not be “What if it turns out …”. This is a blunder that can only lead to a sink. It is important to remember that position outside the market is also acceptable. Perhaps even more acceptable than the position in the market, and certainly more acceptable than the “blind trade”.
Many cryptocurrency traders are trying to predict where the market will go. This is a blunder that makes us not to analyze, but to choose between the two opposites, which leads to a drain on the deposit.
Each idea has several conditions for implementation. If a large operator is absent, and COT reports show an uncertain picture, the market has entered the range position – it does not matter whether to buy or sell, you need to open a position in the direction indicated by the market itself.
After opening a trade, it is important to determine the level of risk that arises when checking a trading idea. It is necessary to determine the position in which to open the opposite transaction. This is the stop-loss point.
The question of whether or not the market breaks through this particular level is erroneous. To close a position there must be a real reason, a condition that the market will demonstrate. To leave the transaction “just like that,” for no reason, because it is “hard to sit”, because it is scary, it seems that the volume of the transaction is large, the market has gone too high, is a gross mistake.
“The trading formation is important, the specific conditions for entering the position and understanding at what point in time you need to enter. It is better not to open new positions after dinner – it will be either a false figure, or the position will not work. All of this, including the temporary discrepancy, should be fixed, ”says Mark Sorokin, an analyst at MINE crypto corporation.
Important here is the knowledge of trading formations. Most often this is the shortage of tops and lowlands or the formation of a double bottom with the overcoming of daily lows (highs). It is important to fix them in the form of drawings. In the event that this is a long accumulation, one must wait for the output from the side and fixing the price – and one can join the movement.
In the latter case, preference is given to the outboard of a duration of three days. This is a sufficient accumulation with which to work in the future. Until the price comes out of the outset, one cannot say for certain where the market will go.
If the opening of the transaction is not in priority, but you need to trade, the lot can be split up, for example, by 1/10 of the average standard, or you can close part of the position, if possible. Even if the market goes into plus, but we can expect a correction, a 50% position is fixed. Thus, the lot is transferred to breakeven.
It is necessary to correctly assess trade risks for each specific transaction. In the traditional market, this figure does not exceed 1%, for cryptocurrency – 3-5%. If the risks are higher, the transaction should be abandoned.
Important points should be fixed so that they are always before your eyes and constantly re-read. You can write in notebooks, smartphones for these purposes are less convenient.