Disclaimer:
(1) This is not written by ChatGPT or AI. It's written by me after gaining 2 months trading experience.
(2) I am not a financial expert, trade responsibly.
(3) All traders lose but make sure to win more than you lose. Gaining $1 in profit is better than losing $10. So be responsible.
Get started.
1. Candlesticks
A candlestick has the following major characteristics.
- It can be bullish or bearish
- It has a body which is the big part of it.
- It has the opening and closing sides
- It can have wicks at the top and bottom side. These are the small lines at the top and bottom of a candlestick.
- Green and uncolored/clear candlesticks can indicate a bullish price (buyers winning in the session) and the price is high during this given time-frame.
- A red or black candlestick indicates a bearish price (sellers are winning the session) and price is low during this given time-frame.
- Each candlestick can have a different shape. The shape determines the name and meaning of the candlestick in the market.
- Each complete candlestick
2. Market structure
A series of candlesticks form a shape in a given time-frame. This shape is good to determine the trend of the market.
The trend of the market can be uptrend, consolidation or downtrend.
The uptrend(bullish) and downtrend(bearish) are composed of two major directions which are the impulses and corrections whereas the consolidation trend is composed of sideways pricing where none of the buyers and sellers is making major price wins.
To make profitable trades it's recommended to make entries during uptrends and take profit when a downtrend is starting or in the middle to avoid losses. You want to profit or break-even instead of making loses.
So if you can't predict the trend of the market don't trade. Instead buy trustable coins and be patient to profit from longterm holding.
If you are a day trader it's recommended to look at the trend of previous week then trade in the 1 day price action. Then for a scalper you can review the trend of previous day then trade in the 4 hour price action. So on and so forth.
3. Demand and Supply zones
These zones are a good way to predict where the market direction could go. A demand formed by 3 candlesticks where the wick of candlestick at left closes then followed by a significant bullish candlestick and wick of the right side candlestick closes leaving a vertical gap. This gap is an market imbalance and soon it will be tested by the market usually through price corrections.
As a Trader take advantage of this, make an entry and set a stop loss at the opening price of the bullish candlestick - 1.5%.
Then make an exit at the available supply zones to avoid losses.
Supply zones are found in the gaps left in bearish candlesticks.
4. Resistance and support
Expert traders analyze these to predict potential market direction changes. Then they take advantage of this. But beginner and intermediate traders will always miss out on these and make significant losses. I don't recommend relying on this.
5. Candle Range Theory
Candle Range Theory is the commonest way to analyze price direction. By just looking at the previous two candles in the session, you can predict price direction and do the needful.
To learn more get books about candle range theory or search candle theory on YouTube.
If this post has been helpful consider following me, commenting and sharing.
You could also share some $usdt or $xrp to support me
Trade responsibly