๐ NEVER BUY ON ROUND NUMBERS ๐ซ๐ข
This post will be a bit technical, but it will greatly enhance your understanding of the market. Read it carefully, and feel free to reread it if needed. ๐๐
Many of you probably use "Limit" orders to buy or sell your cryptos. For those who don't know, "Limit" orders allow you to buy or sell automatically at a certain price. For example, if you want to sell 1 BTC at $68,500, you place a Limit sell order at $68,500, and it will automatically sell your BTC when it reaches that price. ๐ธโ๏ธ
However, it's crucial to understand that you should **never place Limit orders at round numbers** like $70,000, $75,000, or even $75,500. Here's why:
### Why Avoid Round Numbers?
1. **Psychological Levels** ๐ง
- Round numbers are key psychological levels where many traders place their orders. This means there's a lot of competition at these levels, making it harder for your order to get filled.
2. **High Volume of Orders** ๐
- At round numbers, the volume of buy and sell orders is significantly higher. Your order can get lost among thousands of other orders, requiring more money to fill.
### Example:
Imagine there are 1,000 BTC for sale at $70,000. To fill all these orders, 1,000 BTC need to be bought at this level. However, the chances of 1,000 BTC being available for purchase at this exact level are slim. Now, if you place your order at $69,999 instead, it won't change much for you but will set you apart from the crowd. This increases the likelihood of your order being filled. ๐๐
### Practical Tips:
- **Avoid Key Levels**: Steer clear of placing orders at round numbers.
- **Set Slightly Off**: Place your orders slightly below or above these psychological levels (e.g., $69,999 instead of $70,000).
- **Universal Rule**: This applies to all cryptos and any round number. ๐๐ข
Feel free to ask your questions in the comments if anything is unclear. This post represents my personal views. Thank you for reading! ๐๐read the feed post๐๐ป๐๐ป๐๐ป๐๐ป
