When it comes to the world of trading one of the important decisions you will need to make is which trading strategy suits you best. Are you interested, in day trading or swing trading or just holding your coins ⁉️ Are you looking for long term investment opportunities⁉️ This decision will shape your trading journey. Have an impact on your potential outcomes.

At present and in the different types of markets, various types of Trading are handled, which are necessary to know them to know what our inclination is in them, and today I will briefly explain what is Scalping, Day Trading, Swing Trading so you will know which is yours and why you like to operate like this.

Regardless of where you are on your crypto journey, you want to have a plan. In fact, you NEED to have a plan.

A brief intro in case you are just starting out in crypto

🔹️HODL : this stands for 'hold on for dear life' and typically is an ideology of the die hard cryptologico cryptonian who believes in their coin to the death and you cannot pry their tokens from their cold dead body if you try. While the HODL is an intentional investment strategy, it also lacks a few important key features in strategy. For instance, at some point there should be an actual plan to lock in profit, pass the HODL on to generations to come, or attach a way to utilize the coin's rising value in place of fiat. These are big challenges to the HODLer. In addition to a true blue HODL, there is the HODL by force, where someone is 'stuck' with their HODL bags, or coins that drop so fast and furious Vin Diesel comes ready to run over the market price with a tuner car. The unintentional HODLer often finds a sense of community among others going through the same thing, because crypto markets come and go in cycles, so if a person is going AltCoin crazy, there is a good chance some time in the near future, they will be joining thousands of others who are down in the dumps at the question to whether their bags will ever revive.

🔹️Investing : while similar to the HODL, is a long duration with a target. Investments are designed to have a forward view of the gradual long term value of an asset, but there is a strategy behind investments. A person may long or short an investment depending on their research, but typically you can stack up investments much like the HODL, but the end game truly is about taking profit, either in one big pay off after a target sell, or choosing key landmarks to grab some profit while allowing some of the asset to mature. Investments in traditional finance often include incentives like dividends that help a person feel good about holding long term, and even to consider rolling those dividends into new shares, or coins.

🔹️Swing Trading : this is the next longest duration a person might trade, and this is very fast paced for most people in crypto. Swing trading is essentially studying the market with a plan to set up a trade that one believes is a good low buy on day one, in order to sell at peak day two. A swing trade is meant to take 2 days, 3 days max. 

🔹️Day Trading : This is the fastest pace category for trading, where the person intends to grab profit intra day... the same day. 

I can take this even one step further, to label the fastest form of day trading, as scalping, where a person is literally just watching the market momentum for a chance to quickly swoop in and grab a tiny profit and go.

Each of these trading plans come with a myriad of interesting options. I will break these down in future posts because I like to do so. For here, consider this an overview across all categories.

The HODLer and Investor can both do something that they will benefit from, which is to DCA, or Dollar Cost Average.

This is essentially a strategy to buy at regular intervals, a set amount of their asset, regardless of the current price. You can imagine that in crypto there is a plus and minus to the real die hard set it and forget it DCA model. In crypto, we like to call it "staking sats". The person doesn't sell, but does regularly add to their asset over time. 

Statistics are a fascinating thing, and theoretical math has some mysteries that I will never grow tired of. In this case, the fact that averaging simply works just absolutely fascinates me. Much like the wisdom of the crowd and other statistical truisms that just don't seem possible, dollar cost averaging proves to be a way to gain value while investing without the stress of watching the market regularly, and it typically means a person will sometimes intentionally buy the dip, other times buy right at the peak, and yet other times anywhere in between. Over years it all averages out to a decent average market value.

A slightly more sophisticated model for the DCA, which I personally believe in over the above, is to plan to add to the HODL over time, and choose a set amount, or even a fixed percentage of earnings if you think that may sometimes mean contributing even more, but when it is coming around to the time where you should make a purchase, actually watch the market and aim for a daily or weekly low. There is usually enough data and fluctuation in crypto to warrant outperforming the average just by taking a little bit of interest in the market. You don't have to nail the dip for this to be effective, but you do have to be consistent.

For the investor, while it is very similar to HODLing, there is room for DCA, but also selling profits when the market does extremes, and waiting for a correction to buy the dip. In this case, you aren't selling the asset because you gave up on the HODL and it isn't because you 'believe' in the fiat it is sold to. You do this in order to gain more of the asset you believe in. An example would be, if an asset regularly fluctuates up and down by 10-15%, there is plenty of long term data to let you know when an asset is nearing a peak or dip. You may as well sell some at a peak, hold on until it is below the average around that time, and then use that profit to buy the same asset again. You just gained momentum on your long term investment and this does not sacrifice your long term ideals.

Another option here, similar to what I mention with a more flexible DCA, is to simply 'buy the dip'. This makes sense if you have a lot of money and can afford to regularly add more every time the market takes a dive, but you don't want to risk selling any at peaks and you firmly believe in the asset long term.

There are mid term trading strategies over weeks or months that make sense just like the longer investment trend where you can apply everything you've read to these medium length trades.

Now, we get into the swing trade. One might think it is easier than day trading, and I suppose it should be. For me it is not. My belief for every person in crypto, is that anything other than a HODL should be based around your personality. If you are interested in trading and dedicate yourself to learning and testing your skills, then you should come to a point whether long, mid, or short term fits your understanding and talents. For me, I see patterns and sense a pulse of activity that makes for very high accuracy in short term volatility, which is not for most people. The swing trader can look at weeks and months of market movement and get a strong sense for a set up that takes hours to reach the perfect entry point, and they have a level of confidence that the price will rise to a good target percentage after a day's maturation. You have to have a sense for that laborious 12-24 hour waiting period, not touching the position ahead of time.

Day trading is for those who are good at developing a strategy and sticking to it. You have to have some kind of keen insight into what things typically do, and specifically you really need to know your assets well. You need to understand how other coins affect the movement of your coin and a myriad of other things, and because of the fast pace where things can go south very quickly, it is vital that you also pay close attention to FA, or fundamental analysis, meaning what is happening on the coin's social channels, what is happening market wide and even world events that can change sentiment on a dime (or a sat). The goal in day trading is not to get the biggest profit, but the most repeatable profit. Success in day trading can involve numerous strategies as can all trading, but specifically, a person can momentum trade with the market movement, adapting live to second-by-second conditions, or they can adapt to slightly longer trends. The best day traders are going to target a specific range of profit and stick to the plan even if it sometimes means leaving some of the peak on the table. It is about being able to repeat moves that work and accumulate the day's earnings. Most day traders will choose to cash out at the end of a day's cycle no matter what, while others will decide whether it is okay to carry trades over if they did not perform as expected, but are still within range of clearing at profit after an extra day, which then becomes a swing trade.

Understanding Day Trading Expectations

If you are considering day trading as your approach your main goal is to secure profits within a single day. To set expectations it's crucial to focus on capturing a portion of the daily price range. Even if there are times when you miss out on 20% of both the upper price limits there's still potential for a 60% gain. It's essential to understand and become familiar with the price range to succeed in this endeavor.

How to Prepare for Day Trading ⁉️

Now let's dive into some practicalities. Thriving in the world of day trading requires fine tuning your trading setup. To achieve your trading goals it is important to set a profit target within a time frame.

SCALPING - Understanding Timeframes - The 5 Minute and 15 Minute Intervals

In the world of day trading timeframes play a role in guiding your decisions. It is recommended to focus on two timeframes; the 5 minute chart and the 15 minute chart. The insights derived from the 5 minute chart will help determine your short term exit strategy while aligning it with signals from the 15 minute chart.

Remember this principle,Whenever you receive a buy signal on the 15 minute chart carefully look for corresponding buy signals on the 5 minute chart. Conversely, if there's an indication of a selling opportunity on the 15 minute chart, search for sell signals on the 5 minute chart. Staying focused on these time intervals that match your trade is crucial for successful day trading. When you're involved in day trading it's really important not to overlook the 60 minute chart. This broader time frame helps you assess the trend. Make sure to pay attention to any crossovers of moving averages as they could potentially indicate a shift, in trend.

The Flexibility of Swing Trading

Now let's shift our focus to swing trading a strategy that falls between day trading and long term investing. Swing trading involves holding positions for days or weeks to capitalize on price swings within a trend. It's an approach for those who want to balance gains with a more relaxed trading schedule.

Developing a Swing Trading Plan

For aspiring swing traders creating a defined plan is crucial. Start by identifying whether there's an uptrend or downtrend, in place. Use technical analysis indicators like moving averages and oscillators to identify entry and exit points. Swing trading involves an element called risk management, where you set stop loss orders to limit losses while maximizing gains.

Taking a Patient Approach Long Term Investing

For those who prefer a patient approach, long term investing provides an alternative. Long term investors usually hold onto assets for years relying on the power of compounding and the growth potential of their chosen investments. This strategy is suitable, for individuals with a risk tolerance and those who prefer to take a hands-off approach to managing their portfolio. Constructing a long term portfolio requires thought. It's important to diversify your holdings . Focus on investments that have fundamentals and a proven track record of growth.

In the changing world of trading, the strategy you choose will shape your trading adventure. Whether you prefer the paced nature of day trading, the strategic maneuvers of swing trading, or the patient approach of long term investing, each method has its strengths and challenges. Success lies in discipline, continuous learning, and a thought out plan.

3 useful tips when deciding to Trade:

1• Never forget that the odds of a long trade being a winner increase when your entry is as close to the demand zone as possible.


2• Don't make your entry immediately when the price reaches a demand zone, always expect the price to form an HL above the previous low, if the price action does not show a reversal pattern, the price will not go up.

3• Never forget to place your stop losses, they allow you to save time and adjust your loss tolerance based on the risk level of the current scenario.

#CryptoTradingGuide