HIGHLIGHTING THE DIFFERENCE BETWEEN A NEW AND VETERAN TRADE
SCENARIO #1: BUY/SELL DECISION MAKING
New Traders:
- I can buy at this level since it looks like it's about to climb higher and I can bet with having to gain 500% with this 50x leverage.
Veteran Traders:
- I can do more short positions at this level as the major resistances have just been broken and more shakeouts could potentially happen increasing possibilities for retracements and rejections. I will definitely use 5x leverage on this one with around 0.25%-2% margin and set up stop loss around this invalidation and take profit with these targets I've set up.
SCENARIO #2: FORUM
New Traders:
- Guys, I really think this token will continue to reach this key level and I'm assuming you guys must be thinking like this too.
Veteran Traders:
- With this price surge, we can safely assume that there are potential reversals that will take place as more buyers will join the rally and we can join the reversal instead of the rally with safe leverages and margin allocations.
SCENARIO #3: APPRECIATION
New Traders:
- Boom, boom, boom!!! I hope this token will still do 900x more!!!
Veteran Traders:
- I hereby thank the market for providing this opportunity of selling more of my HODLs and giving me the benefit of being one of those who are respecting the market movements.
DIFFERENCES BETWEEN A NEW & VETERAN TRADER: CURRENT MARKET PRICE
There are times when the market deceives you into thinking that what you already have in mind whether it's already with a confirmation of 80% above or not, there is still a tendency for it to go opposite the expectations you have in mind.
In this scenario, we will identify how new traders and veteran traders formulate their trading plans, that is if they have plans.
Trader A and Trader B both wants to take advantage of the market movement and could possibly be thinking the same thing but with different courses of actions.
Trader A is thinking of doing max leverage for a short position today with 25%-100% of his total capital.
Trader B is patiently waiting for the price action of the market and until further confirmations appear, that will be the only time he'll take action. While having this in mind, he also have formulated the type of trading action he will make. He will open a long position on the possible retracement closest to the bottom of a token, use 5x leverage, 0.25%-2% from his total capital as his margin and setup stop loss, as well as target profit levels.
Who do you think is the new and veteran trader?
These posts are for educational purposes. To guide the people who might still be struggling within the crypto market, those who are new to the environment and volatility and everyone else who needs it.
Stay wise, trade cautiously.