The market fluctuates and adjusts, 4 tips for playing Meme🚀🚀🔥

Risks when going up, opportunities when going down.

Although the Meme sector continues to set new highs, blindly following the trend can easily lead to danger.

Before trading Meme, the following four key tips are worth your detailed understanding:

1. Price action is king

Since Meme is an attention-driven economy, price action (PA) and trading volume play a key role in continuous price discovery.

High-quality Meme should have a history of high trading volume and high number of transactions to prove its real attention.

2. Use support and resistance levels to enter the market

No matter what asset you trade, it is crucial to be familiar with support and resistance levels. Meme prices cannot rise forever, so finding the right entry point, such as the flip of support and resistance levels, will help you better grasp trading opportunities.

3. Reasonable control of position size

Position size is crucial to the success of a trading strategy. I usually determine the position size based on the market value of the project.

For meme projects, I prefer to invest 1 ETH in projects with a market cap of about 1M and limit the total position to 2-3 ETH (depending on liquidity).

If the position in a large-cap project is too small, it may take a long time to wait for profit, thereby increasing the overall risk.

4. Pay attention to the liquidity-market cap ratio

Liquidity determines the amount that can actually be withdrawn from an asset. Since liquidity providers (LPs) usually account for half of each asset, the amount that can actually be withdrawn from the pool may be much smaller than the market cap shows.

Small liquidity pools tend to lead to higher volatility.

Therefore, when investing in small liquidity pools, be wary of possible losses caused by price impacts. $MEME $BTC $ETH

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