Emphasizing the distinction between a novice and an experienced trader
BUY/SELL DECISION MAKING SCENARIO #1
Fresh Traders:
Given that it appears to be about to rise higher and that I can wager with a 500% gain with this 50x leverage, I can purchase at this level.
Experienced Traders:
Since the main resistances have just been broken and there is a chance of more shakeouts, which increases the likelihood of retracements and rejections, I can take on more short positions at this level. On this one, I'll undoubtedly employ 5x leverage with a margin of between 0.25% and 2%, place a stop loss around this invalidation, and take profit using the goals I've established.
SCENARIO #2: FORUM
Fresh Traders:
I really believe that this token will continue to rise to this significant level, and I assume that you all share my belief.
Experienced Traders:
Since additional buyers will join the rally as a result of this price explosion, we can confidently predict that there may be reversals. With prudent leverage and margin allocations, we can join the reversal rather than the rally.
SCENARIO #3: Gratitude
Fresh Traders:
Boom, boom, and boom! I'm hoping that this token will continue to do 900x more!
Experienced Traders:
I would like to express my gratitude to the market for giving me the chance to sell more of my holdings and for allowing me to be among those who respect market movements.
Disparities in the current market price between a novice and an experienced trader
The market has a propensity to go against your expectations, even if you have a confirmation of 80% beyond your initial estimates. At times, it might trick you into believing that this is the case.
In this case, we will determine how novice and seasoned traders create their trading strategies, assuming they have any.
Although they may have distinct strategies, traders A and B may be thinking the same thing and both wish to profit from market movement.
Trader A is considering using 25%–100% of his total capital as maximum leverage for a short trade today.
The market's price activity is what Trader B is anxiously awaiting, and he won't act until additional confirmations show up. He has also developed the kind of trading activity he will take while keeping this in mind. He will employ 5x leverage, set a stop loss and target profit levels, and open a long trade on the potential retracement that is closest to the bottom of a token. His margin will be between 0.25% and 2% of his total capital.
Who do you believe to be the experienced and novice 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.