In the cryptocurrency industry, following the market trend is the best way. Once the trend starts, it will pull you along like a locomotive. So, you have to learn to see whether the market is going up, down, or changing direction.
How do you know the market is rising?
To see the trend clearly, you have to look at the trend chart of a large time period, such as a day or a week. The fluctuations in a small time period are nothing but clouds, and ultimately they have to follow the general direction of the large time period.
An upward trend is when prices keep going up, with each new high being higher than the previous one, and so are the new lows. This is a clear upward trend.
When should you enter a trade?
The market cannot rise every day, there will always be a correction. At this time, the chart of a small time period can help you find a good time to enter the market. The chart of a large time period may still be slowly sorting out, but the chart of a small time period may have told you that the price has fallen a lot. For example, sometimes, the large chart looks like it is sorting out, but in fact the price has already fallen a lot.
When the price falls to a key position in the long time period, such as the previous high or low, that is a good time for you to take action. Your goal is to wait for the price to reach a new high.
How do you know the market is falling?
A downtrend is the opposite of an uptrend. The price keeps falling, and each new high is lower than the previous one, and the same is true for the new low. This is a downtrend.
How to judge that the market is going to fall?
The market can't go up or down forever, which is why many people lose money. Sometimes, you see the market going down, and then it suddenly goes up again. If you insist on shorting at this time, you will lose a lot. Similarly, if you see the market going up, and then it suddenly goes down again, and you insist on buying, you will also lose money.
So how do you judge that the market is going to fall?
In fact, the method is similar to judging the rise and fall. When the upward trend is broken and the price falls below the previous low, you have to change your view and wait for a new upward signal. Similarly, when the downward trend is broken and the price rises above the previous high, you also have to change your view.
Law.
Some people like to close their positions when the market turns, while others like to open positions in reverse. This depends on your own judgment.
To sum up, if the market goes up, you go up; if the market goes down, you go down; if the market goes down, you have to change. Only in this way can you become a profitable trader.
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