đLearn all about the reversal strategy?
In trading, what goes up fast usually goes back down just as fast â a concept known as mean reversion. The idea is simple: after a sudden surge, prices usually return to their average. By identifying the top gaining coins that rose quickly, we can anticipate when their price might fall and profit from the correction.
Step-by-step guide to shorting a top gaining coin:
đ Step 1: Find a top gaining coin
Start by scanning the market for coins with substantial short-term gains. On Binance, you can check out the âTop Gainersâ section. Focus on coins that have risen by 15% or more in the past 1-2 hours. These top gaining coins are often overbought, making them prime candidates for a reversal.
đ Step 2: Switch to the 5-Minute Time Frame (TF)
To accurately spot potential reversals, switch to a 5-minute TF chart. This time frame offers a clearer view of short-term price movements and makes it easier to identify resistance levels.
đ Step 3: Identify Resistance Levels
A resistance level is where the price of the currency struggles to rise. Look for areas where the price has repeatedly tested the price but failed to break through. These resistance points indicate where buying momentum fades and selling pressure increases.
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