Before enter in my trades read it đ
DCA- Dollar Cost Average.
This is extremely important when entering a position. You do NOT want to deploy 100% of your capital when you first enter a trade. YOU DO NOT want to do this especially if you are trading in the futures market. The crypto market works extremely fast. The futures market moves incredibly fast especially if you are using high leverage. ( I do not recommend traders using more than 5x to leverage unless you are expierenced)
When entering a position for the first time. Letâs say I had $1,000 allocated to open a new position in a future trade.
My first entry will always be anywhere from 5-15% of my capital.
So now, I have decided I wanted to hop into a trade. I want to buy coin X:
I buy coin X at $.2000 with 10% of my capital. 100$ initial investment in the trade. After a few seconds it drops a bit down to $.1900. My position is negative but I have faith this trade will see a reversal. I deploy another 15% of my capital. Boom now we have used 25% of our capital and our average entry priced has now dropped from $.2 to $.1940. Now we wait, to see what happens. What direction the trade moves in. Say, the coin has pulled back a bit more to even $1850 you deploy another 15% your average buy in price has decreased even more. Next thing you know the coin has bounced back and your riding it into deep profits as it breaks above $.2 again.
I hope this breakdown on how entering a position will help you guys. It will make you guys feels lot less stressed when entering a position. It gives you a little bit of margin to make a error. Not every trade is going to be a win right away or at all. But doing this method has helped me stop worrying about panicking right away when entering a position. Dollar cost average is definitely the way to go. Hope this helps.