Avoid Buying at Round Numbers
This post might get a bit technical, but it's essential for understanding market behavior. Take your time to read and re-read it if necessary.
Many traders use "Limit" orders to buy or sell cryptocurrencies. For those unfamiliar, a Limit order allows you to automatically execute a trade at a specific price. For example, if you want to sell 1 $BTC at $68,500, you place a Limit sell order at $68,500, and it will automatically execute when the price hits that level.
However, you should avoid placing Limit orders at round numbers like $70,000, $75,000, or even $75,500. These round numbers are key psychological levels where many traders place their orders. As a result, your order can get lost among thousands of others, requiring a significant amount of capital to fulfill.
For example, if 1,000 $BTC are for sale at $70,000, it means 1,000 BTC need to be bought to fill all those orders. The likelihood of having 1,000 BTC available at that level is low. Instead, if you place your order at $69,999, you avoid the congestion at the round number, increasing the chances of your order being filled.
This strategy applies to all cryptocurrencies and any round numbers. If you have questions, feel free to ask in the comments.
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