Save your money and nerves by not trading at the wrong time. While understanding the best time to enter your trades is very important, knowing when to step away from trading is just as important.
There are two main characteristics of bad timing:
Low market activity
Irregular direction of trades
Low activity: An inactive market (often called âlightâ) offers smaller price movements and therefore smaller potential profits. Due to lower liquidity, a light market also comes with higher commissions (spreads) per trade. In simple words: If you want to sell a coin in a light market, it is difficult to find potential buyers, so the commission goes up
Chaotic Markets: A good example of chaotic trading is around and during important news events. In these times of uncertainty, currency prices can swing wildly and unpredictably, disrupting trading by creating execution delays, triggering stop-loss orders, etc.
So, here are some examples of when you should at least be careful when trading:
$BTC There are some things you should take into consideration when trading currencies.?
1. Knowledge and learning: Before you start trading, you must understand the concept of digital currencies and learn how the market works and technical analysis.
2. Technical analysis: Your strategy must rely on technical analysis of digital currencies, by studying charts and technical indicators to make the right decisions.
3. Capital Management: You should determine a specific amount of money that you are preparing to invest in trading, and maintain good capital management to avoid losing all your money.
4. Diversification: It is best to diversify your investments in digital currencies, in order to reduce risks and increase profit opportunities.
5. Patience and discipline: You must be patient and committed to your chosen strategy, and not deviate from it based on emotions.
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