Development of unstable markets trading strategy: Cryptographic Trade Manager
The world of cryptocurrency trading has become increasingly popular in recent years, with decentralized scholarships (DEX), margins trading platforms and other innovative measures. However, as in any investment strategy, the risk is related to. One of the biggest challenges is to browse the volatile markets that can quickly change loss profits.
In this article, we will discuss how to create a trade cryptocurrency trading strategy in volatile markets. We will examine the basic principles, risk management methods and strategies to mitigate the risks associated with high variability markets.
Understand volatile markets
Before developing an unstable market trade strategy, it is necessary to understand what makes them so volatile. The volatile markets are typical:
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- Liquidity limited : Trade volumes can be low, making it difficult to introduce or leave surgery quickly.
- Loss risk : Large variability markets often cause greater potential losses.
Basic principles in developing a trading strategy in a volatile market
When developing a trade strategy for trade in cryptocurrency trade markets, remember the following basic principles:
- Diversification : Divide your investment through several cryptocurrency and asset classes to reduce risk.
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- Trend to follow : Look for price trends, but be aware that even the strongest trends can take place quickly.
Risk Management Methods
To mitigate the risks associated with high variability markets, consider the following risk management methods:
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- Leakage arrest : Use leakage stops to adjust the Stop-Loss team when prices are moving in your favor, which restricts potential losses.
- Lever Management : Consider using a lever effect (such as 2x or 3x) to increase the benefits but be aware of increased risk.
After the trend sequence
Focus on the determination and execution of cryptocurrency prices for trend monitoring strategies:
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- Focus on long -term trends : Although this trend can be effective in a short period of time, focus on longer trends (such as 6-12 months).
- Knowing the sense of the market
: Observe the sense of the market and adjust your strategy accordingly.
Example of Trade Strategy
Here is an example of an unstable markets trading strategy:
- Define the position size by risk management methods (for example, 2% of the account value).
- Choose a cryptocurrency with a strong tendency for your benefit.
- Set the main levels of support and resistance using technical indicators.
- Enter the trade in the Stop-Loss team lower than the entry price, the fixed percentage, less than the input price.
- Adjust Stop-Loss team as prices develop in your favor.
Conclusion
In order to develop a commercial strategy for unstable cryptocurrency trade markets, the basic principles and risk management methods must be carefully examined.