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To create a trading strategy - Investment period - Investment size - Trading method and profit realization method The above conditions must be taken into consideration.
As you proceed with trading, you will respond to price changes depending on the trading method and profit realization method among your trading strategies.
This usually results in a split transaction.
We must not forget that long-term holding means that we are seeing period losses due to long-term holding.
This is because profits from long-term holding are ultimately difficult to view as actual profits.
Additionally, while holding it for a long time, you miss out on the opportunity to earn greater profits by trading other coins (tokens), which reduces expected profits.
Therefore, when rapid price volatility occurs, a response is necessary.
This can reduce the psychological burden that comes with long-term possession.
If you purchased BTC below 29K, the current price movement is at a level that does not cause much pressure.
However, looking at the price volatility of altcoins due to BTC price fluctuations, you may feel psychological pressure.
This is because they feel psychological pressure to protect their current profits, so they worry about whether to proceed with a split transaction.
If you look at the movements of altcoins due to BTC price volatility from around November 2nd, when this volatility period began, to the present, you may think that there will be a big drop once.
If the average purchase price is below BTC 29K, but you are not yet familiar with creating a trading strategy based on chart analysis, it is recommended to proceed with split trading when volatility exceeds -10% to +10%.
When volatility exceeds -10% to +10%, it basically means the volatility of one candle on a 1D chart.
Accordingly, there was an opportunity to conduct a split transaction as recently as October 23rd.
To be sure that a volatility of -10% to +10% has occurred, the candle of the day must be closed.
Therefore, it is recommended to proceed with trading just before the day's candle closes.
However, since it has been continuously rising since October 23rd, I think there is a high possibility that if you sold it in installments, you are currently regretting it.
However, you can seize new opportunities and feel psychological stability with the cash you get from selling in installments.
Additionally, if the price falls by more than -10% in the future, additional purchases can be made.
Since the price is rising, it is thought that even if the price rises higher and falls by more than -10%, if you buy it at a higher price than the split sale price, you will ultimately incur a loss.
But, that's not the case.
The most important thing in trading is to make a big profit, but it is more important to have your own psychological stability.
So what is needed is a profit realization method.
What is not possible with traditional stock market trading methods is possible in the coin market.
The reason is that coins (tokens) can be traded in decimal units.
Therefore, if you trade by purchase price, split trading is possible even if the price rises.
For split transactions based on long-term holding, it is recommended to increase the number of coins (tokens) corresponding to the proceeds.
Therefore, when selling in installments, the number of coins (tokens) corresponding to the profit is reserved by selling the purchase principal amount corresponding to the purchase price (+ transaction fee x 2 included).
If trading is carried out in this way, the average unit price provided by the exchange becomes meaningless.
Therefore, if you continue trading in this way, all of the purchase principal will be recovered, and only the number of coins (tokens) corresponding to the profit will remain.
Therefore, once the entire purchase principal has been recovered, the average purchase price of the remaining coins (tokens) becomes 0.
In this situation, even if you proceed with the transaction again, the average purchase price will be lower than the purchase price, thereby reducing the psychological burden of purchasing.
The impact of these transactions has greater significance when investing with a long-term perspective.
If so, let's give an example of how to proceed with additional purchases.
The method mentioned above, i.e. split trading when volatility is more than -10% to +10%, is a good method to use for those who are not familiar with chart analysis or creating trading strategies.
(Basically, you need the know-how to determine whether you are supported or resisted at a support or resistance point or section.
It is a tedious and difficult task as it requires checking movement for at least 1 to 3 days to check whether support or resistance is received at the support and resistance points.)
1. You can proceed with split trading based on the 5EMA on the 1D chart.
The 5EMA on the 1D chart has long been called a rising line.
Therefore, in order to proceed with a breakout trade, it is recommended to proceed when the price rises above 5EMA.
When the price rises sharply and falls away from the 5EMA, it touches the 5EMA line again and appears to be supported, so a split purchase is possible.
Therefore, split purchases are possible in section 1.
Accordingly, you will have to worry about how much of a purchase proportion you should make when purchasing.
When buying around 5EMA, it is recommended to buy about one-third to one-fourth of your current holdings. (If you purchase in proportion to the number of coins (tokens) held, the average purchase price will increase significantly, so it must be calculated based on the current amount held.)
If you purchase more than that, you may feel psychologically anxious if the average purchase price shown increases significantly, so you need to be careful.
2. When support is confirmed near the MS-Signal indicator on the 1D chart (26EMA, which shows similar movements), you can proceed with split trading.
The next section for additional purchases is possible when support appears near the MS-Signal indicator.
At this time, you can purchase with 50% to 100% of the amount held.
The reason is that there is a high possibility of creating a pull back pattern.
3. Split trading is possible depending on whether support or resistance is received around the HA-Low and HA-High indicators.
If it is supported by the HA-Low indicator, it is basically a good time to buy additional money because it is highly likely to touch the HA-High indicator.
However, if supported by the HA-High indicator, there is a possibility of renewing the previous high point, so this also corresponds to the time for additional purchases.
Don't do it. If the HA-High indicator falls, it is highly likely that it will touch the HA-Low indicator, so a countermeasure is essential.
If the HA-Low indicator falls, there is a possibility that the previous low point will be renewed, so a response plan is also needed.
However, if it falls below the HA-Low indicator, there is a possibility of forming a bottom, so depending on the overall position of the price, you may have a better opportunity.
Rather than analyzing charts, it is more important to think about these trivial(?) trading strategies and create a method that suits you.
This trading strategy does not necessarily require good chart analysis.
Therefore, in order to proceed with a transaction, you must have an idea of these minor(?) details.
Therefore, you should spend more time creating your trading strategy than you spend analyzing charts.
A trading strategy requires you to create a big picture trading strategy before you start trading.
In addition, by creating a detailed trading strategy within the scope of the trading strategy in the big picture and proceeding with the transaction while feeling psychologically stable, even if the transaction fails, the impact on proceeding with the next transaction can be reduced.
The most important thing in chart analysis is to have the know-how to check whether you are supported or resisted at support and resistance points or sections.
I do not recommend analyzing charts beyond that because it means becoming an analyst rather than trading.
Therefore, rather than studying difficult chart analysis techniques, more time should be invested in checking whether support or resistance is received at support and resistance points or sections.
** All explanations are for reference only and do not guarantee profit or loss in investment.
** Trading volume is displayed as a candle body based on 10EMA. How to display (in order from darkest to darkest) More than 3 times the trading volume of 10EMA > 2.5 times > 2.0 times > 1.25 times > Trading volume below 10EMA
** Even if you know other people’s know-how, it takes a considerable amount of time to make it your own.
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