How to use price orientation in its cryptocurrency trade strategy
As a cryptocurrency merchant, he is constantly looking for ways to obtain an advantage over the market. A popular approach is the use of price orientation, which implies identifying key levels of support and resistance that can help guide their commercial decisions. In this article, we will explore how to use the price orientation in its cryptocurrency trade strategy.
What is the orientation price?
The price price is a technical analysis method that implies identifying specific price levels, such as ups and downs, minimums and outbreaks, and using them to determine the next level of movement for a particular asset. By establishing objective prices based on historical data or the feeling of the market, you can create a framework for your commercial decisions.
Objective Price benefits in cryptocurrency trade
The price price offers several benefits, which include:
- Increased trust : With the orientation of the price, you can feel safer that your operations will work as expected.
- Reduced risk
: By identifying key levels of support and resistance, it can reduce the probability of losing money due to unexpected price movements.
- Improved commercial efficiency : Price orientation helps you identify opportunities and eliminate unnecessary positions.
How to use price orientation in its cryptocurrency trade strategy
Here are some steps to follow when using the price of the cryptocurrency trade strategy:
- Choose a time frame : Select a specific time frame, such as 4 -hour graphics, 1 day or weekly, to analyze and the target levels.
- Identify key levels of support and resistance : Look for historical data that shows the price level where the asset has previously reversed the address. These are known as levels of support and resistance.
- Establish target prices : According to your analysis, establish the objective prices based on the level of support or resistance that you have identified. For example, if you go to a $ 50 support level, it means that you want to buy at $ 49.99 and sell at $ 50.99.
- Use technical indicators : Use technical indicators such as mobile averages, RSI (relative force index) and Bollinger bands to confirm its target prices.
- Adjust your strategy : As the market changes, adjust its objective prices accordingly.
Examples of target price in cryptocurrency trade
Here are some target price examples in cryptocurrency trade:
- Bitcoin (BTC)
: Identify support levels around $ 8,000 and resistance levels around $ 10,500.
- Ethereum (ETH) : Identify resistance levels around $ 400 and support levels around $ 350.
- Litecoin (LTC) : Identify support levels around $ 60 and resistance levels around $ 80.
Common mistakes to avoid
While price orientation can be a powerful tool in cryptocurrency trade, there are some common mistakes to avoid:
- Overalting : Establish the objective prices that are too high or low can lead to incorrect operations.
- ignoring the feeling of the market : Do not consider the feeling and emotions of the market when establishing objective prices can lead to a bad decision making.
- Do not monitor the graph : Do not regularly verify the graph for new levels of support and resistance can lead to lost opportunities.
Conclusion
Price orientation is a valuable tool in cryptocurrency trade that can help you gain confidence, reduce risk and improve commercial efficiency. Following these steps and avoiding common errors, you can use the price price to make more informed decisions and achieve your commercial objectives. Remember to stay flexible and adapt to changing market conditions as new levels of support and resistance arise.
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