The price of bitcoin (and other cyptocurrencies) is surging, specially in the last months which it’s been constantly reaching historical highs making it a very interesting instrument to monitor…
But is it really the time to start trading it?
Read on to see what I think about this…
Bitcoin, cyptocurrencies, Ethereum
It all comes to the reasons why to take your trades…
It needs to be a sound reason, you need to have a methodology so you can determine what risks to take and which ones to avoid…
You cant take a trade because:
- You simply thought the market was going up
- You followed some one else’s advice
- You got influenced by a market analyst
- You saw the oil price moving up, etc
The idea is to get in a trade when the odds are on your favor, when the likelihood of the market of moving in one direction over the other is greater, when you’ve got a either, a very good profit potential or a good accuracy factor…
You see what I’m getting at?
So here is the reason why I decided to trade the EURUSD…
breakout, EURUSD, strategy
If you been trading for a while you know that divergences are…
A divergence occurs when the market doesn’t behave in the same way oscillators do.
Let say the market makes a higher high (or a lower low), but the oscillator (RSI, CCI, Stochastics, etc) fails to make a similar high (or low)… that’s a divergence.
The idea is that, since the indicator doesn’t agree with the market, “something” might happen, like a major reversal, consolidation period, etc.
So here is what I think…
divergence, divergence trading, oscillators, technical indicators
Markets change Traders, that’s a fact.
The way the markets traded 15 years ago is definitely different from the way it is currently trading. If you found a system that worked 15 years ago, I assure you that it wont work today, that simple.
The only way you can survive is by Adapting to the Market Conditions, there is just no other way.
And the same happens with fundamental releases…
Fundamental, fundamental announcements
I’m a firm believer that 90% of your trades depend on your previous analysis and only 10% on your actual entry.
You can have the best entry system in the world, but if you take your trade in the wrong direction, or trade the wrong instrument, then you are doomed!
In fact, I think it doesn’t really matter what entry system you use, as long as you are trading the right instruments.
So here is how I got those 687 pips…
breakout, false breakouts, GBPNZD
The idea of having a formula that will magically predict the end of a correction period (Fibonacci retracements) sounds awesome.
Sounds like a tool everyone would like to use (including myself)…
But, does it really work?
Fibonacci, Fibonacci Retracements
In the last couple of days the market has been very very slow. If you try to find trend trades you are going to get burned…
The thing is, as always, you need to adapt to the market conditions.
The key is to find currency pairs (or any other instrument) with a clear range. Once you find it, pay special attention to the the market reacts at both extremes of the range.
Adapt, market condition, range