TRADING WITH THE TRENDIdentifying the trend and trading with it is vital to your success as a crypto trader.
The crypto market can be an emotionally charged place and,
when traders start pushing the price of a coin in one direction or another,
other traders typically start to follow suit and push the price of the coin in
the same direction. When you see increasing momentum building behind
a moving coin, the chances are good that the coin will continue moving
in that direction. At that point you increase your odds of making money by
trading with the trend. Fighting the trend generally turns out to be a losing
proposition.
Trends tell you where prices will most likely be going in the future. If
traders are pushing the coin price higher you ought to buy the coin to make money.
If traders are pushing the coin price lower, you
ought to sell the coin to make money. If traders in disagreement
over where the coin price should go and are pushing the coin price
sideways, you ought either to alternate between buying and selling the
coin or wait until the trend is clearly up or down to make money.
PAYING ATTENTION TO SUPPORT AND RESISTANCE
Support and resistance levels are like the ends of an Olympic swimming
pool. Just as the ends of the pool tell swimmers when it is time to turn
around and start swimming in the opposite direction, support and
resistance levels tell you if the price of a coin is likely to stop, to
turn around, and to start moving in the opposite direction in the future.
Knowing where a coin may stop and turn around helps you to
enter and exit your investments at the most profitable times.
