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Fundamental Analysis

Smart Money Orderflow M15 ApproachIn this context, we define an intelligent order flow, which is a convergence of flows, in this case, downwards, leading the price to create congestions, i.e., internal breaks, and then consolidation phases, i.e., external breaks, which bring the price into the demand zone, where we should consider opening a long position subsequently. The pattern is clear: demand zone on H4 after a defined structural change with the main consolidation phase, and then we expect a retest in the demand zone, where it is highly likely that the price may reverse its direction, especially when analyzing the market from an M15 perspective. I remain available for further clarifications, greetings, and happy studying to all.
Education
by EdgeTradingJourney
1
Mitigation + BOS M15 Setup In this scenario, we examine a very common approach: trend continuation. The particular aspect of viewing it in this light compared to simply looking at trendlines is how we can identify demand zones and structural changes called BOS. Prices always tend to retrace in these zones before continuing. Personally, I identify demand or supply zones at H4, and once the price retraces, I look for rebounds at M15. In that timeframe, I aim to identify a structural change to the upside if I'm looking for a long position. Sometimes during an uptrend, it's very common to identify inefficiencies or FVG, which in turn support the price during retracement. Best wishes and happy trading to all.
Education
by EdgeTradingJourney
1
Setups, Planning and RISK: How to MANAGE your RISK vs REWARD📉Hi Traders, Investors and Speculators of Charts📈 For today's post, we're diving into the concept " Risk-Reward Ratio " We'll take a look at practical examples and including other relevant scenarios of managing your risk. What is considered a good risk to reward ratio and where can you see it ? This applies to all markets, and during these volatile times it is an excellent idea to take a good look at your strategy and refine your risk management. Let's jump right in ! You've all noticed the really helpful tool " long setup " or " short setup " on the left-hand column. This clearly identifies the area of profit (in green), the area for a stop-loss (in red) and your entry (the borderline). It also shows the percentage of your increases or decreases at the top and bottom. It looks like this : 💭Something to remember; It is entirely up to you where you decided to take profit and where you decide to put your stop loss. The IDEAL anticipated targets are given, but the price may not necessarily reach these points. You have that entire zone to choose from and you can even have two or three take profits points in a position. Now, what is the Risk Reward Ratio expressed in the center as a number.number ? The risk to reward ration is exactly as the word says : The amount you risk for the amount you could potentially gain. NOTE that your risk is indefinite , but your gains are not guaranteed . The risk/reward ratio measures the difference between the entry point to a stop-loss and a sell or take-profit point. Comparing these two provides the ratio of profit to loss, or reward to risk. For example, if you're a gambler and you've played roulette, you know that the only way to win 10 chips is to risk 5 chips. Your risk here is expressed as 5:10 or 5.10 .You can spread these 5 chips out any way you like, but the goal of the risk is for a reward that is bigger than your initial investment. However, you could also lose your 5 and this will mean that you need to risk double as much in your next play to make up for your loss. Trading is no different, (except there is method to the madness other than sheer luck...) Most market strategists and speculators agree that the ideal risk/reward ratio for their investments should not be less than 1:3 , or three units of expected return for every one unit of additional risk. Take a look at this example: Here, you're risking the same amount that you could potentially gain. The Risk Reward ratio is 1, assuming you follow the exact prices for entry, TP and SL. Can you see why this is not an ideal setup? If your risk/reward ratio is 1, it means you might as well not participate in the trade since your reward is the same as your risk. This is not an ideal trade setup. An ideal trade setup is a scenario where you can AT LEAST win 3x as much as what you are risking. For example: Note that here, my ratio is now the ideal 2.59 (rounded off to 2.6 and then simplified it becomes 1:3). If you're wondering how I got to 1:3, I just divided 2.6 by 2, giving me 1 and 3. Another way to express this visually: In the first chart example I have a really large increase for the long position and you can't easily simplify 7.21 so; here's a visual to break down what that looks like: If you are setting up your own trade, you can decide at what point you feel comfortable to set your stop loss. For example, you may feel that if the price drops by more than 10%, that's where you'll exit and try another trade. Or, you could decide that you'll take the odds and set your stop loss so that it only triggers if the price drops by 15%. The latter will naturally mean you are trading at higher risk because your risk of losing is much more. Seasoned analysts agree that you shouldn't have a value smaller than 5% for your stop loss, because this type of price action occurs often during a day. For crypto, I would say 10% because we all know that crypto markets are much more volatile than stock markets and even more so than commodity markets like Gold and Silver, which are the most stable. Remember that your Risk/Reward ratio forms an important part of your trading strategy , which is only one of the steps in your risk management program. Dollar cost averaging is another helpfull way to further manage your risk. There are many more things to consider when thinking about risk management, but we'll dive into those in another post. A little bit more in-depth explanation on Dollar-Cost-Averaging here: And Finally, the last tool I'll give away today is an absolute MUST for all traders . Here's how to successfully set-up your own portfolio ratios: If you found this content helpful, please remember to hit like and subscribe and never miss a moment in the markets. _______________________ 📢Follow us here on TradingView for daily updates📢 👍Hit like & Follow 👍 CryptoCheck
Education
by CryptoCheck-
Unveiling the Golden Opportunity: Why XAUUSD/Gold is My FavoriteJoin me on an immersive journey as I delve into the unparalleled allure of trading XAUUSD/Gold. In this comprehensive exploration, I'll unravel the intricacies of trading gold, from its status as a timeless safe-haven asset to its remarkable resilience in the face of market volatility. Delve deeper into the historical significance of gold, its correlation with global economic trends, and the unique opportunities it presents to traders. Through expert analysis and insightful commentary, I'll showcase why XAUUSD/Gold remains my preferred pair for unlocking consistent profits and navigating the ever-evolving landscape of financial markets. Buckle up and discover the golden secrets to trading success with me.
PEPPERSTONE:XAUUSDEducation
by ControllaFX
Pullback After Breakout Entry M15 ApproachIn this model, we define an approach that I personally use a lot, namely the creation of a demand or supply zone on the H4. In this case, we are observing a demand zone. Once the zone has been plotted on the chart, we wait for a retracement on the M15, and as soon as the market shows a structural change, in this case to the upside during the three London, pre-NY, and NY sessions, always considering to have the midnight open behind us, we can enter the market. The target will be the nearest swing high level, always considering to have at least a risk/reward ratio of 1.5. Best regards and have a good day everyone.
Education
by EdgeTradingJourney
2
5 Important Trading Protection LevelsREMEMBER No matter what stock, index, Forex or other markets you’re trading, every trader needs 5 protection levels. Stop loss to stop yourself from furthering losses Time stop loss to get you out of non-performing trades Adjusted stop loss to lock in profits when the market moves in your favour. Risk % per trade to only lose a certain amount of your portfolio % of Drawdown before you HALT trading – when the market is not in a favourable environment to your strategy. Short and sweet but VERY powerful to apply to your trading. Do you have any other protection levels?
TVC:SA40Education
by Timonrosso
1
Markets are dynamic journeys, not linear sprints.The market's dance is a complex waltz, not a straight-line dash. Ideas, fueled by innovation and market forces, often blossom slowly, requiring patience and a keen understanding of different timeframes. While the allure of catching the exact bottom or selling at the precise peak might be tempting, it's important to remember: Long-term vision prevails: Your investment journey should be guided by a well-defined plan, one that considers your individual goals, risk tolerance, and the fundamental strengths and potential growth paths of the assets you choose. Don't fall prey to short-term fluctuations or the fear of missing out (FOMO). Timeframe is your compass: Day traders dance to the rhythm of minutes, while value investors follow the melody of years. Each strategy has its place, but aligning your approach with the timeframe it's suited for is crucial. Imagine trying to analyze a company's long-term prospects based on hourly price movements – it's simply not the right tool for the job. Reality over rainbows: Remember, markets are inherently volatile, and expecting guaranteed outcomes is like chasing a pot of gold at the end of a rainbow. Instead, focus on making informed decisions based on sound research, risk management strategies, and a realistic understanding of potential returns and setbacks. Long-term (Years): 2011: Imagine buying Bitcoin at around $1 in 2011 when it was still a nascent technology. While there were many ups and downs in the years that followed, holding onto it through various market cycles would have resulted in significant returns despite not catching the exact bottom. This exemplifies a long-term investment strategy based on believing in the potential of the technology. 2021: Even if you bought Bitcoin near its all-time high of $69,000 in November 2021, with a long-term perspective and a belief in its potential future adoption and value, there's a chance it could still generate returns over the years, provided the underlying technology and adoption continue to grow. This emphasizes the importance of considering your investment horizon and risk tolerance. Mid-term (Months): 2023: In June 2023, Bitcoin dipped below $20,000. A swing trader might attempt to "buy the dip" based on technical analysis suggesting a potential trend reversal and hold for a few months in anticipation of a price increase before selling. This highlights the use of technical analysis and shorter-term strategies, but still within a broader context of understanding overall market trends and risk management. Short-term (Days/Hours): Scalping: A day trader might try to capitalize on intraday price fluctuations in Bitcoin within minutes or hours, using technical analysis to identify quick entry and exit points. This showcases a highly active and risk-intensive strategy requiring advanced knowledge and skill, not suitable for everyone. Key takeaway: These examples illustrate how different timeframes require different approaches and risk tolerances. It's essential to choose a strategy aligned with your goals, knowledge, and risk tolerance. Remember, even within timeframes, there are no guarantees, and past performance is not necessarily indicative of future results.
CRYPTOCAP:BTC.DEducation
by ParabolicP
DECODING GANN FAN: HOW TO USE IT IN TRADING👋 Hello, Forex traders! In this post we are going to talk about Gann angles, which many of you know as the Gann Fan. Essentially, they are the same thing. We will learn how to build these angles, what are their essence, and most importantly - how we can apply Gann's Fan in practice in our trading. What Are Gunn Angles ? 📢 Gann Angles, or Gann Fan, is one of the standard tools present by default in TradingView. The Gann fan indicator includes a sequence of straight lines drawn at different angles with the base at the pivot point. The resulting picture resembles a fan, from which the name of the tool was derived. Each of these lines indicates possible support or resistance levels as the price approaches it. William Gunn notes that his indicator cannot 100% predict and that the market always will change the trend direction. It only shows the moments when there is the highest probability of market reversal or consolidation. Widespread use of Gann angles as part of analytical work in the market is one of the most popular and, at the same time, complex methods of technical analysis. Nevertheless, the skills of structural assessment and forecasting of currency market dynamics, based on the theory of William Gunn's angles are in demand in the tools in the arsenal of every professional trader. It is worth mentioning that Gann angles are often confused with trend lines, which is not true, despite the characteristic similarity. The key difference between the Gann line and the trend line is that the Gann line is characterized by dynamic features that allow it to move both along the x-axis (vertical axis) and y-axis (horizontal axis), which opens up wider functionality for the trader. For example, it is possible to analyze an asset by plotting it in charts, which makes it possible to determine the angles of fluctuations of a market instrument and, subsequently, to mark the limits of its dynamics. The key assumptions of market dynamics, within the framework of the Gann theory, are the following: • Price, time and range of market fluctuations; • Geometric structure of the currency market, the analysis of which allows to predict the factors of further formation of its dynamics; • The fundamentally cyclical nature of market dynamics. Gann compared the nature of the market with the nature of human beings, analyzing the past and present of which, one can make a series of essential conclusions regarding its future. Gann Fan In Forex Trading 📊 Now it's time to tell you how Gann angles are applied in practice. The peculiarity of applying Gann's theory in practice is to focus on two, classic for his theory, models, designed to help the trader in predicting market movements: • The research time model, which implies fixing cyclically repeating dates; • The price range model, which includes support and resistance lines, as well as pivot points. Since such techniques require deep knowledge and experience from a trader, let us note the most essential technical aspects that should be kept in mind first of all. A trader should decide on the models that she/he will use when analyzing the market with the help of Gann fan. The most common of them are models 1, 1×2 and 2x1, each of which implies a certain slope of the lines. However, there are many more among these models and, accordingly, angles: 1 × 1 - 45 degrees 1 × 2 - 63.75 degrees 1 × 3 - 71.25 degrees 1 × 4 - 75 degrees 1 × 8 - 82.5 degrees 2 × 1 - 26.25 degrees 4 × 1 - 15 degrees 8 × 1 - 1.5 degrees There is nothing complicated about these parameters: the first one corresponds to a unit of time, the second one to a unit of price, and the formula, accordingly, shows the relation between price and time interval. Of particular note is the 45 degree model, also known as 1×1. According to Gann, the 1×1 line represents the long-term trend line: up or down. In this model, the disposition of price above the ascending line indicates a bullish trend and below the descending line a bearish trend respectively. The disposition of the price crossing the line indicates an anticipated trend reversal. It is important to emphasize that the 1:1 line represents the balance between price and time ranges. It is not uncommon in the market that when price approaches the line, time and price are balanced. How To Draw Gann Angles On A Chart? 📈📉 Let's try to apply the Gann Fan in practice. Gann angles are drawn from the top of the trend. In this case, it is the lowest point. We draw a line 1x1 at an angle of 45 degrees. How to determine the angle of 45 degrees? Very simple. You can use the Trend Angle insturment to calculate 45 degrees. Under this line you will immediately begin to touch the trend. It is almost impossible to make a mistake with the construction of the angle. All other lines are pulled up automatically. Note! Once built, this fan has a large number of points of touch and points of touch with the trend in the future. In other words, these angles can be used as an additional tool for technical analysis in the form of support and resistance levels. We strongly do not recommend trading using only one of these tools. Also, the Gann theory has a number of similarities with fan lines based on Fibo coefficients. In light of the market moving up or down, the angles transform within the existing trend, forming resistance and support levels. As you may have already realized, this tool is not associated with any specific trading strategies, but it can serve as a good additional tool to identify support/resistance levels as well as trend reversal points. Another key is to look for time and price discrepancies. Price will always tend towards the mean line. In summary, Gann angles, also known as the Gann Fan, can be found on TradingView and are a standard tool frequently utilized by Forex traders. They are comprised of a sequence of straight lines that derive from a pivot point and form a shape resembling a fan. Each line indicates potential support or resistance levels as the price approaches them. Gann angles are not deterministic, and their purpose is to show when there's a high probability of market reversal or consolidation. Traders, If you liked this educational post🎓, give it a boost 🚀 and drop a comment
Education
by Lingrid
12
Types of Orders in Forex Trading. Everything You Need to Know Hey traders, In this post, we will discuss types of orders that we use in Forex trading. ➖ Market order. Trading position is opened at a current price level. Buying the asset, you will open a trading position at a current ask price. Selling the asset, you will open a trading position at a current bid price. Even though market order is the most preferable type of orders among newbie traders, I highly recommend not to use that, especially if you are a day trader. ❗️The main problem is that prices constantly fluctuate and there is a certain delay between order execution and position opening. For these reasons, the position will be opened from a random price level within the range where the market is currently staying, affecting a risk to reward ratio. ➖ Limit order. Trading position will be opened only from a desired price level. With buy limit , you will buy the asset from a certain level. (current price remains above the order) With buy stop order, you will buy the asset from a certain level. (current price remains below the order) With sell limit, you will sell the asset from a certain level. (current price remains below the order) With sell stop , you will sell the asset from a certain level. (current price remains above the order) I prefer to trade with limit orders. Limit order helps you to trade from a desirable level, automatically executing the order once it is reached, letting you preliminary set it. ❗️However, remember that there is one big disadvantage of that order type: there is no guarantee that the price will reach the desired price level to activate a trading position. For that reason, occasionally you will miss the trades. Setting a sell limit order on Gold on 2049 level, the trade would be missed because the price respected 2048 level and dropped immediately then. Try these order types on a demo account to learn how they work in practice. Which order type do you prefer?
OANDA:XAUUSDEducation
by VasilyTrader
3
Are we in LAZY FEBRUARY traders? Q. "I heard that there is a phenomena called “Lazy February”. Could you explain why it’s called that and what I should watch out for as a trader?” A. I have not heard that term in eons! Here’s my 10 cents on how Lazy February got this name. Short month effect February is the shortest month of the year. And because so much happens in February, many investors like to play it safe and observe. Most investors tend to wait for March when the markets have chosen a direction, earnings are out, taxes are paid and they are ready to invest again. Year-end position squaring Traders often close out their positions at the end of the year right through to January. And this is for accounting, performance evaluation and tax purposes. This process is known as "position squaring”. But the big influencer is tax. Closing off the tax year In many countries, February is a time when individuals and corporations start preparing for tax filings. And this can influence investment decisions which can lead to either selling their positions or adjusting their portfolios for tax efficiency. After February and going into March, we should see a higher volume of buying and investing in the markets. Earnings season February is also known for major earnings releases – Especially in the U.S. Investors during this period prefer to watch and observe. This way they’ll be able to see the forecasts versus the actual results. Once the numbers are released, that’s where they’ll have more of an idea of what they want to invest in and what to buy or sell in March and the coming year.
TVC:SA40Education
by Timonrosso
1
Q. WILL A 125BPS CUT IN INTEREST RATES DRIVE UP GOLD? A. Remember when it comes to interest rate cuts it means the following: Stimulates economic growth This makes borrowing cheaper as interest rates are lower. And it encourages more spending and investments by individuals and businesses. Boosts buying from consumers Also, with low interest rates it entices people to buy more. And this is because the cost of loans drops. This leads to them buying more homes, cars, and other goods. There are other elements, but you get the idea. Now, lets consider why lower interest rates could mean the gold price will rally Reason #1: Lower interest rates and a weaker US dollar helps the gold price When interest rates drop, the yield on bonds and savings accounts typically declines. And a weaker dollar makes gold cheaper for people with other currencies. It's like gold goes on a global sale, and everyone wants a piece! So, this will drive up its demand and the price. Reason #2: Investors get out of low yielding markets and into gold Remember that when interest rates are high, investors move to high yielding markets. They like to keep their money in the banks, bonds, money market or any other high interest savings accounts. But when interest rates drop, investors don’t make much of their money from these assets. And so, they will look to invest in markets like gold, which will drive the price up. Reason #3: The golden safe-haven will prevail! With interest rate cuts, it normally signals signs of economic uncertainty or weakness. And during these times, investors will often seek out safe-haven assets. Gold is a classic example of a safe haven that investors will look to buy. And this golden attraction will help push the price up.
COMEX:GC1!Education
by Timonrosso
Equal High & Low SweepToday I wanted to talk about two scenarios concerning market structure: the equal high for a bullish structure and the low sweep for a bearish structure. The crucial point of each setup, as always, is to identify a structural change called BOS. From there, I start looking for a demand or supply zone in the market where we should pay attention to observe the price return. This price return should occur as indicated in the setup, with the market starting to consolidate and form a double bottom or top of momentum. It is also important to consider the presence of a liquidity zone, as this will be our primary target zone, followed by the minimum or maximum of the structure. I wish everyone happy trading and remain available for further discussions on the matter.
Education
by EdgeTradingJourney
1
The Best Entry on the MarketIn this model, we will examine a tactical approach to achieve high-performance entry. It all starts with an uptrend characterized by continuous structural changes. In fact, there are continuous directional changes until the retest of the supply zone on M30. Subsequently, the market reacts to this zone by pushing downwards and generating a CHoCH. Here, switching to a 1-minute timeframe, it will be possible to wait for a retest of the supply zone before entering. The trade will target the session or daily low. Greetings and happy trading to all.
Education
by EdgeTradingJourney
1
Understanding LIQUIDITYIn this video I try to explain liquidity as it pertains to training in a simple manner. Liquidity are basically orders in the marketplace. Since trading is a zero-sum game, without liquidity, there is no trading. Simply put, If you wanted to BUY, then you would need someone to SELL to you, and vice versa. Smart Money has deep pockets and needs a large amount of liquidity to facilitate their positions. They want to be able to get in and our of their trades, as well as to be able to trade with capital that would be worth the reward. The largest pools of liquidity usually reside above swing highs and lows, and equal highs and lows (double/triple tops and bottoms). Support and Resistance ideologies dominate the market, and besides that, psychologically it makes sense to put stoplosses at such areas rather than at some random area within a range. There are also breakout traders who see price breaking out of an area as a sign of strength (or weakness if bearish) and they set their entries above/below these levels. This is how liquidity is "engineered" in the market and sentiment manipulated. These pools of liquidity can be seen as a magnet, drawing price to these levels, either to grab liquidity before reversing or continuing in its current direction. - R2F
OANDA:XAUUSDEducation
by Road_2_Funded
14
TradingView is Everything You Need to Start Trading If you are planning to start Forex and Gold trading, I prepared for you a list of 6 essential things that you will need for a successful start. 1 - Charting Software Obviously, if you want to trade, you should analyze the charts. Most of the beginners apply metatrader 4 or 5 for that. Even though meta trader is good as a trading terminal, from charting perspective it is already outdated. My recommendation to you is to apply TradingView for chart analysis. It is very user-friendly, it offers all popular trading instruments, and it has a wonderful community where you can check ideas and forecasts of experienced traders. 2 - Set up Your Watch List There are hundreds of different trading instruments for Forex traders: major and minor pairs, exotic pairs, cfds on gold, silver, oil, etc... Your task as a beginner is to focus on a very narrow list of trading assets. Build a trading list of maximum 8 instruments , learn to trade them and expand the list as you mature in trading. Here is the example of a watch list for beginners: 7 major USD forex pairs. 3 - Make a Trading Plan There are hundreds of different trading strategies and techniques in Forex trading. And obviously, you can not trade them all. Pick a strategy that you like, that makes sense to you. Focus on that and practice, practice, practice. 4 - Economic Calendar Even if you decide to trade only technical analysis, you should not forget to check fundamentals in the economic calendar and learn their impact on the markets. You need an economic calendar for that. There is an economic calendar on TradingView, it is very reliable and you can find the important news there Pay attention to important 3-star news, and preferably don't trade ahead of the releases while you are learning. 5 - Demo Account Trading education is a long journey. While you are studying trading basics and trying different trading strategies, you should strictly trade on a demo account. I recommend paper trading on TradingView, so that you could have the analysis and the trades on the same chart. 6 - Position Size Calculator You should learn to calculate lot size for your trades from the beginning. You should always know how much is your risk per trade. For that reason, placing the trades on a demo account, you should measure lot sizes for your trades. If you demo trade on TradingView, it offers a default position size calculator when you can set the lot size according to a desired risk. Good luck in your journey and be prepared to work hard!
OANDA:XAUUSDEducation
by VasilyTrader
3
The Best Strategy of 2024: Reversal Entry ModelGood morning, today I would like to draw your attention to a model that I am integrating into my analyses for this year. In this model, we define simple structural changes either downwards or upwards, in this context downwards using two BOS. Subsequently, we define the main demand zone where the price retests. After the retest, the price breaks upwards the structure creating a CHOCH, or an internal breakout. Afterwards, the price will move into a lateral phase accumulating a lot of liquidity, and as it is known, as soon as the price absorbs liquidity above or below a range, it then moves in the opposite direction of the filled liquidity. In this case, liquidity is absorbed below in the order block zone and the price moves upwards. I recommend supplementing charts with this model and identifying these setups starting from an H4 timeframe which can be simpler compared to smaller timeframes. Best regards and happy trading to everyone.
Education
by EdgeTradingJourney
1
How to Build Your Portfolio Like a Professional InstitutionInvesting at the institutional level involves a sophisticated blend of strategies, risk management, and performance measurement to achieve optimal returns. One of the cornerstones of creating an institutional-grade portfolio is the use of optimization methods, with particular focus on ratios such as the Sharpe Ratio, Sortino Ratio, and Omega Ratio. In this guide, we'll delve into what these ratios are, how they differ, and when to use each to construct a robust institutional-grade portfolio. Understanding the Ratios Sharpe Ratio Definition : The Sharpe Ratio, developed by Nobel laureate William F. Sharpe, measures the performance of an investment compared to a risk-free asset, after adjusting for its risk. It is calculated by subtracting the risk-free rate from the return of the portfolio and dividing by the standard deviation of the portfolio's excess returns. Usefulness : This ratio helps investors understand how much excess return they are receiving for the extra volatility that they endure for holding a riskier asset. A higher Sharpe Ratio indicates a more attractive risk-adjusted return. Sortino Ratio Definition : Similar to the Sharpe Ratio, the Sortino Ratio also measures the risk-adjusted return of an investment portfolio. However, it differs by only considering downside volatility (negative returns) rather than the total volatility of returns. Usefulness : This focus on downside risk makes the Sortino Ratio particularly useful for investors who are more concerned about potential losses than the overall volatility. A higher Sortino Ratio indicates that the portfolio is efficiently earning more on its downside risk. Omega Ratio Definition : The Omega Ratio is a more comprehensive measure that divides the returns above a certain threshold (typically the risk-free rate) by the returns below that threshold. It considers all the moments of the distribution of returns, not just the first two moments (mean and variance) like the Sharpe and Sortino ratios. Usefulness : This ratio is especially valuable for portfolios that do not follow a normal distribution of returns, providing a more holistic view of performance across different risk levels. A higher Omega Ratio indicates better performance per unit of risk. How They Differ The primary difference among these ratios lies in how they measure risk and returns: Sharpe Ratio considers the total volatility (standard deviation) of portfolio returns, treating all volatility as equal. Sortino Ratio improves on this by focusing only on downside risk, which is more relevant for investors concerned about losses. Omega Ratio goes further by considering the entire distribution of returns, offering insights into the performance across all levels of risk. Situational Use Sharpe Ratio : Ideal for general comparisons of portfolio performance where the investor is concerned with both upside and downside volatility. It's particularly useful when comparing portfolios or investments with similar risk profiles. This ratio is commonly used by most large financial institutions due to the large sums of money they manage and ensuring portfolio stability is prioritized over larger profits. Sortino Ratio : Best used when the investor's primary concern is with the downside risk rather than total volatility. This ratio is suitable for portfolios where strategies are aimed at minimizing losses rather than capturing every potential upside. This ratio is used by investors who are able to stomach more volatility in their portfolio in return for a higher probability of gains while effectively reducing equity downside. Omega Ratio : Most beneficial for analyzing portfolios with non-normal distributions of returns, such as those including options, leveraged investments, or hedge funds. It provides a nuanced view of performance across different levels of risk, making it suitable for sophisticated investment strategies that aim to manage risk in a more granular manner. Due to the nature of this ratio, only investors who have a larger risk appetite and require aggressive growth should use this ratio as the omega ratio will not necessarily be affected by high portfolio drawdowns as long as the runups are significantly higher. This means a portfolio could experience a 60% drawdown, followed by a 1000% runup, and the Omega Ratio calculation would return a high value as the probability of gains still outweigh the probability of losses. Conclusion Constructing an institutional-grade portfolio requires a nuanced understanding of both the opportunities and risks present in the investment landscape. By leveraging the Sharpe, Sortino, and Omega ratios, investors can better assess the risk-adjusted performance of their portfolios, tailoring their investment strategies to meet specific risk and return objectives. Whether you're managing a conservative fund focused on minimizing losses or a dynamic portfolio seeking to capitalize on market inefficiencies, these ratios provide critical insights that can help optimize your investment approach for superior risk-adjusted returns.
NASDAQ:TSLAEducation
by AlgoAlpha
2
TYPES OF ORDER BLOCKThis educational post is great for beginners who are just starting to grasp the concept of SMC. We've already talked about what an order block is. This time we'll talk about other types of blocks in trading. ✴️ Mitigation Block Mitigation Block is a sell or buy zone, which is formed when the market structure (BOS) continues. In other words, it is a broken order block and tested, but from the other side. We all know that when the price is moving along a trend, it is better to open trades in the direction of this trend. The most optimal points for buying and selling are the price pullback. By this logic a mitigation block is formed. Mitigation Block Sell Scheme Mitigation Block Buy Scheme Those who trade classical technical patterns will notice that it is anything but: a support zone becomes a resistance zone, and a resistance zone becomes a support zone. Institutional level traders understand the skills and knowledge of classical technical analysis traders, so they manipulate the price to generate and collect additional liquidity. In this zone we have our block, an ordinary block, which becomes a mitigated block after an impulse breakout. Schematically, the Mitigation Block in sell looks like this: Schematically, Mitigation Block in buy looks like this: ✴️ Breaker Block Smart Money Breaker Block is a sell or buy zone that is formed when the market structure (BOS) continues. In other words, it is a broken order block and tested, but from the other side. An important difference from a broken Block is that there is a change in market character (CHoCH). As you have understood, the essence of sell zones and blocks remains the same as in Mitigation Block, but first there is a liquidity grab, and then there is a change in market character (change in market structure). It looks schematically as follows: Breaker Block Sell Scheme Breaker Block Buy Scheme ✴️ Rejection Block Smart Money A Rejection Block is a selling or buying zone that appears on the chart as long candlestick tails at a market high or low. As in all other cases, the block is formed only after liquidity is grabbed from the previous high/minimum or equal highs/minimums. This is classically referred to as a false breakout or sweep. Bullish and Bearish Rejection Block The logic of building and searching for a Rejection Block is very simple: Bearish Rejection Block: Swing High, find the highest candle whose high and close are higher than the high and close of the neighbouring candles respectively. The tail (wick) of the candle will be the bearish order block. Bullish Rejection Block: Swing Low, we find the lowest candle, the minimum and close of which are lower than the minimum and close of the neighbouring candles respectively. The tail (wick) of the candle will be a bullish order block. It does not matter what colour the candle is. At the maximum it can be not only bullish but also bearish, and at the minimum it can be not only bearish but also bullish. This is worth paying attention to. Look for the highest candle, with the highest open or close and with the highest wick (same in the opposite direction). ✴️ Vacuum Block Smart Money A block stands out as a regular gap - from the high of the first candle to the low of the second candle in an up gap and vice versa, from the low of the first candle to the high of the second candle in a down gap. We can expect 2 variants of price movement: in continuation, return to the gap zone to fill it partially or completely. This is based on the presence and size of the block order. Complete gap filling Complete gap filling of the price void can be expected if there is an order block that is above or below the Vacuum Block. The price can bounce from the beginning of Vacuum Block, but in order to reduce the risk it is better to wait until the block is fully closed and touched. Partial filling of the gap A partial filling of the price void can be expected if the order block is below or above the Vacuum Block, but they overlap. The price can rebound from the beginning of the Vacuum Block, as well as overlap it completely. This is shown schematically in the figure above. ✴️ Conclusion You should realize that you don't need to click the "buy" or "sell" buttons where you see one of the block options. An order block is simply a price range where you can consider buying or selling, depending on your preliminary analysis and determining the context of the price movement. You will trade from every block a capital loss is guaranteed. Price moves for liquidity. This is the main analysis, and only then we look for the place (blocks) where we can jump from a less risky place.
Education
by DeGRAM
16
The Ultimate Strategy | ChoCh + InducementThis strategy is based on identifying a market structure, which can be bullish or bearish. In this specific case, a bullish structure characterized by rising highs and lows is considered. The expectation is for the market to change direction, creating a shock. Subsequently, the formation of a liquidity block is observed during a market consolidation phase, followed by entering a demand zone where the imbalance dictates, and the response is a downward movement, as anticipated. The target of this movement is defined graphically. Greetings and happy trading to everyone.
Education
by EdgeTradingJourney
3
Decoding Market Mood: The Sentimental Drivers of Gold FuturesIntroduction In an era where information is as precious as gold itself, understanding the underlying currents that drive market sentiment has become crucial for traders and investors alike. Gold Futures, a standard in hedging against economic uncertainty and inflation, serve as a beacon for those navigating the volatile seas of the financial markets. This article embarks on an explorative journey into the realm of sentiment analysis, uncovering how shifts in global mood translate into movements in Gold Futures prices. Through a blend of case studies and theoretical insights, we will decode the signals broadcasted by market participants, hopefully offering a compass for those seeking to align their strategies with the underlying emotional and psychological state of the market. Understanding Sentiment Analysis The Essence of Sentiment Analysis: At its core, sentiment analysis in the financial markets involves the qualitative assessment of the collective mood or opinion of investors towards a specific asset or the market as a whole. It transcends traditional analysis by incorporating psychological and emotional factors, aiming to assess market movements based on the prevailing sentiment. This approach acknowledges that market prices are not solely driven by fundamental indicators but are also heavily influenced by human emotions and perceptions. Application in Financial Markets: In the realm of Gold Futures, sentiment analysis serves as a powerful tool to gauge investor confidence, fear, and overall market outlook. It encompasses the examination of various sources, including news articles, social media chatter, economic reports, and geopolitical events, to construct a sentiment score or index. This score reflects the general optimism or pessimism surrounding gold as an investment, influencing traders' decisions to buy or sell Gold Futures contracts. The Impact of Sentiment on Gold Prices: Gold's allure as a safe-haven asset makes it particularly sensitive to changes in market sentiment. During times of economic uncertainty or geopolitical tensions, a surge in pessimism can lead to increased demand for gold, pushing prices upward. Conversely, in periods of market optimism, where riskier assets become more appealing, gold may see reduced demand, leading to a decline in prices. Understanding these sentiment-driven dynamics is essential for anyone trading Gold Futures, as it allows for more informed decision-making, aligning trades with the broader market mood. Factors Influencing Gold Market Sentiment The sentiment toward gold is shaped by a myriad of factors, ranging from macroeconomic indicators to geopolitical events. Understanding these influences is paramount for traders aiming to navigate the Gold Futures market effectively. This section delves into these factors, reinforced by case studies that highlight their impact on gold prices. Economic Indicators and Central Bank Policies: Gold is often viewed as a hedge against inflation and currency devaluation. Economic indicators such as inflation rates, GDP growth, and unemployment figures significantly influence investor sentiment toward gold. Central bank policies, including interest rate decisions and quantitative easing measures, also play a crucial role. For instance, a decision by a major central bank to lower interest rates can lead to a weaker currency, prompting investors to turn to gold as a store of value. Case Study 1: Gold finishes October on a high In October 2023, amidst heightened geopolitical tensions and central bank activities, gold rallied, marking its highest monthly close by the LBMA PM price. This movement was influenced by a combination of factors, including COMEX futures' net short positions and substantial ETF inflows. The case underscores how geopolitical uncertainties and central bank maneuvers can drive investor sentiment, steering the direction of Gold Futures prices. Geopolitical Tensions Geopolitical events and uncertainties can lead to increased volatility in the financial markets, with gold often benefiting as a perceived safe haven. Conflicts, elections, and trade negotiations can sway investor sentiment, leading to spikes in gold demand. Case Study 2: Geopolitical and economic uncertainty boost gold demand and prices The World Gold Council's report indicated a slight dip in annual gold demand for 2023 but highlighted that demand from OTC markets and central banks kept the average annual gold price at historic highs. Despite ETF outflows, sectors like bar and coin investment and the global jewelry market showcased resilience, illustrating how geopolitical and economic uncertainties can bolster gold's appeal. Social and Environmental Considerations The growing emphasis on responsible sourcing and environmental sustainability is influencing investor sentiment toward gold. Initiatives aimed at ethical mining practices and combating illicit gold trade affect the market's perception and, subsequently, gold prices. Case Study 3: Collaboration underway to develop consolidated standard for responsible mining Efforts to establish a global standard for responsible mining, involving major industry players, highlight the market's shift toward sustainability. This collaboration aims to create a unified framework that reassures investors about the ethical provenance of their gold investments, potentially impacting demand. Case Study 4: World Gold Council and DMCC Collaborate to Combat Illicit Hand-Carried Gold Trade This strategic initiative to strengthen international regulations around gold sourcing and trade showcases the industry's commitment to ethical practices. Such measures not only enhance gold's reputation as a responsible investment but also influence market sentiment by ensuring a more transparent and reliable supply chain. Central Bank Activities Central banks are significant players in the gold market, with their buying and selling activities offering insights into their confidence in the global economy. Their actions can serve as a barometer for gold's future trajectory. Case Study 5: Central banks maintain historic buying pace in Q3 The Q3 2023 Gold Demand Trends report highlighted continued robust demand for gold, with central bank purchases significantly contributing to quarterly demand. This activity underscores central banks' role in bolstering gold market sentiment and illustrates their confidence (or lack thereof) in the current economic landscape. Applying Sentiment Analysis to Gold Futures Trading Incorporating sentiment analysis into trading strategies for Gold Futures involves a nuanced understanding of market mood and its implications for future price movements. This section discusses the current sentiment influenced by geopolitical and economic uncertainty and how it sets the stage for trading decisions in 2024. Current Market Sentiment and Gold Futures As we edge into 2024, the geopolitical and economic landscape continues to shape investor sentiment toward gold. The World Gold Council's Gold Demand Trends report for 2023 highlighted a nuanced market. Despite a slight decline in annual demand, the total demand reached a new record, propelled by central bank buying and OTC investments. This paradoxical situation—where demand dips but overall interest remains high—underscores the complex interplay of factors influencing gold prices. The Future of Gold Futures and Sentiment Analysis As sentiment analysis becomes increasingly sophisticated, its application in trading Gold Futures is expected to evolve. The development of AI and machine learning tools will enhance our ability to gauge market mood, providing traders with deeper insights and more accurate predictions. The integration of sentiment analysis into trading strategies will likely become more mainstream, offering a competitive edge to those who can interpret and act on market sentiment effectively. Trade Plan for Gold Futures Given the current sentiment and market conditions, there's a compelling case for a bullish outlook on gold. As such, we present a trade plan to go long on Gold Futures, with specific attention to risk management and catering to traders with varying risk appetites. Point Values and Contract Options Standard Gold Futures (GC): Each contract represents 100 troy ounces of gold, and the point value is $100 per troy ounce. This means a $1 move in the gold price equates to a $100 change per contract. Micro Gold Futures (MGC): For traders with a lower risk tolerance, Micro Gold Futures offer a smaller-scale opportunity. Each MGC contract represents 10 troy ounces of gold, with a point value of $10 per troy ounce, providing a more accessible entry point into gold trading. Trade Plan Details Entry Price: 2045.2 Stop Loss Price: 2001.7 Target Price: 2156 Rationale: The entry is predicated on current sentiment indicators and technical analysis, suggesting an upward momentum. The stop loss is strategically placed below key support levels to mitigate risk, while the target price is set at a level that previous sentiment-driven rallies have reached. Micro Gold Futures for Lower Risk Appetite For traders looking to engage with the gold market at a reduced risk level, Micro Gold Futures (MGC) provide an excellent alternative. Utilizing the same trade plan but with MGC contracts allows traders to manage their exposure more precisely, tailoring their investment to their comfort with risk while still capitalizing on gold's potential upside. Risk Management and Consideration Effective risk management is the cornerstone of successful trading, especially in the volatile realm of Gold Futures. Trading based on sentiment analysis introduces unique challenges and opportunities, making it imperative for traders to employ robust risk management strategies. This section emphasizes the significance of managing risk to preserve capital and sustain profitability over the long term. Understanding Risk in Sentiment-Based Trading Trading on sentiment involves interpreting market moods that can swiftly change due to unforeseen events or shifts in investor perception. Such volatility requires traders to be vigilant and adaptive, employing strategies that protect against sudden market movements. Key Risk Management Strategies Setting Stop Loss Orders: A well-placed stop loss can prevent significant losses by automatically closing a position if the market moves against your prediction. For the trade plan outlined (going long on Gold Futures), the stop loss at 2001.7 is critical for limiting potential downside. Position Sizing: Adjusting the size of your trade according to your risk tolerance and account size can mitigate risk. For traders utilizing Micro Gold Futures (MGC), this means leveraging the smaller contract size to maintain control over exposure. Diversification: While our focus is on Gold Futures, diversifying your portfolio across different assets can reduce risk. This strategy ensures that adverse movements in gold prices do not disproportionately impact your overall trading performance. Regular Monitoring and Adjustment: Sentiment can shift rapidly; regular monitoring of sentiment indicators and readiness to adjust your positions accordingly is essential. This includes potentially moving stop loss levels or taking profits early if the sentiment begins to change. Utilizing Hedging Techniques: Options and other derivative products can be used to hedge against your Gold Futures positions, offering protection against adverse price movements. Incorporating Micro Gold Futures for Risk-Averse Traders Micro Gold Futures contracts provide a nuanced way to engage with the gold market while managing risk exposure. For those cautious about sentiment-driven volatility, trading MGC allows for participation in potential upside movements without the larger capital exposure associated with standard Gold Futures contracts. Conclusion: The Sentimental Journey of Gold Futures The intricate dance between market sentiment and Gold Futures prices underscores the dynamic nature of financial markets. By decoding the mood of the market, traders can align their strategies with the prevailing winds, navigating through periods of uncertainty with informed confidence. This article has journeyed through the application of sentiment analysis, from understanding its foundations to applying it in trading strategies, and underscored the paramount importance of risk management. As we look ahead, the role of sentiment analysis in trading Gold Futures is poised to grow, propelled by advancements in technology and a deeper understanding of market psychology. The traders who succeed will be those who not only master the art of sentiment analysis but also adhere to disciplined risk management practices, ensuring their trading journey is both profitable and sustainable. In the ever-changing landscape of the gold market, the wisdom lies not just in predicting the future but in preparing for it with a well-rounded strategy that embraces sentiment analysis as a powerful tool in the trader's toolkit. When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies. General Disclaimer: The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
COMEX:GC1!Education
by traddictiv
2
What is TRADING PLAN and how to use it ! What is TRADING PLAN ? A trading plan is a systematic method for identifying and trading securities that takes into consideration a number of variables including time, risk and the investor’s objectives. A trading plan can help traders and investors to achieve consistent results and avoid emotional or impulsive decisions. A trading plan should be written in a clear and concise manner and be regularly reviewed and updated. One of the main benefits of having a trading plan is that it can help traders and investors to define their personal trading style and goals. For example, some traders may prefer to trade in the forex market, which is the world’s largest financial market and offers high liquidity, around-the-clock trading and the possibility of using leverage. Other traders may opt for the stocks market, which involves buying and selling shares of well-established and financially sound companies, also known as blue chips. Blue chips are generally considered to be less volatile than forex and may offer steady growth potential and dividends to investors. Another advantage of having a trading plan is that it can help traders and investors to identify the best trading opportunities and strategies for their chosen market and instrument. A trading plan should include the following elements : • Entry and exit rules : These are the criteria that determine when to open and close a position, based on technical or fundamental analysis, indicators, signals, patterns, trends, etc. If I want to explain more, I have to say that Entry and exit rules are the criteria that determine when to open and close a position, based on technical or fundamental analysis, indicators, signals, patterns, trends, etc1. They are essential for having a trading plan and a trading strategy, as they help traders and investors to define their personal trading style and goals, identify the best trading opportunities and strategies, and manage their risk and reward. For example, if you are a trend-following trader, you may use a moving average crossover as an entry rule, meaning that you buy when a faster moving average crosses above a slower moving average, indicating an uptrend, and you sell when the opposite happens, indicating a downtrend. You may also use a trailing stop as an exit rule, meaning that you adjust your stop-loss order to follow the price as it moves in your favor, locking in some profits and protecting yourself from a reversal. Entry and exit rules can vary depending on the market, instrument, time frame, and trading style that you choose. They can also be combined with other tools and techniques, such as risk-reward ratio, position sizing, diversification, etc. The key is to have clear and consistent entry and exit rules that suit your trading plan and objectives, and to follow them diligently. • Risk management : Risk management is the process of controlling the potential losses and maximizing the potential gains of each trade, by using tools such as stop-loss orders, profit targets, position sizing, diversification, etc. Risk management helps traders and investors to protect their trading accounts from losing all of its money and to achieve consistent results. Some common risk management strategies for traders are2: Determining your risk appetite : This means knowing how much you are willing to risk on each trade, based on your trading goals, capital, and risk tolerance. A common rule of thumb is to never risk more than 1% of your account on any single trade. Knowing your risk-reward ratio : This means calculating the expected return of each trade, compared to the potential loss. A risk-reward ratio of 2:1 or higher is generally considered favorable, meaning that the potential profit is twice as large as the potential loss. Using stop-loss orders : These are orders that automatically close your position when the price reaches a certain level, to limit your losses. Stop-loss orders can be fixed or trailing, meaning that they can follow the price as it moves in your favor. Using profit targets : These are orders that automatically close your position when the price reaches a certain level, to lock in your profits. Profit targets can help you to exit the market at the optimal time and avoid greed or fear. Position sizing : This means adjusting the size of your position according to your risk appetite, risk-reward ratio, and market conditions. Position sizing can help you to balance your portfolio and diversify your risk. Diversification : This means spreading your risk across different markets, instruments, time frames, and strategies. Diversification can help you to reduce your exposure to specific risks and increase your chances of success. Risk management is an essential but often overlooked prerequisite to successful trading. By following a rational and objective approach to risk management, you can avoid common pitfalls such as overtrading, undertrading, revenge trading, fear of missing out, etc. Risk management can also increase your confidence, discipline, and consistency, which are vital for success in the financial markets. • Performance evaluation : This is the method of measuring and analyzing the results of the trading plan, by using metrics such as win rate, risk-reward ratio, drawdown, return on investment, etc. A trading plan is not a static document, but a dynamic one that should be adapted to the changing market conditions and the trader’s or investor’s experience and skills. A trading plan should be tested and backtested before being implemented in the live market, and should be reviewed and revised periodically to ensure its effectiveness and suitability. Having a trading plan in forex and stocks market can help traders and investors to achieve their financial goals and avoid common pitfalls such as overtrading, undertrading, revenge trading, fear of missing out, etc. A trading plan can also increase the trader’s or investor’s confidence, discipline and consistency, which are essential for success in the financial markets. KEY POINTS : A trading plan is a systematic method for identifying and trading securities in the forex and stocks market. A trading plan can help traders and investors to achieve consistent results and avoid emotional or impulsive decisions. A trading plan should include entry and exit rules, risk management, and performance evaluation. A trading plan should be written, tested, reviewed, and updated regularly. A trading plan can increase the trader’s or investor’s confidence, discipline, and consistency. Prepared by : Arman Shaban
OANDA:XAUUSDEducation
by ArmanShabanTrading
25
Learn What is FOREX Market. Trading Volumes & Market Participant Forex - foreign exchange market, is a location where international currencies are bought and sold by economic participants at various exchange rates. Forex market is the biggest market in the world, reaching on average 6 trillion dollars trading volumes daily. Forex market is a vital element for a global economy because it provides capital exchanges between the countries. The main market participants of forex market are central banks, commercial banks, commercial companies, hedge funds and investors. 🕰In order to grasp how big is that market, take a look what is happening on that just in 60 seconds: 📎Total transactions value reaches 3.52 billion US dollars. 📎 1.15 billion dollars of spot transactions. 📎 1.65 billion dollar of exchange swaps. 📎 Total transactions value involving USD reaches 3 billion US dollars. 📎 Total transactions value involving EURO reaches 1.1 billion US dollars. 📎 Just one single EUR/USD pair accumulates 812 million US dollars transactions value. It is hard to imagine how such big amounts are rolling with such a frequency and how insignificant are the orders of individual traders.
OANDA:XAUUSDEducation
by VasilyTrader
1
Bitcoin REALISM I am definitely not going to win any popularity competitions with my comments and thoughts. But that's not the point when it comes to making money. The main issue for me still in Crypto Land is the lack of realism. The image on the front cover was from a google search of "realism" I guess the confused face made my day. This is exactly how you need to be looking when you read these points below. I have explained the logic of every major move over the last couple of years and this guys - is no different. So let's start by exploring the reality of market cap for one. When you buy a stock you have a number of stocks in circulation times that by the price and you can get a market cap. Of course, unlike most companies on the exchange Bitcoin CANNOT just issue new stock. We have to remember some Bitcoin are gone and lost forever so this number will likely end up around 20million and not the full 21m. The current Market cap is roughly 19,806,000 x $42,897. Let's call it a little over 820 Billion. At the ATH of $69,000 we saw $1.302 Trillion. Lets look at what is needed and an angle of attack if Bitcoin was to hit $500k by Jan 25, 26, 27, 28 or 2029. This is only one aspect of the story. Prior to the ETF launch people were saying silly things like "Trillions coming in, $100k imminent" Blackrock's largest ETF is roughly $354 Billion. This is the SP500 fund founded back in 2001. So 23 years old roughly now. Here's the actual chart. What does this mean? Well, let's say Blackrock decided to close their biggest ETF and throw it all into Bitcoin. That level would still not take us back to the current ATH. Bullish, Bullish, Bullish - we are still $25,000+ under the current ATH. So what about other ETF's? Obviously the market is bigger than just Blackrock. Let's look at this aspect too. Look at the end of 2021 as the ETF market collectively was at it's high. We are talking about $10Trillion in 8,552 ETF's. I've posted several times about the current COT landscape. Clearly social media Bitcoin is buzzing and everyone is about to become rich, it's different this time and so on. Well, COT says otherwise. Back at the top when everyone was calling for $135,000 I said the reason for the drop would be liquidity. So why is this different? I said there were two likely scenario's on the table as we moved down. The first was we were in an early stage accumulation, we needed to go up to 32k and back down to the low 20's. This would allow us to travel much higher and sustain such a large move. The second option was bearish. Well, I guess the second move played out. The momentum is still clearly not with us - we are still FWB:25K + under the current ATH - not what one would or should expect after 12 Bitcoin specific ETF's obtaining approval & launching. Look at the momentum People seem to fall into the echo chamber and all logic leaves the building. I have been at this game a long, long time. Seen it all before and I am sure I will see it again. This does not mean I am Bearish or anti Bitcoin - not for one second. I am one of the lucky ones in at the right time, sold a lot on the way up and happy with the current holdings. All I am trying to emphasis here - is don't get sucked into the void which is not supported by ANY sound logic. I recently watched a couple of video's with Warren Buffet, another with Jim Rickards. They both explained something very interesting in a very clear way. Although Anti Bitcoin - what they said made a lot of sense. The same lesson kinda applies to things like gold. When you buy an asset, the asset can produce for you. So assume you buy a house - you get rental income each month and with the price of the property going up over time you make gains there. Buy a business same thing - Buffet explained this using a farm as the example. Sell grains, cows or whatever you farm. Over time you still hold the asset. This isn't true for the likes of diamonds, gold or Bitcoin. Hence it fits into the greater fool theory. If I sell you my last bitcoin I picked up for less than $200. You buy it all today at $42,850. You have to find someone else willing to pay you more than the $42,850 in the future. For me, this is the main reason I don't personally care up or down or sideways here. But many in the echo chamber do. The average price across the breakeven addresses are around $37k - this is Breakeven not profit. So imagine majority of the retail crowd with an average entry after DCA'in at $37k. These are all things to keep in mind when your playing shorter term moves. ETF's are structured in such a way long term growth can be expected, volatility get's somewhat reduced. You noticed what's happened on the weekends since the launch? So whilst I expect it to go up in the long run. We need a healthy pullback as to be expected. This gives more time for real accumulation to happen - but this will also put some stress on that average (BE) level of $37k. Just keep this in mind and one more thing if you want to comment on "oh your wrong - up only" give some logic to support it or I won't bother responding. This move will take time. For me, nothing has changed since 2022. We are not ready for new highs - YET... Anyway enjoyed or not I thought it was worth another educational post. Stay safe! Disclaimer This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years’ experience in stocks, ETF’s, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
COINBASE:BTCUSDEducation
by Mayfair_Ventures
74