How BIG BANKS and FINANCIAL INSTITUTIONS trade?!_____
How I Doubled a 200k Account
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SUPERGOLDEN RATIO in FOREX TRADING
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Save your account from a Margin Call!
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Learning
Investment Risk Scale
When investing funds in any format, you need to understand the
investment approach and risk involved in the planning you undertake.
Example investment risk categories when investing capital or income are as follows:
1-2
Lowest Risk
Very Cautious Risk
You are not prepared to accept any exposure to investment loss although you
are aware that any investment has some possibility of loss, for example if a bank
holding your money was to collapse. The value of your money may also fall in
real terms if inflation exceeds the return that your investment achieves. You
accept that the returns from your investments are likely to be low compared to
the potential returns from investments that have a higher risk rating.
3-4
Cautious Risk
You are prepared to accept a higher risk of capital loss in return for the
opportunity to earn more than from deposits and low risk type investments but
do not wish to take as much risk as with a medium risk strategy. While there can
be no guarantee, investments in this category are not likely to fluctuate in value
as sharply or as quickly as a portfolio largely made up of equity investments.
5-6
Balanced Risk
You are prepared to accept that the value of your investments will fluctuate
with the aim of achieving higher returns in the medium to long term. You accept
that there is an increased risk of capital loss over investing in more low risk
investments. Medium risk investments can fluctuate in value more rapidly and
quickly over a short periods of time than more low risk investments.
7-8
Adventurous Risk
You are prepared to accept fairly high levels of risk with your investments,
with the aim of achieving higher investment returns in the longer term. You
accept that this may mean that the value of your investments may fluctuate
considerably over a short periods of time and that there is an increased risk of
capital loss compared with a lower risk investment strategy.
Therefore, you may consider investments mainly in equities/shares and is likely
to involve investment in various overseas markets as well as UK markets. This
increases risk because of currency fluctuations as well as investment risk. Risk
can be reduced by diversifying your investments across sectors and markets
9-10
Highest Risk
Very Adventurous
Risk
You are prepared to accept high levels of risk with your investments, with the
aim of achieving higher investment returns in the longer term. You accept that
this may mean that the value of your investments may fluctuate significantly
over a very short periods of time and you could lose a significant proportion
(possibly all) of your investment.
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❗️CONFIRMATION BIAS IS YOUR ENEMY❗️
🏛As traders, we are constantly bombarded with information on the global economic landscape, market trends, and potential investments. With so much information at our fingertips, it is easy to fall victim to a cognitive bias known as confirmation bias.
🏛Confirmation bias, also known as selective perception, is the tendency for individuals to seek out and interpret information in a way that confirms their existing beliefs or hypotheses. In the world of trading, confirmation bias can be particularly dangerous, as it can lead traders to make decisions based on incomplete or biased information.
🏛For example, imagine you hold a strong belief that apple stocks are going to rise in the coming months. You begin to search for information to support this belief - perhaps you read articles, listen to news broadcasts, and consult financial websites that all confirm your hypothesis. Meanwhile, you are dismissing any information that contradicts your belief, such as negative earnings reports, changes in the market, or negative press.
🏛The problem with this type of thinking is that it can lead traders to ignore crucial signs that could indicate a shift in the market. Confirmation bias can cloud our judgment and hinder our ability to make objective, data-driven decisions.
🏛To avoid confirmation bias, traders need to actively seek out and consider evidence that contradicts their established beliefs. By doing so, traders can obtain a more comprehensive view of the market and make informed decisions based on all available information.
🏛Furthermore, it is essential to rely on multiple sources of information, including information from trusted analysts, financial experts, and data-driven research. Traders must be able to evaluate information objectively and dispose of preconceived notions that may color their decision-making process.
🏛In conclusion, confirmation bias is a cognitive bias that can significantly impair traders' abilities to make sound decisions in the market. Traders must be cognizant of this bias and actively work to identify and address it by seeking out multiple sources of information, analyzing data objectively, and challenging their preconceived beliefs. Only by doing so can traders ensure that their decisions are based on informed and rational conclusions, rather than biased opinions or incomplete information.
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10 Things I Wish I Knew When Getting Started With TradingHere are ten key points I wish I knew 11 years ago
1. Position Sizing: Trade with suitable position sizes to minimize the emotional impact on decision-making. Ensure your trades are neither too small nor too large, balancing the potential for profit and the ability to make rational decisions.
2. Avoid FOMO: Don't trade based on the fear of missing out. Make informed decisions by analyzing the market and potential trades, rather than being swayed by others' excitement or panic.
3. When to Exit a Trade: Focus on trading based on technical analysis, not your profit and loss. Exit a trade when the conditions you entered the trade no longer apply. Consider using mental stops over hard stops, but only if you have enough experience.
4. Journal: Keep a detailed record of your trades to analyze and improve your performance. Track your wins, losses, and the specific conditions of each trade to identify areas that require improvement.
5. Buy High, Sell Higher: Embrace the concept of buying into strong trends for greater success. While "buy low, sell high" is a common mantra, buying into a growing trend can be a more effective strategy.
6. Different Types of Trades: Understand and become comfortable with various trade types, such as scalping, momentum trading, technical-based trades, and options trading. Each type requires different strategies and scanning techniques.
7. Resources: Choose educational resources wisely. Avoid get-rich-quick schemes and focus on informative materials that teach essential concepts like candlesticks, indicators, options, and scanner settings. Look for resources that acknowledge the difficulty of trading and offer well-rounded, sustainable strategies.
8. Stop Predicting Tops and Bottoms: Focus on following the charts and resist the urge to predict tops and bottoms. Counter-trend trading is a common reason new traders lose money.
9. You Are Not an Economist: Trade based on current market conditions, not long-term predictions. Avoid developing a market bias that could negatively impact your trades, even your day trades.
10. Don't Trade What You Don't Know: Gain sufficient knowledge before trading a particular instrument. Jumping into a trade without understanding the underlying mechanisms can lead to costly mistakes. Educate yourself before diving into new trading instruments.
Yours,
Forex market players: Who trades Currencies and Why?
The foreign exchange market is used by banks, investment companies, companies and even individuals who want to either cover themselves against the risk of foreign exchange fluctuations or to speculate in hopes of making a profit. 95% of all forex transactions are purely speculative in nature. Only 5% of all forex transactions result from international companies who need to convert their money back to the company's main operating currency.
Commercial banks are the main participants in the forex market, but their "market share" is slowly shrinking. Currently, 43% of all transactions pass through the interbank market, as opposed to 63% in 1998 and 53% in 2004. In terms of forex trading activity, the main role of banks is to serve as middlemen for the other market participants. Their objective is to make profits through "market making", which means that they offer their clients a "buy" price and a "sell" price.
Institutional investors are the second biggest players. They include investment and insurance companies, pension funds and hedge funds. They participate in forex trading in order to cover their stock, bond and currency portfolios and they represent 30% of all foreign exchange transactions.
Central banks intervene to manage their stock of currency and state money. Their transactions represent 5% to 10% of all forex trading volume. The central banks can also intervene in order to defend their respective currencies and to adjust economic or financial inbalances.
Brokers allow private individuals to access the forex market by transmitting their clients' orders to commercial banks or to trading platforms. They get paid from the spread or by charging a commission on each transaction.
Multinational companies participate in forex trading in order to convert their money during import or export activities. Their transactions represent approximately 5% of all global forex transactions. Some companies even have their own trading floors, with traders speculating in order to make profits and to reduce the risks related to exchange rate fluctuations.
Private investors/individuals have recently been trading the forex market as well, thanks to the internet, which allows them to have real-time access to currency exchange rates. Today, their transaction volume adds up to over 5% of all forex transactions.
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Understanding Anchoring Bias in Trading
Anchoring is a heuristic in behavioral finance that describes the subconscious use of irrelevant information, such as the purchase price of a security, as a fixed reference point (or anchor) for making subsequent decisions about that security. Thus, people are more likely to estimate the value of the same item higher if the suggested sticker price is $100 than if it is $50.
Anchoring is a cognitive bias in which the use of an arbitrary benchmark such as a purchase price or sticker price carries a disproportionately high weight in one's decision-making process. The concept is part of the field of behavioral finance, which studies how emotions and other extraneous factors influence economic choices.
An anchoring bias can cause a financial market participant, such as a financial analyst or investor, to make an incorrect financial decision, such as buying an overvalued investment or selling an undervalued investment. Anchoring bias can be present anywhere in the financial decision-making process, from key forecast inputs, such as sales volumes and commodity prices, to final output like cash flow and security prices.
Historical values, such as acquisition prices or high-water marks, are common anchors. This holds for values necessary to accomplish a certain objective, such as achieving a target return or generating a particular amount of net proceeds. These values are unrelated to market pricing and cause market participants to reject rational decisions.
Beware of your mental fallacies. They are your main enemy in trading.
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SOL rises to $21.20 is bullish TL;DR Breakdown
Solana price analysis shows a bullish trend
Resistance for SOL is present at the $21.32 mark
Support for the SOL token is present at $20.69
Solana price analysis shows a bullish trend as the token surged above the $21.00 level, and it is currently trading at $21.20. This is a 2.25% increase from the previous 24 hours and shows that the bullish pressure behind SOL continues to grow. The current resistance for SOL is present at the $21.32 mark, so if the price breaks above this level, then we can expect further gains in the near term. On the flip side, the current support for the SOL token is present at $20.69, and if it holds, then we can expect a continuation of its bullish trend.
DOGE Best time to short ? im expecting short in DOGE IF The rsi go below 50 level its so risky when you join revers the trend so ill only open Paper trade
Scalping vs Day Trading vs Swing Trading | Learn What is Best
Knowing which trading style suits you best is a difficult question to answer, but the choice you make is not permanent. In fact, many novice traders will experiment with some or all of the various styles before settling on a method and strategy that suits their lifestyle and the funds they have to risk.
Scalping
The first trading style of this guide is called "scalping". Scalping is a form of trading where traders aim to achieve profits from relatively small price changes.
Scalpers enter and exit the financial markets within a short time-frame, which is usually a matter of a few seconds, or minutes (but the maximum is a few hours) and are known to use higher levels of leverage.
Day trading
Many traders think that day trading and scalping are similar. Although both trading styles do take place within one trading day, there are important differences that we need to highlight. Day traders open and close substantially less setups compared with scalpers. These traders sometimes open one setup a day, and often not more than a couple per trading day.
Although they both trade intraday, the day trader's strategy is to focus on the best opportunities of the day, and to hold on for a larger profit target. Therefore, a day trader usually holds on to a trade for several hours but not more than one full trading day.
Swing trading
The last trading style of our guide is called swing trading, which is a style in which traders enter and exit sporadically, holding trades over a few days or weeks. Swing trading is a system whereby traders are aiming for intermediate-term trading opportunities, and is significantly different to long-term trading.
Whichever trading style applies to you, it's important to find out, as the trading style you choose will have a profound effect on your trading outcomes and your ultimate profitability.
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😎MYTHS ABOUT TRADING BUSTED😎
⚛️The world of trading is full of myths and misconceptions. We often hear stories of overnight successes and devastating losses. It can be difficult to separate truth from fiction when it comes to trading. In this article, we will debunk some of the most common trading myths and provide the facts to help you make better investment decisions.
❌Myth: Trading is Gambling
✅Fact: Trading involves analyzing market trends, researching companies and industries, and making informed decisions based on data. Successful traders do not simply rely on luck; they systematically evaluate risk and reward before making trades.
❌Myth: You Need to be a Financial Expert to Trade
✅Fact: While a basic understanding of the market is important, you do not need a degree in finance to be a successful trader. There are numerous resources available to help beginners learn the basics of trading, including online courses, tutorials, and mentorship programs.
❌Myth: Day Trading is the Best Way to Make Money Quickly
✅Fact: Day trading involves buying and selling assets within a single trading day in order to profit on short-term price movements. While it can be lucrative, it is also risky and requires significant time and effort. Many successful traders prefer to take a long-term approach, focusing on investments that will appreciate over time.
❌Myth: You Need a Lot of Money to Start Trading
✅Fact: While having a larger investment portfolio can certainly provide more opportunities for profit, you do not need a huge amount of money to start trading. Many online brokers offer low minimum account balances, making it easier for beginners to start investing.
❌Myth: Trading is Only for the Wealthy
✅Fact: Trading is accessible to anyone with an internet connection and a willingness to learn. While high net worth individuals may have more resources to invest, anyone can start trading with a little bit of research and a willingness to take calculated risks.
❌Myth: Technical Analysis is the Only Way to Predict Market Trends
✅Fact: Technical analysis involves analyzing charts and data to predict future market trends. While it can be a valuable tool, it is not the only way to make informed trading decisions. Fundamental analysis, which involves evaluating a company's financial health and growth potential, is equally important.
❌Myth: Trading is a Solo Endeavor
✅Fact: Trading can be a solitary activity, but it is important to take advantage of opportunities to learn from and collaborate with other traders. Online forums like Tradingview, mentorship programs, and networking events can all provide valuable insights and support.
✳️In conclusion, there are many myths surrounding trading that can prevent individuals from taking advantage of its potential benefits. By separating fact from fiction, traders can make informed decisions and increase their chances of success. Whether you are a seasoned investor or a beginner, knowledge and education are essential to achieving your financial goals.
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Learn the Long History of Forex!
💶The history of the foreign exchange market (forex) dates back centuries, with evidence of currency exchange dating back to ancient civilizations. Here is a brief overview of the ancient history of forex:
• Ancient Mesopotamia: The Mesopotamians, who lived in present-day Iraq, are believed to have been the first civilization to use a form of currency. They used clay tablets to record transactions of goods and services, and it is believed that they also engaged in foreign exchange transactions.
• Ancient Egypt: The ancient Egyptians used a bartering system to trade goods and services, but they also used a form of currency in the form of metal rings. Foreign exchange transactions likely occurred between ancient Egyptian traders and merchants from other civilizations.
• Ancient China: The Chinese began using metal coins as a form of currency as early as the 7th century BC. They also engaged in foreign exchange transactions with merchants from other civilizations, such as the Greeks and Romans.
• Ancient Greece: The ancient Greeks used a bartering system to trade goods and services, but they also minted coins made of precious metals. Foreign exchange transactions likely occurred between ancient Greek traders and merchants from other civilizations.
• Ancient Rome: The ancient Romans minted coins made of precious metals, which were used as a form of currency. They also engaged in foreign exchange transactions with merchants from other civilizations.
💴It's worth noting that these ancient foreign exchange transactions were likely not as frequent and organized as they are today, and were conducted primarily through bartering or physical money exchange. The invention of paper money and the rise of banks in the Middle Ages led to the development of more organized foreign exchange markets.
💵And Here is the overview of modern history of forex:
• The modern foreign exchange market began to take shape in the 1970s, after the collapse of the Bretton Woods system, which had pegged the value of currencies to the price of gold.
• Prior to the 1970s, currency trading was primarily conducted by governments and large institutions, but with the emergence of floating exchange rates, the market became more accessible to smaller investors and traders.
• In the 1980s, electronic trading began to take hold, with the introduction of new technologies such as the Reuters Dealing 2000-2 system, which allowed traders to conduct transactions electronically. This led to a significant increase in the size and liquidity of the forex market.
• The 1990s saw the continued growth of the forex market, with the introduction of new technologies such as the internet, which made it possible for individuals to trade forex online.
• In the 2000s, the forex market saw a surge in popularity as a growing number of retail traders and investors entered the market. The introduction of online trading platforms and the ability to trade on margin further increased the market's accessibility.
💰Today, the forex market is the largest and most liquid financial market in the world, with a daily turnover of over $6 trillion. It's accessible to a wide range of participants, from large banks and institutional investors to small retail traders. The forex market operates 24 hours a day, five days a week, allowing traders to participate at any time.
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Multiple Time Frames Can Multiply Returns
In order to consistently make money in the markets, traders need to learn how to identify an underlying trend and trade around it accordingly.
Multiple time frame analysis follows a top-down approach when trading and allows traders to gauge the longer-term trend while spotting ideal entries on a smaller time frame chart. After deciding on the appropriate time frames to analyze, traders can then conduct technical analysis using multiple time frames to confirm or reject their trading bias.
Multiple time frame analysis, or multi-time frame analysis, is the process of viewing the same currency pair under different time frames. Usually the larger time frame is used to establish a longer-term trend, while a shorter time frame is used to spot ideal entries into the market.
HOW TO IDENTIFY THE BEST FOREX TIME FRAME?
Many traders, new and experienced, want to know how to identify the best time frame to trade forex. In general, traders should select a time frame in accordance with:
the amount of time available to trade per day
the most commonly used time frame utilized to identify trade set ups.
For example, day traders typically have the whole day to monitor charts and therefore, can trade with really small time frames. These range anywhere from a one-minute, to the 15-minute, to the one-hour time frame. Day traders that identify their trade set ups on the one-hour time frame can then zoom into the 15-minute time frame to spot ideal market entries.
Multiple time frame analysis usually produces high win rate, guaranteeing very limited risk.
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5 TYPES OF ELLIOTT WAVE PATTERNS Hello traders, today we will talk about 5 TYPES OF ELLIOTT WAVE PATTERNS
( FIRST SOME BASIC INFO )
What is Elliott Wave Theory?
The Elliott Wave Theory suggests that stock prices move continuously up and down in the same pattern known as waves that are formed by the traders’ psychology.
The theory holds as these are recurring patterns, the movements of the stock prices can be easily predicted.
Investors can get an insight into ongoing trend dynamics when observing these waves and also helps in deeply analyzing the price movements.
But traders should take note that the interpretation of the Elliot wave is subjective as investors interpret it in different ways.
(KEY TAKEAWAYS)
The Elliott Wave theory is a form of technical analysis that looks for recurrent long-term price patterns related to persistent changes in investor sentiment and psychology.
The theory identifies impulse waves that set up a pattern and corrective waves that oppose the larger trend.
Each set of waves is nested within a larger set of waves that adhere to the same impulse or corrective pattern, which is described as a fractal approach to investing.
Before discussing the patterns, let us discuss Motives and Corrective Waves:
What are Motives and Corrective Waves?
The Elliott Wave can be categorized into Motives and Corrective Waves:
1. Motive Waves:
Motive waves move in the direction of the main trend and consist of 5 waves that are labelled as Wave 1, Wave 2, Wave 3, Wave 4 and Wave 5.
Wave 1, 2 and 3 move in the direction of the main direction whereas Wave 2 and 4 move in the opposite direction.
There are usually two types of Motive Waves- Impulse and Diagonal Waves.
2. Corrective Waves:
Waves that counter the main trend are known as the corrective waves.
Corrective waves are more complex and time-consuming than motive waves. Correction patterns are made up of three waves and are labelled as A, B and C.
The three main types of corrective waves are Zig-Zag, Diagonal and Triangle Waves.
Now let us come to Elliott Wave Patterns:
In the chart I have mentioned 5 main types of Elliott Wave Patterns:
1. Impulse:
2. Diagonal:
3. Zig-Zag:
4. Flat:
5. Triangle:
1. Impulse:
Impulse is the most common motive wave and also easiest to spot in a market.
Like all motive waves, the impulse wave has five sub-waves: three motive waves and two corrective waves which are labelled as a 5-3-5-3-5 structure.
However, the formation of the wave is based on a set of rules.
If any of these rules are violated, then the impulse wave is not formed and we have to re-label the suspected impulse wave.
The three rules for impulse wave formation are:
Wave 2 cannot retrace more than 100% of Wave 1.
Wave 3 can never be the shortest of waves 1, 3, and 5.
Wave 4 can never overlap Wave 1.
The main goal of a motive wave is to move the market and impulse waves are the best at accomplishing this.
2. Diagonal:
Another type of motive wave is the diagonal wave which, like all motive waves, consists of five sub-waves and moves in the direction of the trend.
The diagonal looks like a wedge that may be either expanding or contracting. Also, the sub-waves of the diagonal may not have a count of five, depending on what type of diagonal is being observed.
Like other motive waves, each sub-wave of the diagonal wave does not fully retrace the previous sub-wave. Also, sub-wave 3 of the diagonal is not the shortest wave.
Diagonals can be further divided into the ending and leading diagonals.
The ending diagonal usually occurs in Wave 5 of an impulse wave or the last wave of corrective waves whereas the leading diagonal is found in either the Wave 1 of an impulse wave or the Wave A position of a zigzag correction.
3. Zig-Zag:
The Zig-Zag is a corrective wave that is made up of 3 waves labelled as A, B and C that move strongly up or down.
The A and C waves are motive waves whereas the B wave is corrective (often with 3 sub-waves).
Zigzag patterns are sharp declines in a bull rally or advances in a bear rally that substantially correct the price level of the previous Impulse patterns.
Zigzags may also be formed in a combination which is known as the double or triple zigzag, where two or three zigzags are connected by another corrective wave between them.‘
4. Flat:
The flat is another three-wave correction in which the sub-waves are formed in a 3-3-5 structure which is labelled as an A-B-C structure.
In the flat structure, both Waves A and B are corrective and Wave C is motive having 5 sub-waves.
This pattern is known as the flat as it moves sideways. Generally, within an impulse wave, the fourth wave has a flat whereas the second wave rarely does.
On the technical charts, most flats usually don’t look clear as there are variations on this structure.
A flat may have wave B terminate beyond the beginning of the A wave and the C wave may terminate beyond the start of the B wave. This type of flat is known as the expanded flat.
The expanded flat is more common in markets as compared to the normal flats as discussed above.
5. Triangle:
The triangle is a pattern consisting of five sub-waves in the form of a 3-3-3-3-3 structure, that is labelled as A-B-C-D-E.
This corrective pattern shows a balance of forces and it travels sideways.
The triangle can either be expanding, in which each of the following sub-waves gets bigger or contracting, that is in the form of a wedge.
The triangles can also be categorized as symmetrical, descending or ascending, based on whether they are pointing sideways, up with a flat top or down with a flat bottom.
The sub-waves can be formed in complex combinations. It may theoretically look easy for spotting a triangle, it may take a little practice for identifying them in the market.
Bottomline:
As we have discussed above Elliott wave theory is open to interpretations in different ways by different traders, so are their patterns. Thus, traders should ensure that when they identify the patterns.
This chart is just for information
Never stop learning
I would also love to know your charts and views in the comment section.
Thank you
Building Your First Trading Plan | Step By Step Guide
📖What is a trading plan?
A trading plan is a comprehensive decision-making tool for your trading activity. It helps you decide what, when and how much to trade. A trading plan should be your own, personal plan – you could use someone else’s plan as an outline but remember that someone else’s attitude towards risk and available capital could be vastly different to yours.
📚Why do you need a trading plan?
You need a trading plan because it can help you make logical trading decisions and define the parameters of your ideal trade. A good trading plan will help you to avoid making emotional decisions in the heat of the moment.
✳️TRADING PLAN CREATION STEPS:
1️⃣Outline your motivation
Figuring out your motivation for trading and the time you’re willing to commit is an important step in creating your trading plan. Ask yourself why you want to become a trader and then write down what you want to achieve from trading.
2️⃣Decide how much time you can commit to trading
Work out how much time you can commit to your trading activities. Can you trade while you’re at work, or do you have to manage your trades early in the mornings or late at night?
If you want to make a lot of trades a day, you’ll need more time. If you’re going long on assets that will mature over a significant period of time – and plan to use stops, limits and alerts to manage your risk – you may not need many hours a day.
It's also important to spend enough time preparing yourself for trading, which includes education, practising your strategies and analysing the markets.
3️⃣Define your goals
Any trading goal shouldn’t just be a simple statement, it should be specific, measurable, attainable, relevant and time-bound (SMART). For example, ‘I want to increase the value of my entire portfolio by 15% in the next 12 months’. This goal is SMART because the figures are specific, you can measure your success, it’s attainable, it’s about trading, and there’s a time-frame attached to it.You should also decide what type of trader you are. Your trading style should be based on your personality, your attitude to risk, as well as the amount of time you’re willing to commit to trading.
4️⃣Choose a risk-reward ratio
Before you start trading, work out how much risk you're prepared to take on – both for individual trades and your trading strategy as a whole. Deciding your risk limit is very important. Market prices are always changing and even the safest financial instruments carry some degree of risk. Some new traders prefer to take on a lower risk to test the waters, while some take on more risk in the hopes of making larger profits – this is completely up to you.
It is possible to lose more times than you win and still be consistently profitable. It's all down to risk vs reward.
5️⃣Decide how much capital you have for trading
Look at how much money you can afford to dedicate to trading. You should never risk more than you can afford to lose. Trading involves plenty of risk, and you could end up losing all your trading capital (or more, if you are a professional trader).
Do the maths before you start and make sure you can afford the maximum potential loss on every trade. If you don't have enough trading capital to start right now, practise trading on a demo account until you do.
6️⃣Start a trading diary
For a trading plan to work it needs to be backed up by a trading diary. You should use your trading diary to document your trades as this can help you find out what’s working and what isn’t.You don’t only have to include the technical details, such as the entry and exit points of the trade, but also the rationale behind your trading decisions and emotions. If you deviate from your plan, write down why you did it and what the outcome was. The more detail in your diary, the better.
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Drunk Newbie Cypher correction.Silly old me drew the cypher harmonic wrong! Thankyou for the help and correction @FinanciallyCodependently , appropriate it! this is why I love Tradingview!
The Mistake:
Made the B-D 0.786 when it should be X-D as 0.786 and B-D is irrelevant
The Cause:
I shouldnt draw fib harmonics after a few too many 🍻🤣
Updated chart here!
The correct cypher also makes my target range more like my original confluence area 🔥
MUST READ:ETHUSDT AFTERETHUSDT Went as Anticipated few hours ago i shared an idea.Price moved as predicted..
Follow for more ideas.
Trading Psychology: How Does Your Mind Matter In Making Money?Hello traders, today we will talk about Trading Psychology
The most famous book on trading psychology, “Tradingpsychologie” aptly remarks, ‘The greatest enemy of the trader is fear. He who is afraid loses!’.
As a trader, you must have gone through emotions such as fear, greed, regret, hope, overconfidence, doubt, nervousness etc.
While every trader goes through this emotional rollercoaster, a successful trader knows that it’s never a good idea to let your emotions influence your investment decisions.
Not letting your emotions affect your trading decisions is the real meaning of trading psychology!
In this article, we will educate you on the meaning of trading psychology. We will also reveal trading tips and tricks to mentally prepare you to trade with confidence!
So, let’s begin!
What is Trading Psychology?
Trading psychology or investor psychology refers to the trader’s emotional and mental state which dictates their trading actions.
Some of these emotions like hope, confidence are helpful and should be embraced. But emotions like fear and greed must be contained. Another emotion that is very common in financial markets is the fear of missing out or FOMO.
It is essential to understand and develop a sharp mindset along with knowledge and experience to become a successful trader.
Let us take a look at the various psychological factors that affect a trader’s mindset and some pro-tips to deal with them.
1. Fear
Fear is a natural reaction that we sense when something is at risk. While trading, risks could occur in many forms –
Some bad news about the stocks or the market
Placing a trade and realising it’s not going the way you had hoped
Fear of loss of capital
Traders generally overreact and tend to liquidate their holdings because of fear. A strong trading psychology is when traders do not let fear dictate their buy/sell strategy.
What should you do?
Every trader must first understand what they are afraid of and why? Reflect on these issues ahead of time so you can quickly identify the problem and find a solution. Your focus should be to not let the fear of loss refrain you from making profit.
2. Greed
Greed enters when you desire excess profits. Rome was not built in a day and neither will your stock market fortune. If you find yourself on a winning streak, then book your profits and move on. Majority of the time, your greed will turn a winning streak into a disaster!
What should you do?
To combat greed, you should have a predefined profit booking level. Even before you enter a trade, define your stop-loss and book-profit levels to avoid being swayed by greed.
A sound trading psychology is when you are content with your profits and do not chase irrational profits.
3. Regret
Regret in trading comes in two ways.
A trader could regret placing a trade that didn’t work or
Regret not placing a trade that could have worked.
A trading psychology based on regret can be dangerous for a trader as it may result in placing wrong trades.
What should you do?
The best way to avoid a regretful trading psychology is to accept that you can’t have all the opportunities in the market. The equation in the stock markets is very simple – You win some; you lose some.
Once you accept this rule, your trading psychology will automatically change for the better.
4. Hope
Investors often think that trading is gambling. It’s because they hope to win all the time and when they don’t, they get dejected.
What should you do?
To become a successful trader, you must have a solid trading psychology which is not dependent on hope. If you keep hoping for things to change in the near future, you’re putting your entire investment at risk.
Don’t let hope keep you invested in a loss making trade. Be practical, and book your losses at the correct time.
To attain and maintain success as a trader, you have to work hard to cultivate a mindset! Let’s see how trading psychology helps you cultivate a better mindset!
How to Improve Your Trading Psychology
1. Get Yourself in the Right Mindset
Before you even start your trading day, simply remind yourself that markets are never constant. You will have some good days and some bad days, but the bad days too shall pass.
Another effective strategy to improve your trading psychology is to give yourself time. You are not going to make a fortune on your very first trading day. You need to spend time and efforts in creating a rock solid trading strategy which isn’t affected by the market sentiments.
While you cannot completely eliminate emotions from trading, the goal is to reduce the extent of emotions controlling your trading psychology.
2. Have a Great Knowledge Base
One of the best ways to improve your trading psychology is to increase your knowledge and trading skills. Having a strong knowledge base of the stock market is key to defeating negative trading psychology. Remember, knowledge is power!
3. Remind yourself that you are Trading in Real Money
When you’re trading online, it’s easy to forget that the numbers on your screen actually represent real money. There’s nothing wrong in risking your money in hopes of generating returns. But remember to be cautious and make smarter investment decisions.
4. Observe the Habits of Successful Traders
Stock market is unique because it treats each trader differently. When it comes to trading, you should be aware of what your peers are doing, not to copy them but to learn from them.
By observing the positive characteristics of successful traders and inculcating few habits or strategies into your own trading, you can improve your trading strategies manyfolds.
5. Practice! Practice! Practice!
Last but not the least, practice is the best and most reliable way to gain mental strength. It helps you improve your trading psychology over time as you build well practised trading strategies and are well prepared for any ups or downs.
Final Thoughts
Understanding trading psychology and implementing it is a time consuming process. You have to continuously refine your trading psychology over long time periods.
To sum up, remember these three golden principles of trading psychology
Be disciplined
Be flexible
Never stop learning
I would also love to know your charts and views in the comment section.
Thank you
Path to AltseasonHello traders, today we will talk about Path to Altseason
BASIC INFO
Altcoin season, or ‘Altseason’, is the home of face-melting gains & high volatility. It’s pretty much Christmas for crypto traders.
Within a brief period (usually a few weeks or months), the prices of altcoins (all coins besides Bitcoin) skyrocket as investors move their money out of Bitcoin and into other cryptocurrencies.
Once prices start to rise, FOMO investment kicks in, causing a snowball effect which drives altcoin prices even higher to astronomical (and often overvalued) heights for a short period of time.
Many investors can make the majority of their profits for the year during an Altseason if they are able to sell their altcoins before Alts
Bitcoins & Altseason
Put simply, Altseason begins when altcoins start to outperform Bitcoin (when prices of alts rise in comparison to Bitcoin), and Altseason ends when Bitcoin outperforms altcoins.
However, this does not mean that when Bitcoin’s price goes down alts automatically go up. In fact, historically, Bitcoin has tended to lift altcoins when it rises and also bring them down after a major crash, with the price of Bitcoin and altcoins often being closely correlated. Previous bull markets have generally seen Bitcoin enjoy an uptrend before altcoins join the wave and head for the moon.
Key Takeaways
An altcoin is simply any other cryptocurrency that is not Bitcoin. They are usually more volatile than Bitcoin, offering high-risk high-reward opportunities.
When Bitcoin dominance (the amount of the total crypto market share held in Bitcoin) declines rapidly, it leads to an increase of investments in Altcoins, which causes an Altseason.
Predicting Altseason is not an exact science, and it is not something that’s officially announced at a certain time or date.
An Altseason can occur several times a year and they often happen within a relatively short period of time.
For maximum gains it’s crucial to sell your altcoins before Altseason is over. Alt’s prices drop just as quickly as they rose.
There have been many Altseasons in the last decade, with all of them beginning right after Bitcoin dominance declined.
The sharper the decline in BTC dominance the bigger the Altseason.
How to take advantage of Altseason?
The key to taking advantage of Altseason is to have your money in altcoins before Altseason begins, or just as it is beginning. Pay close attention as prices begin to rise, and make sure you sell out from most of your positions before Altseason ends and prices fall as quickly as they rose – don’t worry about trying to sell at the very peak, just take profits on the way up and be ready for things to end as quickly as they begun!
Top tips for navigating Altseason
Altseason is often the most lucrative time during a crypto market cycle, however, it is also the most volatile time. As the potential for gains rises so does your risk. Here are some tips to keep in mind during an Altseason:
Altseason is both an exciting and emotional time. If you’re a new investor, proceed with caution. Separating your investment decisions from your emotions is a tried-and-tested strategy for mitigating risk and maximising profits.
Having a solid exit strategy prepared will decrease the chances of you HODLing your alts through the peak only to see them fall when Altseason comes to an end.
Depending on your commitment level, spreading yourself too thin by investing in lots of altcoins can be confusing and difficult to keep track of. A bit of diversification is always good but don’t invest in more coins than you can keep track of!
Accept that you cannot be involved in every pumping altcoin. Choose your best picks and stay up to date on the relevant news and market movements.
Be sure to take profits on the way up to ensure that you realise most of your gains before prices come back down again. If you get a sizeable gain, you may want to reduce your position before the inevitable price correction!
Using your profits from Altseason to reinvest into Bitcoin while it is at a good price (and vice versa) is a popular strategy.
Risk management is the best way to make the most out of Altseason, given the sheer number of investment opportunities that will arise. Never risk so much that you won’t be able to keep playing – there can be multiple Altseasons in a year!
The key to taking advantage of Altseason is to have your money in altcoins before Altseason begins, or just as it is beginning. Pay close attention as prices begin to rise, and make sure you sell out from most of your positions before Altseason ends and prices fall as quickly as they rose – don’t worry about trying to sell at the very peak, just take profits on the way up and be ready for things to end as quickly as they begun!
The Altcoin Season Index is a helpful (but not exact) tool to see where we are in relation to Altseason. According to the Altcoin Season Index, if 75% of the Top 50 altcoins performed better than Bitcoin over the last season (90 days), it is Altcoin Season.
They also give an indication of where we are in terms of an Altcoin Month or Year, with an easy to interpret graph that shows the general long-term trends of previous Altseasons.
Altcoin season is not something that’s officially announced at a certain time or date. Nobody knows for sure when it’s upon us, nor when it will end. All we have are certain indicators that can help us know if we have entered Altseason.
Why does Altseason see such huge gains?
FOMO and the snowball effect play a big part. Part of the reason Altseason sees such a dramatic rise in prices is because many new investors see prices beginning to rise, and immediately invest out of FOMO.
This creates a snowball effect which pushes prices higher and higher until they are overvalued and in a bubble. When people realise they are riding a precarious rollercoaster that may crash at any moment, they begin to sell. This causes panic which leads to more mass selling and the price plummeting back down to earth, bringing Altseason to an abrupt end.
When is the top of Altseason/the bull market?
The million-dollar question that no-one can really answer. While crypto markets follow cycles which can be predicted based on past market movements, every bull run is different and it is incredibly difficult predict the very top of Altseason, or any bull run for that matter.
Given the fact that no-one really knows exactly when the top of the bull run or Altseason will be, it is wise to take profits along the way as your portfolio gains value. Dollar-cost-average selling (DCA) can be useful to minimise the impact of the market’s volatility while you invest.
If Bitcoin’s price goes up will altcoins also go up?
Generally, yes. The price of most altcoins is highly correlated with the price of Bitcoin. It is Bitcoin dominance, however, that indicates when Altseason is beginning.
Why are altcoins dependent on Bitcoin?
A major reason that altcoin’s and Bitcoin’s prices are so highly correlated is that many altcoins are purchased with Bitcoin. Bitcoin is often bought before the purchase of an altcoin, pushing the price of both coins up.
Similarly, if someone wants to cash out on an altcoin, many exchanges require you to first sell that altcoin for Bitcoin, and then sell the Bitcoin for cash, which pushes both prices down at the same time.
Another reason the prices are highly correlated is simply because they’re in the same asset class and things that are in the same asset class tend to go up and down together.
What to look out for to predict an Altseason
The most important thing would be a decrease in Bitcoin dominance, usually occurring after an exponential increase and subsequent consolidation. Additionally, relative trade volume, social media activity, mainstream interest, new coin listings and the volume of news articles published from crypto projects seem to be good indicators of when Altseason might be approaching.
What is Ethereum’s relationship to Altseason?
Ethereum, seen as the second most trusted cryptocurrency and the silver to Bitcoin’s gold, is at the heart of the altcoin market. The start of bullish moves for Ethereum is often the start of Altseason, especially with so many alts and DeFi projects being built on top of the Ethereum Blockchain.
Generally, after Bitcoin rallies upwards and consolidates, Ether’s price will also need to break out before altcoins can see a sizable rally.
Can altcoins lift Bitcoin?
Not really. Bitcoin rarely gets boosted by altcoins.
Generally, once altcoins have pumped and claimed dominance from Bitcoin, the steps in to take back the bulk of the crypto market share, marking the end of Altseason.
What is an example of Bitcoin Dominance influencing Altseason?
On December 9, 2017, Bitcoin Dominance had gone from 69% to 37% in the space of just 35 days (which means it went from owning 69% of the total crypto market share to 37% in just over a month).
Looking at the Altcoin market cap chart, December 9 coincides exactly with the beginning of the largest Altseason that crypto had ever seen. The sharper the decline in Bitcoin Dominance, the bigger the spike in Alts.
History also repeated itself on March 30, 2018 when a sharp decline in Bitcoin Dominance from 50 to 38 in 40 days led to a significant increase in the Altcoins market cap.
What have previous Altseasons and bull runs taught us?
Previous bull runs and Altseasons suggest that larger-cap altcoins (starting with Ethereum) pump before smaller-cap altcoins begin moving up. This usually happens after Bitcoin has had a big move up, followed by some sideways movement, causing investors to seek gains in altcoins, thus decreasing Bitcoin dominance and starting the party that is Altseason.
IMPORTANT
BTC Rises - Altcoins Not Rising
BTC drops - Altcoins Super Drop
The scenario is confirming this - Be sure to survive before Altseason arrives
Never stop learning
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MUST READ:GER 30 CURRENT VIEWPrice Broke The Lower High and And Created a New Higher which signals buying opportunities telling us that the price is currently Bullish from being bearish as I identified the zone indicated and took 50 % of the zone to reduce risk as we wait for price to retrace back to the identified level and take our positions.
Bear In mind that i use smart money concepts that's why my charts may not contain many objects e.g Trendlines,Indicators. etc
#BTC ready to go long, pay attention!Hi guys, This is CryptoMojo, One of the most active trading view authors and fastest-growing communities.
Consider following me for the latest updates and Long /Short calls on almost every exchange.
I post short mid and long-term trade setups too.
Let’s get to the chart!
I have tried my best to bring the best possible outcome to this chart, Do not consider financial advice.
#BTC WEEKLY UPDATE
This big falling wedge pattern is still in the pay.
(basics info)
what is a falling wedge pattern?
The falling wedge is a bullish pattern. Together with the rising wedge formation, these two create a powerful pattern that signals a change in the trend direction. In general, a falling wedge pattern is considered to be a reversal pattern, although there are examples when it facilitates a continuation of the same trend.
> Important support level is 25k
> BTC Needs to close this weekly candle above $25400
> The volume is increasing, which is a characteristic of a third wave. We could expect a strong bull run in the market as many indicators are showing.
> $25K will now act as strong support as it is broken after large accumulation and will likewise offer great opportunities in case of retracement.
Stay tuned I will keep updating
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Learn What is Confirmation Bias | Trading Psychology 🧠
In this educational article, we will discuss one of the most common cognitive errors of newbie traders - a confirmation bias.
In order to better understand that term, I want to start with the example:
Let's say that after doing some research, you are highly convinced that Bitcoin is bullish and that it is a decent investment.
You decide to buy that from 50.000 level, expecting the exponential growth.
Instead of growing, however, the market starts falling rapidly.
Rather than closing your position in loss, you decide to do a new research and execute the analysis, you start looking for the proof of your pre-existing beliefs. You completely neglect the voices of Bitcoin sceptics and ignore bearish clues on the price chart.
You consider only the facts that support a bullish outlook, not letting you accept the other point of view.
You become a victim of a confirmation bias.
Unfortunately, such a psychological trap frequently prevents a closing of a trading position in time, leading to substantial losses.
Confirmation bias is a common psychological error that makes a subject overvalue the information that upholds his existing beliefs and undervalue the opposing one.
Here are the most common symptoms of that trap:
1️⃣One is neglecting the objective facts.
2️⃣One is interpreting information in a way to support the existing beliefs.
3️⃣One is considering only the facts that conform with his point of view.
4️⃣One is completely ignoring the information that challenges his beliefs.
The only way to beat a confirmation bias in trading, is to learn to analyze the market from sellers' and from buyers' perspective. Your task is to compare the view of the 2 sides, and pick the one that is stronger, holding in mind the fact that everything can change.
You should always remember of the changing nature of financial markets and be ready to always reassess your views.
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10 Rules of Risk Management
Risk management is the most important aspect of any trading plan. Apart from the mathematical and strategic methodologies to employ, there are several precautions you can adopt as a trader and consider in your decision-making process.
Never risk more than you can afford to lose.
Never forget Rule no.1.
Stick to your trading plan.
Consider the costs like spread, rollover/swap and commissions.
Limit your margin use and track available margin to avoid margin calls.
Always use Take Profit and Stop Loss orders.
Never leave open positions unattended.
Record your performance and adjust as you progress.
Avoid high volatility periods like economic news releases.
Avoid making emotional decisions when trading.
We apply risk management to minimise losses if the market tide turns against us after an event. Although the temptation of realising every opportunity is there for all traders, we must know the risks of an investment in advance to ensure we can endure if things go sour. All successful traders know and accept that trading is a complex process and an extensive risk management strategy and trading plan allow us to have a sustainable income source.
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USDT DOMINANCE MADE A RISING WEDGE PATTERN!!Hi guys, This is CryptoMojo, One of the most active trading view authors and fastest-growing communities.
Consider following me for the latest updates and Long /Short calls on almost every exchange.
I post short mid and long-term trade setups too.
Let’s get to the chart!
I have tried my best to bring the best possible outcome to this chart, Do not consider financial advice.
#USDT DOMINANCE UPDATE
USDT DOMINANCE made this rising wedge pattern in the daily time frame and currently looks like it's retesting it.
if it retests it successfully then we can expect a good bounce in alts it also indicting towards the Bullrun.
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