A few days ago I told you people about a very good strategy where you can easily trade in silver and gold and that too in the form of an index. For those who are new to this post for their ease I will give a short explanation about index.
Index means a collection of more than one coin. Like in the stock market you can see that a group of 30–40 shares is called an index which traders can trade. What is the benefit of making an index?
Its biggest benefit is that you are saved from volatility, you get an easy way of trading and your risk stays low. Meaning a stable market is presented as an index which helps in your trading.
I made a silver and gold index where on one side we long silver and short gold and in the other account we long gold and short silver. When a difference of 1–2% comes between them then we close one and hold the other. As soon as the gap difference finishes it gives you profit and you have to book it.
In case the loss keeps increasing then after every 2% you keep investing in 3–4 layers and by trading on every layer you keep doing profit booking. At the end of the day you will see that your portfolio has gone into profit.
To further fine tune this strategy another plan came to my mind and that is RSI based trading strategy. What you have to do is only track the RSI of silver and whenever you see that silvers RSI reaches 70, at that time you have to short silver and at the same time long gold.
Now you have to wait. As soon as RSI is 70 it is a sign of overbought so from here there are more chances that price will drop and you will do your profit booking. In case if it goes from 70 to 80 then we will invest our second layer again by shorting silver and longing gold.
If it increases more and goes to 85 then it is an extreme overbought positio and from here a retracement will definitely come and after investing the third layer it is time for profit booking.
And whenever RSI comes to 30, at that time you have to long silver. Similarly if RSI comes to 25 or 20 then invest your second and third layers as well.
Now many people will have this question that what is the benefit of index if you only have to see silver RSI. The big benefit is that we are taking gold only as a protection trade while the real movement is of silver.
Silver is much faster in trading than gold. If it goes up it increases 2–3 times more than gold and if it is bearish it also falls more than gold. That is why we focus on silver and we only keep gold as a protection hold.
This is a very good strategy which you can apply and start proper profit taking. If you understand this strategy, then share your opinion in the comment section and if there is any confusion then you can also ask me in the comments.
I hope you guys will like this post and is interesting as well. If you find it informative then dont forget to give me a support. Share you reviews in the comment section below. Thank you all for your time reading the content.
TWITTER TELEGRAM HIVE WHATSAPP DISCORD
IMAGES SOURCES
1
