Over the years, the crypto market has not been without hitches on having a perfect prediction by different traders as seen by different traders.
The rate at which the market fluctuates has come under criticism that the market is grossly manipulated by anonymous investors. The different market psychologies which includes Fear, greed, excitement, overconfidence, nervousness etc when exquisitely handled will prop in masterminding and maneuvering the crypto trading space without much losses.
Focal point for trading
There are different things to look out for while engaging in trade, and I will be discussing some of them below.
Trade management:
Proper trade management system is a prerequisite for mitigating against unfavorable trades, and one may ask what this entails.
This is the limit where a trader decides exactly the position his trade should not be exceeding. For instance in a bull trend, One goes into trade when Hive is valued at $0.475 and hence decides that if the price gets to 0.48 it should automatically sell or if the price depreciates to $0.46 it should also sell.
Proper trade management emphasizes more on price mechanism, that is a trader trying to mitigate against loss either in a bull or bear trend by adjusting to reasonable price positions. So when a good trade management is set, the trader is rest assured of trading at the least minimal risk and an optimum gain position, since the position of his take profit is actually at his desired level.
Time frame.
This is another important factor to be considered while trading in futures or CFD as a trader. It is best advisable to use a lesser time frame than a lengthier one for instance, you can deploy 3 to 5 min. time frame based on the provision of time availed on the exchange.
My emphasis on time factor is that a while trading with a shorter time frame, you can easily observe the current trend of the market but if a trader uses a longer time frame like 10 min and above, there is the possibility that he might be at the wrong trend and probably may encounter some loss due to the rate of market volatility.
It is best advisable to trade using 5min on either the bull or bear trend market so as to permit a trader in seeing the current market performance.
The application of credible Indicator(s)
Indicators play a requisite role in trading although they might not capture all the market performance of a coin because of the rate of volatility but it has the potential of giving about 70% market prediction about a trend going bearish or bullish.
It is best to get acquainted with a particular indicator that can easily be used throughout your trading period if you cannot spot the trend by instinct.
I really love trading using the MACD because of the utility I have gained from it so far, and how exquisitely it has performed overtime although there are many indicators out there but amongst my frequently used indicators is the MACD.
Trading on the trend.
This is the most important aspect about trading. There is no perpetual trend in the market, meaning that there will never be a market trend that will never elapse whether it's a bull or bear trend.
Following a particular trend is very important in trading. When the trend is bullish, it is best advisable to stay put entering trades after a market reversal from the bear or after a consolidation from the bottoms since there will always be some spot of short downtrends despite having a strong bull trend.
The fact is that since the emphasis is on future and CFD trading, we have to also particularize on short entries and exit positions because of the rate of volatility involved in crypto trading in general as to properly maximize profits.
Conclusion
Future or CFD trading isn't without risk as every professional trader really understands the gimmick behind this system.
As earlier stated, the use of short time frames are very important coupled with the use of good indicators, trading in a particular trend and properly setting good trade management positions. All these are key to instigating massive profit while trading futures or CFD.
Thanks for going through my publication for today, hope you enjoyed reading. I promise to keep a good track on trading so that many traders in the system will also share in my experience, a more practical view in subsequent articles, bye and see you in my next publication.