Welcome back to Coinstune.com, your trusted resource for navigating the exciting world of cryptocurrency trading! If you’re new to the trading game, it’s easy to get overwhelmed by the complexities and nuances of the market. Fear not! Here’s a straightforward guide with some quick and practical rules to help you get started and build a solid foundation for your trading journey.
1. Trade Lower Time Frames (LTF)
Practice a lot. Keep clicking. Learn from high iteration.
Trading on lower time frames like 1-minute or 5-minute charts allows you to make numerous trades and gain valuable experience quickly. The more you practice, the better you’ll understand the market’s behavior and develop your trading skills.
2. Start with Using Fixed Range Volume Profile (FRVP)
Try sticking to it.
The Fixed Range Volume Profile is a powerful tool for understanding where the majority of trading activity has occurred over a specific period. By focusing on FRVP, you can identify key levels of support and resistance, helping you make more informed trading decisions.
3. Don’t Trade Breakouts
Don’t Buy All-Time Highs (ATH) or Range Highs.
Avoid the temptation to buy during breakouts or at the top of a range. These moves can be deceptive and often lead to losses. Instead, look for safer entry points within established ranges.
4. Stick to 5-Minute Charts for Day Trading
Use 1-Minute as an Indicator.
For day trading, the 5-minute chart is your best friend. It provides enough data to make informed decisions without overwhelming you. Use the 1-minute chart as a supplementary indicator to fine-tune your entries and exits.
5. Find the Trend on Daily or 4-Hour Time Frames
Trade in that trend. Example: Don’t try to short when the higher time frame (HTF) is bullish.
Always align your trades with the prevailing trend on higher time frames like the daily or 4-hour chart. If the overall trend is bullish, avoid taking short positions and vice versa.
6. Use the 1-Hour 55 EMA as Mean
The 55-period Exponential Moving Average (EMA) on the 1-hour chart can act as a mean or average price level. Use it to identify potential areas of support or resistance.
7. Study Volume and Buy/Sell Liquidation Events
Understanding volume and liquidation events can give you insights into market sentiment and potential price movements. High volume often precedes significant price changes, while liquidation events can signal reversals or continuations.
8. Don’t Move Your Stop Loss (SL)
Your stop loss is there to protect you from significant losses. Moving it can expose you to greater risk and lead to larger losses. Set it and forget it.
9. Know Your Exit Before You Enter
Most important.
Always have a clear exit strategy before entering a trade. Whether it’s a target profit level or a stop loss, knowing when to exit helps you manage risk and emotions.
10. Stick with 1-2 Pairs for the First Few Months
Focusing on just one or two trading pairs allows you to become more familiar with their behavior and nuances. It’s better to master a few pairs than to spread yourself too thin.
11. Start with Small Capital
Test all tools. Use this as tuition fee.
Begin with a small amount of capital to test different tools and strategies. Think of it as paying for your education in trading. This approach minimizes risk while you learn.
12. Cut Losses Immediately
Don’t hold onto losing trades in the hope that they’ll turn around. Cutting losses quickly helps preserve your capital and keeps your losses manageable.
13. If You’re Nervous, Decrease Your Trading Size
If you find yourself feeling anxious or nervous about a trade, it’s a sign to reduce your position size. Smaller trades can help you stay calm and make better decisions.
Trading can be a thrilling and rewarding experience, but it requires discipline, patience, and continuous learning. By following these quick and practical rules, you’ll be better equipped to navigate the markets and build a strong foundation for your trading career.
Stay tuned to Coinstune.com for more tips, insights, and updates on cryptocurrency trading. Happy trading, and may the markets be ever in your favor!
