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Eductional

Bitcoin major sign of Stop loss hunting and dump seen!!!This is educational post and i am making it short this time with one example which happened at 13/Jan/2025 as you can see previous time we had same scenario but they did hit stop loss of sellers + buyers and how is that ? price was breaking 90K$ support zone which is strong and major support for BTC in lower time frames as you can see at that time and it breaks that immediately after hitting so many stop loss of buyers below 90K$ and get them out of their buy positions it pumped and start to rise also it hit so many stop loss of sellers with high leverage which sell the Bitcoin below that support zone and they were looking for the upcoming dump after breakout but it didn't happen and both sides get loss and someone's loss is some others profit and this high volume there is reason of that and after price pump above we can see more gain also appear due to that good stop loss hunting and it seems that we have the same scenario now happening but this time it seems that Resistance and ATH resistance zone is breaking so take care. How to find out if the breakout is valid or is it fake breakout ? 1. let it breaks the resistance or support with at least +-3% as confirmation. 2. after breakout wait for retest of breakout and let it retest previous support for example and see if it turns to resistance zone this time. 3. high volume is needed after 2-3 next candles after breakout + breakout candle. I think we may have another fake breakout and soon price will fall and dump hard and this is my thoughts. So always do your own research and DISCLAIMER: ((trade based on your own decision)) <>
Education
by MMBTtrader
25
The Psychology behind the OverconfidenceHave you ever been convinced that your next trade was destined to succeed, only to watch it go south? Overconfidence is a prevalent obstacle in trading, affecting both novices and veterans alike. Research indicates that traders who feel a high level of control over market dynamics are often the ones who incur substantial losses due to erroneous decisions. Overconfidence manifests when traders inflate their perception of their skills, market knowledge, or ability to forecast price movements. This dangerous mindset can blind them to lurking risks and lead to impulsive decisions. While confidence can be a positive trait when rooted in careful analysis and experience, overconfidence typically arises from emotional biases and previous successes. In an unpredictable market, managing overconfidence is crucial for a sustainable trading journey. Understanding Overconfidence in Trading Overconfidence in trading refers to the tendency of traders to believe they possess superior abilities in predicting market behavior. Unlike constructive confidence, which is born from experience and diligent decision-making, overconfidence is a cognitive bias that creates the illusion of enhanced control and skill. This self-delusion can be especially harmful in volatile markets where outcomes can shift unexpectedly. Traders who fall into the trap of overconfidence often assume they can consistently "outsmart" the market based on a few prior successes or assumptions. This can lead to a reckless disregard for risks, such as underestimating potential market downturns or ignoring crucial economic indicators. The impact of overconfidence on decision-making is significant. It clouds a trader’s judgment, prompting hasty actions rather than careful evaluations. Instead of thoroughly analyzing market data or considering a range of perspectives, overconfident traders often rely on gut instincts, frequently without backing their decisions with technical or fundamental analysis. As a result, they might enter high-risk trades without an appropriate risk assessment, leading to avoidable trading errors and considerable losses, especially during rapid market shifts. How Overconfidence Impacts Trading Performance The detrimental effects of overconfidence on trading performance are multi-faceted and primarily encourage heightened risk-taking. One of the clearest signs of this tendency is the tendency to increase position sizes. Overconfident traders, convinced they have a distinct advantage, may take on larger positions than their risk appetite allows, exposing themselves to greater potential losses if the market moves against them. The allure of leveraging can amplify both gains and losses, and excessive leverage can lead to margin calls, resulting in forced position liquidations. Overconfidence can also lead traders to disregard essential market signals. Such traders may overlook technical and fundamental analysis in favor of their instincts or previous successes. For instance, a trader might open a position even when indicators suggest a decline, purely because of their strong conviction. This tendency can result in them holding onto losing trades for too long, hoping for a reversal when the market's trajectory might not support such optimism. Over time, this behavior can accumulate losses and negatively impact overall profitability. Ultimately, overconfident traders become less adaptable, often resistant to acknowledging their mistakes. This rigidity and the failure to adhere to a disciplined trading strategy can deplete the gains achieved during fortunate periods, leading to inconsistent performance and in some cases, catastrophic financial repercussions. Psychological Triggers Behind Overconfidence Several psychological factors contribute to overconfidence in trading. Success bias and confirmation bias are two of the most prominent. Success bias occurs when traders experience a successful streak, leading them to believe their strategies or skills are foolproof. This temporary success can create a misleading sense of invulnerability, causing traders to take excess risks, overlook critical market signals, or stray from their established trading plans. The thrill of achievement can obstruct the ability to see potential pitfalls. Confirmation bias compounds these issues by shaping how traders process information. Overconfident traders tend to seek and interpret information that aligns with their existing beliefs, discarding any contradictory data. For example, if a trader has a steadfast belief in the potential of a particular asset, they may only focus on favorable news or indicators, ignoring negative developments. This selective analysis reinforces their overconfidence, leading to poor judgment and increased exposure to risk. Understanding these psychological triggers is key for traders who wish to keep their overconfidence in check and enhance their trading acumen. By recognizing the influences of success bias and confirmation bias, traders can actively take steps to mitigate their impact, fostering a more disciplined and analytical trading approach. Cautionary Tales of Overconfidence in Trading Real-world examples of overconfidence in trading serve as sobering reminders for traders at all experience levels. One notable case is Jesse Livermore, a renowned trader from the early 20th century. Livermore achieved significant profits through his exceptional ability to predict market trends. However, after experiencing considerable success, he developed an overinflated sense of his capabilities, prompting him to engage in reckless trading decisions. This overconfidence ultimately led him to invest heavily in stocks just before the 1929 market crash, resulting in devastating financial losses. His story highlights that even the most skilled traders can succumb to overconfidence, underscoring the importance of discipline and humility. Another cautionary tale is that of Nick Leeson, who orchestrated the downfall of Barings Bank in the late 1990s. Initially praised for his trading skills, Leeson’s overconfidence burgeoned after a series of successful trades. This hubris drove him to employ unauthorized and excessively risky trading strategies, culminating in £827 million in losses. His failure to acknowledge the severity of his actions, fueled by a belief in his trading prowess, played a pivotal role in the collapse of one of the oldest banks in the UK. This illustrates that overconfidence can have profound consequences, both for individuals and the institutions they represent. Strategies to Combat Overconfidence in Trading Mitigating overconfidence is essential for achieving long-term profitability and minimizing risks. Here are several strategies traders can implement to strike a balance between confidence and caution: #1 Cultivating Discipline and Humility Discipline is foundational for successful trading. Traders should commit to their trading strategies and rules, resisting the impulse to deviate due to emotional reactions. Creating a detailed trading plan that outlines entry and exit strategies, position sizes, and risk-reward ratios can help prevent impulsive decisions driven by overconfidence. Humility is equally vital in counterbalancing confidence. By acknowledging the unpredictability of the market and the limitations of their knowledge, traders can help temper their overconfidence. This humble approach promotes continuous learning and enables traders to adapt their strategies based on new information and shifting market conditions. Read Also : #2 Data-Driven Decision-Making Relying on data to guide decisions is a robust strategy against overconfidence. Traders who rely on instincts or past successes may overlook critical information. A comprehensive trading plan should incorporate both technical and fundamental analyses and be rooted in objective data rather than subjective feelings. Regularly reviewing and adjusting trading strategies based on performance metrics and market developments can reinforce discipline and counteract emotional decision-making. Read Also: #3 Implementing Strong Risk Management Robust risk management strategies are crucial in curbing overconfidence. Traders are often drawn to excessive risk when confidence is high, so outlining a maximum acceptable loss for each trade can provide a protective barrier against substantial losses. Stop-loss orders can be effective tools for limiting downside risk. Diversification of investments across various asset classes, sectors, and geographic regions can mitigate the adverse effects of individual trade losses. Recognizing that trading inherently carries risks allows traders to adopt a more prudent and balanced approach to their investments. Read Also: Conclusion Overconfidence in trading is a prevalent yet perilous barrier that can lead to severe financial setbacks. Identifying key psychological factors, including success bias and confirmation bias, is essential in addressing and reducing the impact of overconfidence. By practicing discipline, relying on data-driven insights, and implementing effective risk management strategies, traders can defend against the pitfalls of overconfidence. ✅ Please share your thoughts about this educational post in the comments section below and HIT LIKE if you appreciate! Don't forget to FOLLOW ME; you will help us a lot with this small contribution
Education
by FOREXN1
3
Educational: MACD, What is it and how to use it 📊 Introduction You might want to read more about the MACD indicator if you're seeking for a technical indicator that can assist you in spotting market trends and momentum. Moving average convergence/divergence, or MACD, is one of the most well-known and often applied technical analysis indicators. We will define the MACD indicator, describe its operation, and provide trading tips in this publication. 📊 What is the MACD? The MACD indicator displays the relationship between two exponential moving averages (EMAs) of a security's price and is a trend-following momentum indicator. The 26-period EMA is subtracted from the 12-period EMA to calculate the MACD line. The MACD line is the output of the calculation. The signal line, which is then drawn on top of the MACD line and can be used as a trigger for buy or sell signals, is a nine-day EMA of the MACD line. When the MACD line crosses above the signal line, traders may buy the asset; when it crosses below, they may sell—or short—the security. The difference between the MACD line and the signal line is represented as a bar graph on the MACD indicator called the histogram. The histogram can inform traders of the strength of a directional move and forewarn them of a probable price reversal. It can also determine whether an asset is overbought or oversold. The MACD indicator thus depends on three time parameters, namely the time constants of the three EMAs. The notation "MACD (a,b,c)" usually denotes the indicator where the MACD series is the difference of EMAs with characteristic times a and b, and the average series is an EMA of the MACD series with characteristic time c. These parameters are usually measured in days. The most commonly used values are 12, 26, and 9 days, that is, MACD (12,26,9). 📊 How does the MACD work? The MACD indicator gauges how much two moving averages of various periods are convergent or divergent from one another. The price trend is revealed by the moving averages, a form of smoothing technique that eliminates noise and oscillations in the price data. The majority of MACD changes are driven by the shorter (12-day) moving average due to its speed. The 26-day moving average is slower and less responsive to changes in the price of the underlying securities. There is a strong momentum in that direction when the shorter moving average pulls away from the longer moving average (i.e., when there is a significant difference between the two). According on whether the movement is upward or downward, this indicates that there is an increase in either purchasing pressure or selling pressure. There is a weak momentum in that direction when the shorter moving average drifts in the direction of the longer moving average (i.e., when there is a minor difference between them). This signals a lessening of buying or selling pressure, as well as a price consolidation or sideways movement. 📊 How to use the MACD The MACD (Moving Average Convergence Divergence) indicator is designed to be used for several purposes in technical analysis. Its primary function is to identify potential trend reversals, confirm entry and exit points, and assess the strength of a trend. Here are the key applications of the MACD indicator: 🔹Trend Identification: The MACD indicator helps traders identify the direction of the underlying trend in a market. By comparing the MACD line (the difference between two moving averages) and the signal line (a smoothed moving average of the MACD line), traders can determine whether the trend is bullish or bearish. A positive MACD indicates a bullish trend, while a negative MACD suggests a bearish trend. 🔹Momentum Analysis: The MACD indicator provides insights into market momentum. When the MACD line and the signal line move farther apart, it indicates increasing momentum in the prevailing trend. Conversely, when the MACD lines converge or move closer together, it suggests a potential slowdown or loss of momentum. Traders can use this information to assess the strength of a trend and make informed decisions. 🔹Crossover Signals: The MACD indicator generates crossover signals when the MACD line crosses above or below the signal line. A bullish crossover occurs when the MACD line crosses above the signal line, indicating a potential buying opportunity. Conversely, a bearish crossover takes place when the MACD line crosses below the signal line, suggesting a potential selling opportunity. These crossover signals are commonly used to identify entry and exit points for trades. 🔹Divergence Detection: Divergences occur when the price of an asset moves in the opposite direction of the MACD indicator. Bullish divergences can be observed when the price makes lower lows while the MACD forms higher lows. Conversely, bearish divergences occur when the price achieves higher highs while the MACD forms lower highs. Divergences can be early indications of potential trend reversals and can help traders anticipate changes in market direction. 🔹Histogram Analysis: The MACD histogram represents the difference between the MACD line and the signal line, displayed as bars above or below a zero line. The histogram provides visual cues about the strength of a trend. When the histogram bars are above the zero line, it indicates bullish momentum, and when they are below the zero line, it suggests bearish momentum. Additionally, the shape and direction of the histogram bars can provide insights into potential trend reversals or market consolidations. 📊 How to access the MACD. The MACD can be accessed for free by simply clicking on your indicators tab and seraching MACD where you will find Moving average convergence/divergence. The MACD indicator is a useful tool, but to make well-rounded trading decisions, it should be utilized in conjunction with other technical indicators, price patterns, and fundamental analysis. To make the best use of the MACD indicator, traders need also take into account the individual market circumstances and periods they are trading in.
COINBASE:ETHUSDEducation
by ChristopherDownie
31
The Two Types of Risk Management PlanHello traders, 1) Fixed Risk Calculates position size for next trade as a percentage of account depend on how much risk you willing to take every time every trade you taking you need to use fixed risk for every trade like for example 1% risk per trade so in this type of risk management plan we should require 100 losing trades in a row to blowing out our account a lot of people just using this simple method and this is very easy and understandable. 2) Cutting the Risk : In this method cutting the risk we just normally trade 1% risk per trade but if we lose that trade so we just cut the risk to half for example if i trade with 1% risk and i lose so now the next second trade which i am taking i will be using 0.5% risk in that trade if i lose then i will be just keep using the same risk 0.5% some traders are are keep reducing the risk size like they come all the way to to 0.25% maybe they work for it but in our scenario if we keep losing we will be not reducing more than 0.5% risk per trade and when win comes then after our winning trade we will be back to the normal risk which is 1% risk per trade and keep trading with 1% risk per trade so short summary is if we lose cut the risk to half if we when if we win back to the normal risk if we win again stay with same normal risk but if lose then reduce the risk to half. The reason behind that is in the fixed risk you have 100 traders to blowing out your account means 100 chances but in cutting the risk now we just calculate if we lose 100 trades in a row like fixed risk we would not blow out our account,, let's say we take our first trade and we lose now we are in -1% then another trade we will be taking with 0.5% per trade risk so here is 0.5% × 100 trades = 50 means if we continue to lose in a row after 100 trades we will be facing -50 draw down, so cutting the risk to half after lose trade is the safest method who wants to play safe and more chances to survive in the market. I wish you good luck and good trading. If you like the post, support my work with like comments and share thanks!
Education
by TheLoserMan
EURUSD- MONTHLY TIME FRAMEThe Structure looks good to us, waiting for this instrument to correct and then give us these opportunities as shown on this instrument (Price Chart). Note: Its my view only and its for educational purpose only. Only who has got knowledge about this strategy, will understand what to be done on this setup. its purely based on my technical analysis only (strategies). we don't focus on the short term moves, we look for only for Bullish or Bearish Impulsive moves on the setups after a good price action is formed as per the strategy. we never get into corrective moves. because it will test our patience and also it will be a bullish or a bearish trap. and try trade the big moves. we do not get into bullish or bearish traps. We anticipate and get into only big bullish or bearish moves (Impulsive Moves). Just ride the Bullish or Bearish Impulsive Move. Learn & Know the Complete Market Cycle. Buy Low and Sell High Concept. Buy at Cheaper Price and Sell at Expensive Price. Keep it simple, keep it Unique. please keep your comments useful & respectful. Thanks for your support.... Tradelikemee Academy
Short
by Tradelikemee
AUDJPY 60 MINS TIME FRAMEThe Structure looks good to us, waiting for this instrument to correct and then give us these opportunities as shown on this instrument (Price Chart). Note: Its my view only and its for educational purpose only. Only who has got knowledge about this strategy, will understand what to be done on this setup. its purely based on my technical analysis only (strategies). we don't focus on the short term moves, we look for only for Bullish or Bearish Impulsive moves on the setups after a good price action is formed as per the strategy. we never get into corrective moves. because it will test our patience and also it will be a bullish or a bearish trap. and try trade the big moves. we do not get into bullish or bearish traps. We anticipate and get into only big bullish or bearish moves (Impulsive Moves). Just ride the Bullish or Bearish Impulsive Move. Learn & Know the Complete Market Cycle. Buy Low and Sell High Concept. Buy at Cheaper Price and Sell at Expensive Price. Keep it simple, keep it Unique. please keep your comments useful & respectful. Thanks for your support.... Tradelikemee Academy
Short
by Tradelikemee
BTC/USD - Ichimoku V Calculation, P Wave, Price & Number TheoryThis is an educational post analysing BTC/USD 1 day chart using a mixture of Goichi Hosoda's Ichimoku Ichimoku Kinko Hyo System, Cloud, Number Theory, Price, Time and Wave Principles and introducing you to these methods if its your first time hearing about them. I have been experimenting with the entire Ichimoku System so I hope that you find this post interesting and helpful. The Basics: BTC is still in the Bearish Zone under the Ichimoku Cloud Equilibrium Zone on this 1 day timeframe. The Ichimoku Cloud Conversion Line (Tenkan Sen) is indicating that the MID-POINT of the SHORT-TERM momentum is sideways at the moment. The Ichimoku Cloud Base Line (Kijun Sen) is indicating that the MID-POINT of the MID-TERM momentum is sideways at the moment. The Ichimoku Cloud Lagging Span (Chikou Span) is indicating that moment at the moment is sideways. Note that the Lagging Span (Chikou Span) is still under the price from the past. Moving on from the Basics and on to more advance Price, Time, number and Wave examples: Using The Ichimoku Price Theory V Calculation V= B+(B-C) and changing it to Negative so it becomes V=B-(C-B) Our first Pivot point is A at $68,990 which serves as our base or plateu. Our second Pivot point is B at $32,926 and is part of the calculation. Our third Pivot point is C at $48,462 and is also part of the calculation. Using the Calculation V=B-(C-B) we have: (C) $48,462 - (B) $32,926 = $15,536. (B) $32,926 - (C-B) $15,536 = $17,390. Note that at the time of typing this, BTC’s low is around $17,695 which is pretty close to $17,390. So is this the bottom??? Probably not, because BTC is also in a Bearish P Wave as indicated by the light blue Descending I Wave and 2 Converging Trend-lines. This is the second Bearish P Wave that BTC has been in recently on this 1 day timeframe as can been seen from the previous light red Bearish P Wave. Note that I have used a V Calculation because the C is just past the 50% Fib re-tracement level. Ideally it should be at the 61.8% fib level between A and B but because its past the 50% it is slightly short but way too long to be a N, E or NT calculation so V will suffice. Note that the Price Targets are potential price targets which can lead to continuations or sometimes fail. In some respect, they are points where you may want to take profit or not. After many years of mathematical study, Goichi Hosoda finally settled on a set of numbers for his Number Theory, these numbers are, 9, 17, 26, 33, 42, 65, 76, 129, 172, 200~257. Note that 56 is not part of these numbers. These numbers are called Kihon Suchi and are used to project how many days, hours, mins (depending on what timeframe you are in) ahead a new High or Low, reversal ect may likely to occur using this Ichimoku Number Theory System. With Ichimoku number theory/time span, we don’t need to be 100% accurate with the numbers. Note that the distance between A and B is 75 bars, that’s 1 less then Goichi Hosoda’s 76 but that is absolutely fine with this system. Finding actual patterns is more important. Note that this V calculation could be lasting 257 Bars. We can see that from our BTC high at A we had 75 Bars until our low at B. We had 64 Bars from B to C but 65 Bars crosses over and leads close to a drop. From 2 Bars after C we have 42 Bars with a new low and the start of the Converging light red P Wave Trend-lines. I have added 26 Bars from the start of this recent downwards momentum, I have also added 33 Bars so only time will tell if a pattern emerges with these. I have not overwhelmed this chart with timespans and numbers, I have only added at places that caught my interest, and as can be seen on this chart, some of Goichi Hosoda’s numbers have been at points or close to points when things have happened to the price. So using the Negative V Calculation along with the P Wave, Timespan and Number Theory would have served you in good stead if you were shorting just after the price crossed B when moving from C especially as we have not finished the 257 Bar cycle yet. I hope this post has been helpful and informative and has shown you that the Ichimoku Kinko Hyo is so much more then just the cloud, it has its own Wave, Time, Price and Number Theories which i am by no means a master as i'm still a novice but i’d thought id share what i have been working on. I will hopefully update this post with more examples whenI have free time. I hope that this has been helpful. Notes: Ichimoku Cloud Conversion Line = Mid-Point of the Short-Term Momentum. Ichimoku Cloud Base Line = Mid-Point of the Mid-Term Momentum. Ichimoku Cloud Lagging Span = Actual Momentum Direction right now. Ichimoku Cloud Leading Span A (Senkou Span A) = Green Line on edge the Cloud. Ichimoku Cloud Leading Span B (Senkou SpanB) = Red Line on edge the Cloud. Equilibrium Zone = In-between the Cloud. Bullish Zone = Above the Cloud. Bearish Zone = Below the Cloud. V Calculation = A,B,C,D pattern. P Wave = Red and Blue Converging Trend-lines. Note that P Waves can be seen as Goichi Hosoda's version of Bullish and Bearish Pennant patterns. Note that the Blue Bar Lines on the chart are not support and resistance lines, they are just showing the distance between 2 points using Goichi Hosoda’s Numbers.
BITSTAMP:BTCUSD
by TradingThroughTheLens
5
Gala Read to make cup and handle pattern Disclaimer : It is not a financial advice am not a professional I don't take responsibility for your loss Just for educational purposes....... Here we are back on Gala Next axie infinity........ Congratulation to those who bought the dip ................. This is your host k9100............................ back at your service Speculatively forming a cup and handle patter, but it is not for sure it is going to do that. It Is my opinion, and all depends on what BTC is doing and What btc.d is doing it can we bull trap this is where the speculation game become it is forming nice cup and handle patter, and I am tracking gala for long time and telling you Guys not to sell and hold Next week is important to all the alts gala is ready for a parabolic move in my opinion Please do your own research before investing ............................................... Thanks for love and support, I hope we will reach our destination this season Always remember to take profits ................................................................................................................................... har har mahadev
Long
by k902
2