RoYoK
--
Bullish
‼️ Averaging Futures Can Save Your Life 💡
Averaging consists of opening additional positions with a standard or larger volume after the first trade.
🤔 It is possible to average:
A losing position so that the entire series of trades results in a win; a profitable position to maximize profit (this method is also called pyramiding).
✍️ Practical Example:
1️⃣ Let's imagine that a trader decides that the sharp drop on November 4 should be followed by the development of a bearish dynamic. After the upward correction, they make the first sell trade (SELL 1).
2️⃣ The market goes against the trade, and the trader can only wait. When it seems to them that a new downward movement is beginning, they double the volume and make the second sell trade (SELL 2).
3️⃣ But the market goes against the trader again. The next day, the trader, following the same logic, makes the third sell trade, doubling the volume (SELL 3).
4️⃣ After the third trade, fortunately for the trader, the price moves a sufficient distance downwards so that the entire series of trades can be closed with a profit. (PROFIT).
Averaging can create a misleading feeling that bad trades can always be "pulled out" by averaging. It will work for a while, but revenge will inevitably come. A strong move against you and – total loss of the deposit.
💡 It is important to understand:
☑️ Averaging is an AGGRESSIVE method of capital management.
☑️ For a beginner trader, averaging is always BAD and will lead to significant losses over time.
☑️ A PROFESSIONAL trader can use trading systems with averaging, but with a stop-loss for the entire series of averaged trades not exceeding 1% of the deposit.
#StrategyBTCPurchase $SOL
Averaging consists of opening additional positions with a standard or larger volume after the first trade.
🤔 It is possible to average:
A losing position so that the entire series of trades results in a win; a profitable position to maximize profit (this method is also called pyramiding).
✍️ Practical Example:
1️⃣ Let's imagine that a trader decides that the sharp drop on November 4 should be followed by the development of a bearish dynamic. After the upward correction, they make the first sell trade (SELL 1).
2️⃣ The market goes against the trade, and the trader can only wait. When it seems to them that a new downward movement is beginning, they double the volume and make the second sell trade (SELL 2).
3️⃣ But the market goes against the trader again. The next day, the trader, following the same logic, makes the third sell trade, doubling the volume (SELL 3).
4️⃣ After the third trade, fortunately for the trader, the price moves a sufficient distance downwards so that the entire series of trades can be closed with a profit. (PROFIT).
Averaging can create a misleading feeling that bad trades can always be "pulled out" by averaging. It will work for a while, but revenge will inevitably come. A strong move against you and – total loss of the deposit.
💡 It is important to understand:
☑️ Averaging is an AGGRESSIVE method of capital management.
☑️ For a beginner trader, averaging is always BAD and will lead to significant losses over time.
☑️ A PROFESSIONAL trader can use trading systems with averaging, but with a stop-loss for the entire series of averaged trades not exceeding 1% of the deposit.
#StrategyBTCPurchase $SOL
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.