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Abboodat
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💭 How do you determine the overall trend of a currency before opening any position?
📌 A successful trader does not enter the market without knowing the overall trend. Here is a simplified way to determine it:
1. Start with the larger timeframe (4H or Daily): Look at the bigger picture. Is the price making higher highs and higher lows? This means it's an upward trend. Is it making lower highs and lower lows? This means it's a downward trend. $SOL
2. Use moving averages (like MA 50 and MA 200): If the price is above both moving averages = the trend is upward. If it is below them = the trend is downward.
3. Use a trendline: Draw a line connecting the lows or highs. Breaking or respecting it confirms the trend.
4. Don't forget about trading volume: Strong trend = high volume supporting it.
Why is this important? Because when you trade with the trend, you increase your chances of profit and decrease your chances of loss.
