Market Mechanics – 5 Principles You Need to Know to Make Money
1. Price moves from liquidity to liquidity. This is a general rule for all markets: crypto, MOEX, FOREX, etc.
2. The largest accumulation of liquidity is found beyond levels. Therefore, entry points into a position should only be sought near levels. If you take this as a rule, you will significantly boost your trading.
3. Levels must be visible to everyone. The clearer and more understandable the levels, the more liquidity (stops) there will be behind them, and the stronger they will attract price.
4. Technical analysis only works on active coins with organic liquidity and large relative trading volumes. That is, on coins that retail has an interest in. The more relative volumes have grown on a coin, the better breakouts, bounces, and inclines will work on it, etc.
5. The character of a coin's movement is largely shaped by the market maker that services it. Therefore, before executing a setup, you must look at how the coin has reacted to such setups in the past in a similar market context with similar volumes.
