Understanding: strategies for the successful trade in cryptocurrency
The world of cryptocurrency trading can be volatile and unpredictable. With the rise of cryptocurrencies such as Bitcoin, Ethereum and others, the market has become more and more congested and complex. One aspect of this market which is often neglected is the expiration in the long term. In this article, we will explore the importance of the expiration of term contracts in the trading of cryptocurrencies and provide strategies to the merchants who succeed to navigate this critical component of their investment strategy.
What is expiration in the long term?
The ultimate expiration refers to the point where a negotiated contract reaches its expiration date. At this stage, the underlying asset (in this case, cryptocurrencies) will no longer be negotiated on the scholarship where it was initially listed. This can have important implications for merchants, as term contracts can provide a leverage and potential profits.
Why is the expiration in the long term in the trading of cryptocurrencies?
Ultimately expiration can create opportunities for merchants to take advantage of price movements before being fully carried out. For example, if a merchant bought a cryptocurrency contract at 10,000 unit per unit, but the market price falls to 8,500 units before expiration, it can be able to sell your contract and recover a part of their initial investment. Conversely, if a trader sells a term contract with an expiration date in the future, he could be forced to keep the assets until this date, potentially lock the profits.
Strategies for the success of the expiration of term contracts
Although trade on expirations can be a high -risk strategy, there are several strategies that successful traders use to navigate this critical component of their investment strategy. Here are some key strategies to consider:
- Sizing of the position : The dimensioning of positions refers to the amount of capital allocated to each profession or contract. A good size position allows more flexibility and reduces the risk in the event of losses. However, this also means that a larger proportion of your capital is at stake, so be sure to allocate a reasonable part of your global portfolio.
- Risk management : Risk management refers to the process of identifying potential risks associated with the negotiation of expires and measures to mitigate them. This may include coverage strategies, stop orders or other techniques that help limit losses.
- Technical analysis : Technical analysis is the study of market movements and price models. By analyzing graphics and trends, traders can have an overview of potential opportunities and risks associated with trading at the long term.
- Sensation of the market : The feeling of the market refers to the tone or the global attitude of the market towards a particular asset. Traders who are aware of the feeling of the market can use it to their advantage when they decide to negotiate expirations.
- Diversification : Diversification is the practice of spreading investments in different markets and assets. By diversifying your portfolio, you reduce your exposure to any particular active or market, which makes it more difficult to compose.
popular trading strategies for the expiration of term contracts
Here are some popular trading strategies that can be used in conjunction with term expiration:
- Next trend : The following trend is to identify the direction of a trend and position itself accordingly. This strategy can be applied to long and short trades.
- Scalping : The scalping involves taking several small trades throughout the day, in order to enjoy the movements of low prices. This strategy requires high levels of market knowledge and rapid reaction times.
- Trading based on news : information -based trading involves using news events as a trigger to enter or leave a profession. This can be applied to long and short professions.
