Elementary Strategies of Bitcoin Trading — Part 2: Price action trading
Price action trading is one of the most widespread trading strategies when the trading of bitcoin and other global assets are concerned. Price action, or „the price behaviour“ controls the price graph, and gives all needed information, about when to enter the trade, to the trader according to it.
The efficiency of this strategy is considerably higher when tradig bitcoin, than, for example, when trading forex. It is because one can more easily watch data, which have an actual impact on bitcoin (the size and closure of margin positions, Fibonacci retracement of the range and its confirmation according to the setting of orderbook — graph, price formation recognition). At a great volume of the trades, it makes sense to make an effort and invest to tracking tool (a tool, which is tracking the wallets of big BTC exchanges, and their outflow-inflow over time, and therefore signalizes potential big sales).
Price action trading is important mainly on orderbook level, where big buy and sell payment orders of fundemental importance accumulate on certain price levels (especially on bitfinex.com Exchange). Those so-called buy-sell walls have a specific structure, namely from buy-sell orders (those are all otders, but the difference is, that there are also profits of margin positions on this level, watched lines of the great speculators). The market has a tendency to break those price borders and then return to their level (support line).
To be continued..
The previous part: Elementary Strategies of Bitcoin Trading — Part 1: Linear Trading
Do you have some feedback for us? Leave us your comment below or submit a comment on our Twitter or Facebook page.
Do not forget to join our new next generation Bitcoin trading platform NakamotoX now and win awesome prizes. More on: https://nakamotox.com/