Simplest Way to Trade $LUNA
(UPDATED on 14/2/2022)
Is there such thing as simple in trading? Maybe not. There is nothing simple in trading. But, what I am going to show you in this post really looks simple and clean to the eyes.
This is applicable for people who wants to swing trade and is not bothered to check price movement at every waking hour. Wise trader will set stop loss right after any entry. Unless you are trading Fast In Fast Out (FIFO) style, you should not spend every second looking at the chart movement! (Oopss, seems like I am talking to myself here…)
I am going to use $LUNA chart for the explanation. $LUNA has been climbing upwards since July 2021 and reached $100 when you were busy celebrating Christmas. The price was due for healthy correction and that was what happened when the new year started.
To add on that, Bitcoin price also fell after Feds minutes was released. (It happened when I was sleeping and I actually woke up to a red portfolio). Almost everything was red on that day including $LUNA. Knowing that great coins will bounce at support, I just went on with my life… (crying inside T_T)
Okay, back to the topic. These are what I screen captured on Jan 9th 2022:
Today is the 13th of January 2022, and the daily chart looks like this:
The key here is to draw the trendline. Always know your trend as TREND IS YOUR FRIEND. You can draw lots of support and resistance line, Fibonacci levels, and also use many indicators and confuse yourself with too many information. Or you can stick to the strongest basic, the trendline. Remember to always know your trend.
In this case, I actually wasn’t sure if the price will continue to drop until I drew the trendline. Practice drawing trendline every time you open any charts will help you see the bigger picture. If I did not draw this, I would be unsure whether $LUNA will bounce, or if it will keep going down. Thank god I cleared my chart and drew the trendline.
Now, will you enter $LUNA on this rally? Will it surpass its’ all time high price? What do you think?
UPDATE 14/2/2022
It has been a month since my last screenshot on how to trade $LUNA. This is probably a needed update. Let us see where the price is now and analyze what is going on and what do we think will happen.
Remember what I said about trend is your friend? Yes it is definitely!
If we stick to the trendline, we would definitely cut our losses once the $ has broken the line. The $ is now trading below EMA 50 (green line) and near EMA 200 (pink line). In my opinion, it will be able to continue it’s upward movement if the $ manage to stay above both EMA 50 & 200.
The Bollinger Band is getting smaller, so weneed to be extra careful here. It can either explode up or even down. Be sure to always set stop loss to avoid huge losses.
Let’s draw another line here, but this time a down trendline.
If we see a bounce soon, I would personally target the price to hit the down trendline. But if the $ cannot stay above EMA200, I will not touch it. It probably will continue to go down if it lose the EMA00 support.
That is all for today’s update. We will see how it turned out and I will do an analysis update next month.
