Interest Preservation, Risk Management With Bus Ride Tactics
There are some very important art in trading coin which is preservation of interest and risk management. That is the action to put the price back to a good positon (buying price ) so that even in the short term the market is how you are still profitable, just a profit less or more instead of losses. It is also called the bus ride art of the bus is also artist, let us share a little bit about the experience of the bus ride for you guys :
“About the time of purchase: I have said many times, there is no fixed number. The good price to buy is the price you buy on it can increase, the good price to sell is the price after you sell it, it will decrease. Imagine a bus ride, from the beginning of 01, 02 -> end at 10, and then back from 10 -> 01. If you go up at point 01 is very great, you will get a huge advantage. Without psychological pressure and easy waiting for the last stop. On the other hand, if you go from 05 06, you can still go a long way through the bus, but you have to watch, you get late, you will get to the destination sooner, and you have to jump down before it goes back, again. People up in position 01 still have to watch, only they are more leisurely, more and more late to follow, up at no. 9 is still good, but you gotta dance fast.
On the contrary, when the trend is down -which means the train is returning, you still jumped to the position of 07, the bus will take you to no.5, even number 3 2 1 and you hole it.
So, take the bus properly. If it is up, you can dance on any side, as long as the last dock go down. If you see the car is turning back and you got no experience, at least wait until it turns up, then we back up the car.
But the difficulty here is how to get onto landing 1 ?
There are two things:
1. The level of market perception and graphical experience, which we are constantly sharing in recent posts to understand the position reversal. That means you watch and buy at very low prices.
2. Use the capital management to put his position on landing 1, this is such an art.Imagine you have $ 100k, divide the capital into 5 parts, $ 20k each.
For example with BTC, when BTC is priced at $ 5200 it is risky, if at that moment (If you are less experienced, risky market) you will go to 1 part of the capital.
BTC is $ 6000, we have the following profit: $ 40,000 * 15.3% = $ 6,120, compared with a total profit of 6.1%, a very good with large capital.
Assuming you did not get to $ 5200, when the price up $ 5600 with a sure sign for advancing $ 6000, you enter $ 100k. When the price reaches $ 6000, you are required to make the amount of money you are playing only equal to the original plan amount. Specifically, your rate of return is 7.14% * 100k = 7k14, you sell at least 3/5 -> 4/5, then your Base Price will take you back to landing 1–2, you have the right to wait as early as.
The majority of players are confused in profit figures without paying attention to the rate of return, in any case to squeeze the highest rate of return. For example:
You dropped $ 20k, profit $ 5k
You give $ 100k as well as a $ 5k profit
Then you drop $ 100k is your risk is much greater because a few percent of the coin is very simple, so you will fall into the “ I saw the blue is red (Margin) “ status. Do not ever let yourself win against big capital, always have enough time to place your ship back on board 1 2 3.
Another example:
You buy 500 ETC price 20, the current price is 25, you still expect price up 30 but not sure. The technical indicators show a 55/45 up / down trend, which means that the opportunity is not overwhelming. You sell 250 ETC prices 25, retain the remaining 250 ETC. So the difference can be estimated as if you bought 250 ETC for $ 15 (- $ 5 profit from 250 ETC sold at the original price). So now you can assume that you buy 250 ETC from $ 15, and in the short term the price can almost not fall from $ 25 -> $ 15 in a day, so even if it is just a little profit , can not hole. For example, early profit-taking rates depend on market signals.
This is just basically in the DCA experience (average price). When you’re good at managing capital, the amount of money you play is always fixed. Of course there will be times when you can hold longer. When there is a latch, you don’t have to latch them all, if there is a light door to let 1/5 -> 1/6, ( because you are at landing 1, 2 ), there will be a time when you learn to master and adept, just go on landing 1, it will return to it anyway . This is the intellectual game, make sure to use your head.
