Now we are in an important zone from which long-term movement is decided!
I chose the LTC / BTC pair as an example for positional trading. This coin works perfectly technically. To Bitcoin , the coin is held in a horizontal channel from the very beginning of trading. I think you understand that this is not an accident.
In the crypto market of several thousand scam coins there are several such technical highly liquid reliable coins. Litecoin is one of them. It is the impressive profit for those who work in large sums. The ideal ratio of profit and risk. Clear trade. It is easy to predict further price movements.
Positional trading is suitable for those who have already traded an impressive depot and are already tired of staring at the monitor and burning their time, spoiling their eyesight. For those who no longer get high from the excitement of management and so on. Because a large depot can in most cases be dispersed only by such methods. A person must have iron patience and an understanding of the market cycles. Because profits need to wait a long time. As you can see from the graph, for example, only one trend can last up to a year.
Positional trading is the work on the trend on a long-term basis, on charts covering a large time scale. For its implementation, fundamental and is often used. Position trading is suitable for all types of markets: cryptocurrencies, stocks, goods, Forex.
In other words, position trading refers to a relatively long-term holding of a position in the direction of a global trend.
Thus, position trading is an independent style, significantly different from others. Market participants can use this approach to hold short-term and long-term positions.
Maintaining a position in the trend, and not work on small weekly fluctuations. This is the main difference from swing, which involves working on the basis of market cycles of several days. In positional trading, you can hold a trade for months or even a year or more (Dow Jones index), it all depends on the trend.
Coins for positional trading are selected very carefully, they must be reliable, be closer to TOP or be this top as an example of Litecoin. There should be a real development of the project in the long term, with a strong team that really does something, and not only has a promise legend. It is very important that the coin you choose for positional trading be highly liquid.
You can work (or rather need) as in long and short. In any direction the price you earn.
If you are not working in short, then most of the position is HOLD on a WALLET! In such a trade where transactions are conducted 1-2 times a year, it makes no sense to risk a huge amount and keep coins on the exchange. Even if you are doing risk diversification through several liquid exchanges.
Only the large time frame is important, we do not pay attention to small price fluctuations.
The purchase / sale of an asset is made only upon confirmation of a change in trend.
No hai and loy! Minimum prices and maximums will be left for hamsters.
Position Trading Rules:
1) A signal to enter a position is the beginning of a trend on a large timeframe (with a timeframe of 1 day or 1 week).
2) Exit from the transaction is carried out only if there are sufficient grounds for the end of the trend (trend change).
The advantages of positional trading.
1) Does not take into account small price changes, that is, does not require constant monitoring of the situation.
2) There is no need to be near the computer all the time. In positional strategy, the most important thing is a deep and thorough analysis, on the basis of which a further decision is made.
3) An open position simply needs to be monitored if there is a situation that can change the position or price.
Positional trading strategy is an analysis of daily, weekly and monthly timeframes; holding an open position for at least a few days to several months.
In simple terms, positional trading is a meaningful and balanced entry into a transaction based on holding a position in a trend.
The disadvantages of positional trading.
1) a long expectation of results that can actually be measured only after months or years;
2) high responsibility for each forecast and analysis, since it can take many days and weeks to hold the wrong position;
3) slow progress in trading (holding positions is good if the trader already has experience, but you won’t be able to gain it quickly by opening deals once a year);
4) the need for significant investment (you can get a tangible income from position trading only if you have a decent amount of money in the account).
As a result, holding a position in certain cases is a significant advantage for an experienced trader, but fatal for beginner speculators.
I have shown potential reversal areas in an existing trend on the chart. The ideal long entry point would be a breakout or pullback after a downtrend line breakout. Please note that there is 1 month on the chart. The reversal will be more clearly visible on the weekly timeframe . I have shown a monthly chart so that it contains the entire trading history and shows the essence of the work.