The Enigma of Crypto Trading: Weighing Experience Against Historical Trends
The Enigma of Crypto Trading: Weighing Experience Against Historical Trends
I have been trying to figure out something about cryptocurrency trading and the volatility in its entirety. I see traders entering trade after taking analysis of the market, considering the market pattern as it has been from past till now. Also putting into consideration other factors like order block, trendline etc. If the market movements is based on that and all traders are experienced, that means they will mostly be on the winning side of the market.
Now for those that have known how bitcoin have been transgressing since its inception and a possible bull run after the halving. If the traders are to put that into consideration, will they still need to do their normal analysis before entering the market or follow the past pattern of the market that it usually does when an event like that happens? It’s really confusing me and amazed to know how traders still get to be profitable amidst this factors.
I think I get what you’re driving at, that’s if the pattern of the coin actually takes precedent of the past that they don’t need to analyze and just go with the pattern of the past. I will say you are not that wrong to assume that history is will repeat it self but I say history doesn’t repeat it self always in the matter that concerns volatility. Yes in very long term history will repeat it self like your coins growing in profits oof held on to for long. But on a short basis like that of trading you made of most especially futures it fluctuates because of two things the demand and supply. The Chart might be in a certain pattern obeying past trend but a huge change can happen due to any of this factor.
Another strong factor that alters patterns is the fundamental analysis of that coin. Take a look at bitcoin, in the pa a new all time high only comes when the halving must have occurred, now forward to this year, we had a new ATH right before the halving period breaking the trend of the past and what did brought this? It was certainly the news around ETF approval which caused a huge surge of demand and made it so. So you see traders need to re strategize or analyze all the time just not to be beaten off by news. But in a long run the market tends to obey history that’s why you see many experienced investors ask people to
Yea, patterns repeat itself, trends never cease from repeating but the question the trader has to solve to be in profit is when does the trend has to actually repeat… Cause that’s where your analysis comes in, you’ve to analyze to know not to take a wrong trading position because fake-outs are there to test your psychology. Simply put, market history do repeat but the challenge lies on the trader to get an accuracy of the timing either through technical or fundamental analysis of the market.