Add and reduce method
01. I have learned this powerful technique from Jason Jenkins. You can't time tops and bottoms, but you can manage your trade sizes.
02. The method is about scaling in and out of trades. In this case, because it's a downtrend for XRP, I'm always in a "core" position. If it dips deep, I take profit. ("selling into momentum"). When it rallies, I'll add more shorts.
03. I use 9, 13, 21, 55, 200 EMA (based on fib numbers) as guidance when to enter. If XRP blows pass 200 EMA, I will take a heavy short position. If XRP touches the 21 EMA, I'll add a "light" short position. Everything is about risk management (exact entries don't matter as much as you think)
04. Always trade the trend and look at the market structure. It's obvious that XRP is on the decline phase of the trend. Keep trading the trend until it doesn't work anymore then flip to long. Understand where the coin is in the market structure is absolutely important.
05. The great thing about the "add and reduce" method is that you're always in a position trading with the trend, so you don't need to FOMO into price. Since I'm shorting XRP, if the price does a mega dip, I'll take profit and then buy back on the rally.
02. The method is about scaling in and out of trades. In this case, because it's a downtrend for XRP, I'm always in a "core" position. If it dips deep, I take profit. ("selling into momentum"). When it rallies, I'll add more shorts.
03. I use 9, 13, 21, 55, 200 EMA (based on fib numbers) as guidance when to enter. If XRP blows pass 200 EMA, I will take a heavy short position. If XRP touches the 21 EMA, I'll add a "light" short position. Everything is about risk management (exact entries don't matter as much as you think)
04. Always trade the trend and look at the market structure. It's obvious that XRP is on the decline phase of the trend. Keep trading the trend until it doesn't work anymore then flip to long. Understand where the coin is in the market structure is absolutely important.
05. The great thing about the "add and reduce" method is that you're always in a position trading with the trend, so you don't need to FOMO into price. Since I'm shorting XRP, if the price does a mega dip, I'll take profit and then buy back on the rally.
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