How to become successful and Profitable Crypto Currency Trader? A beginer to Advanced Level Course.Part1

Introduction :

This first Chapter aims to advanced 17 concepts that you must know to

master the art of not getting Bankrupt once you start trading.

Before you begin to learn trading, you must have a few Questions in mind

1. Can trading be a profitable means of income?

2. How much should I risk?

3. How much leverage should I use?

4. How much profit can be expected?

5. How to set the target.

  Your first step would be to forget everything you know about trading and be

ready to take a restart. There are many ways to trade the markers but we are

going to restrict ourselves to trading via Charts. Many people question if the

market can just be studied through charts and I would quote John Murphy.

The study is charts if done logically, and provides your statistics about price.

Price is derived automatically by the market after considering all the

fundamental news, the fear and Optimism of the market and hence the study

of price is indirectly the study of trend and Strength of the asset.

Hence is a Powerful way to trade, if not the best.

Why does trading with charts work, if at all.

To be honest the only reason trading which chart works is because historical

events replicate themselves and rhyme.

Scientists and statisticians look at the past data and try to find a repeating

event which can be a stimulant for another event.

A dark cloud cover for a common man could act as the sign of a rain and so

on.

Patterns repeat, behaviour repeats.

Example, if at a support region, there is a lot of market selling but all of this is

being absorbed by the limit orders, we can assume that whales want to

accumulate there.

All of trading is taking historical data, be it candlestick patterns on the chart

or a repeat of similar kind of macroeconomic conditions or news for

fundamentals driven traders, or a similar trend shown pricing and strike

prices for options traders.

There are many ways to skin the cat, but in each scenario, we take historical

data and try to find correlations where history might rhyme with the present

conditions.

The following tutorial is a culmination of different trading tools and tips you

need to bulletproof your trading. It is an introduction to how markets move

and function and teach you how you should at first, manage risk and take

trades.

There are two types of trading:

1. Discretionary Trading - Discretionary trading, on the other hand, relies on

the trader's judgement for making all trading decisions. Discretionary

traders ultimately make their decisions based on their experience, intuition,

and judgement. For example, a discretionary trader might start the day

with a plan to buy a particular stock if it drops to a certain price. However,

if news comes out during the day that changes the trader's outlook on the

stock, they might decide not to buy it after all, or perhaps to buy more of it

than they originally planned.

2. Systematic Trading - Systematic trading refers to a method of trading

where decisions are made based on a pre-set system or algorithm. This

system is developed using quantitative research and statistical analysis.

Once the system is developed, trades are executed automatically based

on the rules set by the system. For example, a systematic trading strategy

might be to buy a particular stock when its 50-day moving average

crosses above its 200-day moving average, and sell when the opposite

happens. This is a simple example of a systematic trading rule based on

technical analysis.

We will focus on discretionary trading methods in this masterclass.

This tutorial is the most comprehensive and one-stop resource for the

following topics:

● Trading Terminologies/Jargons

● Candlesticks

● Types Of Candlesticks

● Different Types Of Charts

● Invalidation

● Risk Management For Traders

● Psychological Principles For Traders

● Stop Loss

● Entry Triggers

● Exit Strategies

● Position Sizing

● Leverage For Futures Trading

● Risk-to-Reward Ratio (R:R)

● Price Action Basics

● Laddering Orders

● Trade Management

● Orderflow Basics

Technical Trading Dictionary:

First we take a look at common trading jargon. It is not important for you to

memorise all of them as it will all become familiar over time as you study

more tutorials and interact with many other traders. However, it is necessary

to go over them once to make sure you are not lost when you come across a

new term.

Arbitrage - a method of making profit using the price difference between

exchanges

Accumulation - The process by which one builds a position in an asset

Altcoin - all coins except Bitcoin

Ask/Bid - Sell orders are asks and buy orders are bids. (refer Figure below)

ATH - All-time high

Bearish MS - when price makes a series of lower lows and lower highs

Bearish MSB OR BOS - when the price takes out a low to form a lower low, we

get a brearish break of structure

Bots - automated trading set-ups on exchanges

BULL - is someone expecting the price to go higher, and the bear is the

opposite.

 Bullish MS - when the price makes a series of higher highs and

higher lows

Bullish MS - when the price makes a series of higher highs and higher lows

Bullish MSB OR BOS - Bullish market structure break of break of structure,

happens when the price takes out a high to form a higher high

Bull Market - A market where the prices are seeing a continuous uptrend,

leading to new highs being created.

Bull Trap - A technique used by market makers to buy a huge amount

suddenly, spiking the price.

Bubble - a situation where the prices are irrationally high as compared to the

actual value of the asset.

Bag - A position held in any asset or coin

Bag Holder - Someone holding a coin at a loss

Bear Trap - The market makers sell enormous amounts, pushing the prices

down, in turn liquidating everyone else that had bought, producing a

cascading effect of liquidations get a bearish break of structure.

Bull Market - A market where the prices are seeing a continuous uptrend,

leading to new highs being created.

Bull Trap - A technique used by market makers to buy a huge amount

suddenly, spiking the price.

CHOCH - Change of Character, is the first switch turning the substructure

from bullish to bearish or bearish to bullish

CMP - Current Market Price

Consolidation - A period where the price is ranging in a well-defined region.

Correction - A fall in price after making a new peak or an upward rally.

Day Trading - Taking a position in the market and exiting it the same day

Deep Swings - A deep swing high is the highest point that causes the swing

low, and a deep swing low is the lowest point that causes a swing high.

Depth of Market (DOM) - it is a list/window that shows how many open limit buy and limit sell orders there are at different prices in real time.

Deviation - When price goes below the support but reverses, or the same

happens with resistance.

Downtrend - A price trend characterised by lower highs and lower lows.

Exchange - In terms of Crypto, a marketplace that allows buying and selling

of Bitcoin and other coins.

FIB Levels - Fibonacci levels are specific levels from swing point to swing

point, these levels represent percentages. Price reacts at these levels.

FOMO - Fear of Missing Out, a behaviour where traders enter a trade without

enough research due to the fear of missing out on profits.

FUD - Fear, Uncertainty, and Doubt, negative sentiments or misinformation

affecting market sentiment.

Fractal - A pattern of price movement that has occurred earlier and might

occur again.

FTA - First Trouble Area, an area where price might be rejected before

reaching the target.

HH - Higher High

HL - Higher Low

LH - Lower High

LL - Lower Low

HTF - Higher Time Frame

LIQ - Liquidity; a liquid asset or coin means how quickly you can buy or sell

something without moving the price too much.

Laddering - you place multiple buy or sell orders when wanting to enter a

trade setup and get an average entry price

Leverage - refers to the extra amount of asset bought or sold, over your

capital

Long Position - this is a buy position with leverage

LTF - Lower Time Frame, usually anything under 4H

Margin - The amount of funds required to open a leveraged trade.

Market cap - the market capitalization of an asset calculated by current

supply of coins multiplied by CMP of one coin

Market Maker - an individual or firm that can cause large swings in price due

to overwhelming position size.

MM - Market Maker; is an individual or firm that is able to single-handedly

cause large swings in price.

MS- Market Structure, it defines the structure that the current market is

trading in.

Pattern - A chart pattern is a predefined shape that has been historically

studied by technicians. Traders try to use these previous performance

statistics to predict future price movements.

Point of Control (POC) - the price level for the time period with the highest

traded volume.

Positional Trading - the aim is to buy monthly lows and hold them for days,

weeks or sometimes months. This is a longer term trading time period

Rally - an upward trend leading to increase in price of the asset, can happen

in both bear and bull market

Return-on-Equity (ROE) -this is calculated by the actual capital employed in

a trade and not through leverage

R:R - Risk to Reward Ratio 2:1 R:R can simply be called as 2R

Sell off - Profit taking after a rally in price, which leads to lowering of price of

the asset

Short position - Exact opposite of a long entry. You enter a short when you

expect the prices to fall.

Sideways market - an indecisive market which isn't leading to a breakdown

or a break out

Spread - the difference between what the sellers are ready to sell at and

what the buyers are ready to buy at. There always exists a small spread on all

exchanges. The higher the liquidity, the lower the spread

Support and Resistance - a support is a zone or line (green below) where we

can expect price to bounce back. Resistance (red below) is a line/zone where

we can expect the price to rebound downwards.

Stop Loss - Order that is triggered when the price goes below this point, and

is used to cut losses

Swing Trade - This method looks for buying and selling positions in a weekly

range. Swing traders make 2-3 traders a week.

Time Period / Time Frame - the time spread of each candle in a chart.

Common time periods are 15 min, 30 min, 1 hour, 4 hour, daily and so on. In a

In a 15 min time frame, a candle will take 15 mins to close.

Total Supply - the amount limit of coins that will ever exist.

Trading Charts - Where to see them? There are several websites, I use

Tradingview Simple, easy and offers everything most people need. You

don't need a paid version. The basic free version is enough

Uptrend - a price is said to be in an uptrend when it is making higher highs

and higher lows

Value Area - the range of price levels in which a specified percentage of all

volume was traded during the time period. Typically, this percentage is set to

70 percent, but I use 68 percent

Value Area Low (VAL) - The lowest price level within the value area

Value Area High (VAH) - The highest price level within the value area

Volatility - it is the percentage movement in price of an asset over a period.

Volume Weighted Average Price (VWAP) - incorporates price and volume. It

is a S/R line. When price is above VWAP, it is above value and when it is below

price, it is below value

Walls - Extremely Larger orders at a range

As we conclude Part 1 of our comprehensive trading course, it's essential to recognize that a solid grasp of basic trading concepts and terminology is the cornerstone of your journey toward becoming a successful and profitable trader. Understanding these fundamentals not only demystifies the complexities of the financial markets but also equips you with the confidence to make informed decisions. By mastering the basics, you're laying a strong foundation that will support more advanced strategies and techniques discussed in the subsequent parts of this course. Embrace this foundational knowledge as your toolkit for navigating the trading world effectively. Stay tuned for Part 2, where we'll delve deeper into advanced strategies, building upon the concepts introduced here to enhance your trading proficiency.