This year's trading policy
Happy New Year.
The start to the new year is steady.1,500,000yen around and has been rising gradually, and currently1,800,000yen around is being maintained.
■ Taste of a market led by altcoins
Ripple, which has shown strong momentum since the end of last month, continues to rise,Ripple,1 month shows almost15 times higher, and the market is dominated by altcoins. Many investors are re-evaluating their annual strategies and reorganizing medium- to long-term positions at the start of the year, in our view.
Therefore, until any currency shows strong momentum, selective buying will continue, and until BTC becomes the market leader, it will likely take some more time. Even looking at the charts, a triangle formation can be drawn, so until clear catalysts appear, a gradual rise is expected, and the author plans to observe for a while.
Although the total market capitalization of cryptocurrencies has expanded about2times since last month,BTC-excluding altcoins- are showing even more than that,3 times or more, reducing BTC’s relative value. Market dominance has fallen to33% (early last year it was in the80% range). Currently at a low level, so I viewBTC as quite undervalued, but what do you think?
■ This year’s strategy
Following reflections on last year’s trading, I am starting with the following trading policy.
①
Trade simply based on Dow Theory and Fibonacci. I hardly refer to technical indicators other than Bollinger Bands.
②
I regularly analyze triangle formations, head-and-shoulders, and trendlines, and enter only when I can accurately identify turning points in trends.
③
Do not go against the trend
④
Carry profits and take gains actively. Be mindful of position sizing.
⑤
Trade casually
Of course, I have no intention of completing this policy over a year; the cryptocurrency market is still in a trial-and-error stage, so discarding highly advanced analytical methods and strict rules may seem tempting. This is a point of reflection from last year: it’s better not to overcomplicate things.
■ The chart is the only material
In traditional financial markets, chart-reading-based trading strategies are considered outdated, but I believe they may be exceptionally effective in the cryptocurrency market. The reason is simple: there is no other basis.
In classic financial products, trades involve major financial institutions, so prices reflect scarce information such as the atmosphere of the trading room. Large-scale statistical analyses are conducted, making trends less clear when looking at charts alone. For cryptocurrencies, however, charts are the sole anchor. Not only are exchange prices coarse, but there is no universal material in the news either. In short, I believe it is more important than ever to think flexibly by purely looking at charts.
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【Author】
Nishiou Kawada(Kawada Saio
Trading Securities Market Division, Market Trading Section
Born in Geneva, Switzerland. Graduated from Keio University.
Having traveled to many countries, the author’s fanamental analysis rooted in real experience is persuasive.
Utilizing behavioral economics learned in college, he analyzes market participants’ psychological biases theoretically and applies them to trading.
Hobby is shogi; he is a dan-level amateur, and the middle-game strategy also helps in reading the market’s next move.
“The masses are always wrong” is his creed.
【Disclaimer】
The cryptocurrency price information and other content provided on this site reflect the author's personal views and do not guarantee the accuracy or safety of the content by the author, Traders Securities Co., Ltd., or our company. Also, the information is intended to provide参考 information only and does not constitute a recommendation for specific investment actions or investment methods regarding cryptocurrencies. Please make final investment decisions on your own judgment. Any gains or losses from investments belong to investors. The author, Traders Securities Co., Ltd., and our company are not responsible for any damages incurred based on this information.
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