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Stock market

How to make money on the stock exchange?

How to make money on the stock exchange?

Stock market
Undeniably, technology plays an important role in trading, although novices devote far too much time to it, which later suffers m.in budget management. Over time, it turns out that technical indicators do not give us a complete answer to how to play the stock market. Only mastery and skilful control of risk are the foundation of a good investment strategy. In this article, we will focus on what proper "money management" is all about. Profit/Loss Ratio – RRR Ratio It is worth calculating the risk properly, especially in the era of online trading,where it can get out of control particularly quickly. How does it work? The ability to conclude an unlimited number of transactions causes a rush of adrenaline and quick gratification. This contributes to the development of ...
Basics of auction theory in cryptocurrency markets

Basics of auction theory in cryptocurrency markets

Stock market
Very comfortable for the trader are technical indicators such as: moving averages or RSI. They look great on the charts, which makes the trader feel illusory security. The problem is exacerbated when a similar tool contributes to success, because reality shows that the vast majority of market participants have no idea about its mechanics and the order flow behind it. In the article we will put emphasis on the theory of auction, which we can learn from classic books about trading. As an example, we will take a cryptocurrency exchange on which concepts such as liquidity are particularly important. Impact on the price of Fair Value cryptocurrencies and the auction process According to auction theory, cryptocurrency markets and the like, i.e. currency pairs, shares of listed com...
How to set stop loss orders using the ATR indicator

How to set stop loss orders using the ATR indicator

Stock market
If you are no stranger to playing on the stock market, it is worth being in the minority that earns money from it. This will probably mean giving up techniques popular among most investors, as well as many analytical tools. It may seem strange, but 90% of current traders make losses using them. So if you want to actually earn, it will be necessary to find your own solutions and show a lot of skepticism by approaching popular opinions. Today we will reflect on the common stop lossclaim that orders should be set as close as possible to the opening price of the trade. As a result, our stock market investments may not bring the expected results. Setting stop loss orders using the average range of price movement We commonly use tight"stop losses"whose task is to limit the ...
How to read Japanese candlestick charts

How to read Japanese candlestick charts

Stock market
If our game on the stock market is to be taken seriously, it requires basic skills from us, such as reading the price history. For many years, charting standards have included line charts, bars charts and Japanese candlesticks – simple to read one at a time, but slightly more problematic in a broader perspective. In the article we will explain the operation of Japanese candles and how to interpret the data they provide us to learn the necessary basics of the stock exchange. Four messages from Japanese candles At first glance, candlestick charts may be a bit difficult to read, but each of them contains only four information: Candle opening price.Candle closing price.The highest price accepted.The lowest price accepted. If the bull candles have long upper shadows, ...
Trading with Fibonacci levels, moving averages and divergence

Trading with Fibonacci levels, moving averages and divergence

Stock market
Retail trading sometimes doesn't want to cling to the basics of the stock market. However, popular technical analysis tools can be used in other ways, maybe not entirely as intended, but still effective. In the article we will focus on well-known indicators: moving averages, Fibonacci retracements, as well as divergence and convergence, to turn them into useful elements to facilitate the game on the stock market. Fibonacci retracement In the original Fibonacci retracement, they determine the levels to which the price returns after the impulse, so that you can open a position according to the trend, at the most favorable price. To calculate the levels, the famous Fibonacci sequence was used, in which each subsequent number of the string is the sum of the two previous ones...
The invisible hand of the market

The invisible hand of the market

Stock market
Almost none of the retail traders can clearly explain what support/resistance levels are or how they work. Despite this, trading with them is one of the most popular strategies, regardless of the market. Let's play the game We assume that playing the stock market has a zero sum - your profit is someone's loss. (In fact, it is a little worse, because taking into account the commissions and spread we are dealing with a negative sum game.) So we open the chart, draw an arbitrary support line, open a long position and earn. But at whose expense? The answer is that at the expense of people who do not know the concept of support/resistance. However, the truth is different, the concept of the lines from which the course bounces is the first thing that people with almost zero e...