I have finally managed to fully close my BNB/BTC trade. I have been holding on to my BNB for probably a month now and it has shown very little movement even though majority of other crypto currencies have seen sharp declines. I have opened my trade at 152700sats, closed a portion of it at 155400 sats last week and another portion at 155950sats just yesterday.
This second portion was closed because I had moved my stop when BNB started rallying yesterday and basically I have placed it too tight. Had I not done that I would have probably been able to ride the wave quite a bit further.
At the time of writing this BNB is at 175000 and I feel like a right fool for not just leaving it alone as initially my first profit taking target was at around 163000 with 170000 as my target to close the position fully (resistance levels). With so many coins falling I was worried BNB would follow the market, but as we can all see it did not.
Not a big deal I suppose, just a lesson for next time to be a bit more patient. On the other hand, nobody ended up broke by taking profits, however small these profits are.
As usual here is the snapshot:
Blue line is where I bought, green line is where I sold (sad face) and the big green pole (candle) is what I will remember next time before moving my stops. Result is 2% profit.
I hope you don't mind, I want to mention a couple of things you said in your post, two that's absolutely correct and one that's absolutely wrong :-)
really bad idea, that's why most people lose money. Ask any financial institution about what their (losing) retail traders accounts look like and they all say the same thing, lots of little wins and a couple big losers = bust. It should be the opposite, lots of small losers, but huge wins.
absolutely, this is the part that most people have trouble with, either impatient to make money or scared to leave money on the table, closing the trade early.
You should be very impatient with losing trades, just cut them dead and move on, take the small losses. On the other hand, be extremely patient with winning trades and maximise the profit, dig every single penny you can out of it. Retail traders do it the wrong way round, let losers run too long and cut winners too early.
again, reports from trading institutions and the statistics of failed traders "stop losses too close or moved stop losses too early". All these point to the same thing, patience and the belief in your trade to see it out to the end.
Great feedback, thanks @tradergurl. I can openly admit it was my impatience this time taking over the control.
Any practical advice/tips from your experience in this regard?
How do you manage your stop losses if you see your position entering the profit zone after a period of boring sideways movement? I'd like to think it would have been easier for me to sit tight had this movement happened earlier.
It's easy, before every trade you decide where to put your stop loss, and where your profit target is (even if it's a trailing stop, or a MA stop or something else, doesn't matter). Then you enter the trade and sit on your hands.
It either works and you make money or you make a small loss. Don't 'fiddle' with the trade, you made a decision at the start based upon the available evidence, and until the trade either wins or loses, it's still the same evidence. There shouldn't be any reason to change the trade plan halfway unless it's due to fear or greed, and in both cases you'll end up losing money because thats gambling, not trading.
I'm not saying you shouldn't move stops up to breakeven, or lock in profits, but only if you have some rule set in advance and you follow it to the letter.
If, over a period of time you find that you're losing too much money to not making enough, then go back and re-evaluate your system, but you need a set of rules on every trade that you never deviate from.
"lots of small losers, but huge wins" - I like that strategy, pretty much what I aim for.
tell the truth, this is your only strategy
That's not true! I also have this cool one where I buy high and sell low.
Ah dude! You sold BNB! BNB is an incredibly solid hold - for two main reasons:
The first is a decentralised Binance with it's own blockchain. BNB will be converted to the coin of the Binance chain, and should rocket in value.
The second is that Binance is right up top on the crypto exchange size list, so it sees serious volume. As you are no doubt aware, BNB is used to discount trading fees. As more people use Binance, especially institutional money with large trades, so your BNB will continue to climb in value.
Buy the next dip. And hold it. And never let it go again! I sold off two thirds of my BNB not too long after buying it from a very young Binance. I regret that sale to this day.
@bitbrain, while I do agree BNB is a solid coin and Binance is a solid company I am a bit more upset about the fact I've not stuck to my plan this time and sold prematurely. All the coins will come back down again at some point. There have been several occasions over my relatively short cryptocareer where I though that I will never see a coin at those levels again and they all seem to come back down sooner or later. I can remember a couple of examples:
An they all came back to down :) I have to admit though, I really like Binance and their coin. When I buy BNB I don't feel it's likely it could go to nothing in a few days.
Absolutely, they have a nasty tendency to drop unexpectedly, this is why I always keep a bit of something or other on an exchange for emergency buys.
Not sticking to the plan has burnt me several times. Selling early is a sure way to lose money. I'll probably still do it several more times in my crypto career!
Cardano should still drop a lot relative to BTC. It's been way too high for way too long. A coin should earn it's keep, and ADA doesn't. That value is chiefly speculative.