There are many trading techniques and my always try is that I share some good strategy with you people. In todayโs post I will tell about hedging and how with this technique your loss will be minimum.
First of all, lets understand about hedging, its a method where you open 2 positions at the same time. Long and short positions. This will help you increase your profit and reduce the risk of loss.
Surely trading has risk but with this strategy your risk will be minimum. Like in yesterdayโs post I shared HIVE analysis and also drew a trend line. The point of intersection was our focus for the next move. I say that if the price moves down from that point the trend will go bearish but if it stays above the trend will remain bullish.
In this case, when your are doubtful about the price that where it will go, then you will consider the long trend which is bearish, in this case I will prefer short position for my trade.
Taking the same chart I will explain this amazing strategy. For example, if you want to trade in HIVE, looking at the trend line if the market chance is mostly bearish then in this case you open short position with 10X leverage and on the other side you open long position with 5X leverage.
According to my analysis the price has more chances to go down so in this case short will give you profit and the long position you opened will give you some loss but still you are profitable.
In case if the market goes up then you will get loss on short but with that the long you opened will give you profit which will cover your short position loss a lot.
This is called hedging, where you open two trades at the same time and same position but on opposite sides. Also keep in mind that analysis is very important and according to that you have to take trade.
Now talking about take profit and stop loss. Take profit you can set according to your choice, for example I think if I get $5 in a day then for me it is enough.
Stop loss is very important because in future market there is risk of liquidation. Understanding your risk, you must put stop loss.
I hope you find this post interesting and I hope you will like it. If you like the post, please leave feedback in the comments section so that the next one will be even better. Thank you for sticking with me until the end.
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IMAGES AND GIF TAKEN FROM CANVA, EDITED IN CANVA
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