Today we are going through the brief technical explanation about the round numbers and stop loss hunting
round numbers:
the round number end in a zero, and have a tendency to attract orders and most of the time attracts many traders and they choose these points for entering and closing the position
Point:
For open position on round number the proper point for entering to trade is nearthe round number and not exactly on round number
For example:
For opening long position(buying) , your entry point should be above the round number and For opening short position(selling) your entry point should be below the round number.
Pay attention to the BITCOIN price near the round number 40000 :
If you want to open long position it's better to put your entry point above this round number but important point is that if this round number touches usually we have stop loss hunting and it is better to put your stop loss in proper place below the round numbers.
Stop loss hunting:
It is a strategy that makes market participants out of their position by driving the price to the area that many traders choose to set a stop loss there.
For example:
here on round number of 40000 we can expect that stop hunting happens and if someone wants to open long position on BITCOIN it is better to put stop loss below the round number with considering 3 percent penetration and if the price breaks this area the support becomes invalid.
🐳MAD WHALE🐋
This is not financial advice, always do your own research.
please, fell free to ask your question, write it in comments below and I will answer.
🐋
round numbers:
the round number end in a zero, and have a tendency to attract orders and most of the time attracts many traders and they choose these points for entering and closing the position
Point:
For open position on round number the proper point for entering to trade is nearthe round number and not exactly on round number
For example:
For opening long position(buying) , your entry point should be above the round number and For opening short position(selling) your entry point should be below the round number.
Pay attention to the BITCOIN price near the round number 40000 :
If you want to open long position it's better to put your entry point above this round number but important point is that if this round number touches usually we have stop loss hunting and it is better to put your stop loss in proper place below the round numbers.
Stop loss hunting:
It is a strategy that makes market participants out of their position by driving the price to the area that many traders choose to set a stop loss there.
For example:
here on round number of 40000 we can expect that stop hunting happens and if someone wants to open long position on BITCOIN it is better to put stop loss below the round number with considering 3 percent penetration and if the price breaks this area the support becomes invalid.
🐳MAD WHALE🐋
This is not financial advice, always do your own research.
please, fell free to ask your question, write it in comments below and I will answer.
🐋
