Trade With The Trend
Futures traders pay a close attention to the trend of the market before they take any new position. The trend is considered to be your friend when you trade. But before you take a trade you need to know what a trend exactly is and how it is your friend.
The market valuations move in the upwards, downwards or the sideways trend. When the buyers are dominant in the market then the trend is bullish. When the sellers dominate the market then the trend is bearish. When the phase is that of indecision then it is a sideways trend.
Knowing the trend of the market lets one takes a profitable trade. The market direction represents what the majority of traders are doing and whether the outlook of the market is bullish or bearish. It is recommended to trade with the trend because it will not stop you out often and also let you ride the trend and make a lot of profit.
Up trending market
When the market is trending or bullish then this means that the market has a very positive outlook and there are more people buying it than selling it. When this happens then the available supply is decreased and increases its demand. When this happens the prices go higher and when the upward price movement has momentum and get sustained then this leads to a strong uptrend.
An uptrend is when you see the market making higher highs and higher lows. You need to draw three or more than three points to be able to confirm an uptrend. It is important to be able to spot the uptrend as soon as possible so that you are able to ride the trend and make a lot of profit.
Down trending market
When the outlook of the market is negative or bullish then this means that there are more sellers than buyers in the market. This causes an increase in supply and a decrease in demand. When the market is bearish then this means that the valuations are lower. When the prices start to decline with momentum then that is sustainable then this creates a strong downtrend.
A downtrend is when you see a series of lower highs and lower lows. To be able to confirm a downtrend three laws are required. This confirms the bearish move. To be able to short the market and make substantial profits one should be able to spot the downtrend fast and ride along with it.
Here is how you can trade the trending market on Bitcoin Loophole.