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Cryptographic market volatility: How to use limit and RSI commands to maximize your yields

The world of cryptocurrencies has been known for its extreme volatility in recent years. Prices can pull one day, just to chop the next one. This unpredictability makes it difficult for individual investors to navigate the market effectively. However, with appropriate tools and strategies, it can reduce your risk and maximize your yields.

Limit orders

A limit order is an order to buy or sell security at a specific price before the market reaches that price. In other words, an investment apartment is set, specifying a minimum price you want to enter or leave the market. Here are some key advantages to use limit orders:

* Risk reduction

: Limited commands contribute to reducing their exposure to price fluctuations by limiting their potential losses.

* Flexibility: You can adjust your order size and target price before entering or leaving the market.

* Punctuality: The limit commands allow you to react quickly to market changes.

To make a limit order, simply use the following steps:

• Choose a corridor that accepts the limit commands.

• Set an account with desired cryptocurrency and corridor.

• Create a new order that specifies the objective price, quantity and any additional condition (for example, «buy $ 1000»).

• The order will be executed as soon as the market reaches the specific price.

RSI (Relative force index)

The relative force index is a popular technical indicator used to analyze the power of trends and impulse on financial markets. Developed by J. Welles Wilder, it measures the extensive changes in prices to determine the general conditions or conditions. This is how RSI works:

* Overgraph: RSI increases over 70, indicating that prices should probably have a delay.

* Overdold: RSI drops under 30, which suggests that prices need to rise.

RSI use to identify trends

To use RSI effectively in your negotiation strategy, follow these steps:

• Set a threshold (eg, 70) to identify overcompra or general conditions.

• Analyze the RSI values ​​and compare it with the established threshold.

• Use the resulting signals to inform your commercial decisions:

* Buy if RSI drops below the threshold, indicating a possible investment of trends.

* Sell if RSI increases over the threshold, which suggests that prices can be due for a return.

Combining limit orders and RSI

By combining the limit commands with the technical analysis, such as the RSI, you can create a strong commercial strategy. Here’s an example:

• Set a limit order to buy $ 1000, in order to enter if RSI falls below 30.

• Analyze the RSI values ​​and determine that they must be withdrawn.

• Enter your limit order to the specified price.

Conclusion

The volatility of the cryptographic market can be discouraging, but with appropriate tools and strategies, it can browse it more efficiently. By incorporating the limit orders in your commercial strategy and the use of technical indicators, such as RSI, to inform your decisions, you will be better equipped to manage the risk and to maximize your yields. Don’t forget to always keep discipline and patient in your trades, because extreme market fluctuations will continue to appear.

Note: This article is only for educational purposes and investment advice should not be considered. Cryptocurrency trade involves significant risks, including losing main investments. It is essential to do thorough investigations, set clear goals and manage the risk before entering any operation.

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