How to do a defensive trading strategy?

Quidat

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Quote from: otundebis on August 25, 2021, 03:14:09 PM

It's seem defensive trading strategy is all about been cautious and guiding effectively your trading capital! This strategy may prevent or cut losses, but it will definitely restrict ability to make profit as well. As saying goes, 'nothing ventured nothing gained!' What is trading if you are not taking a calculated risk, it will get boring!

Defensive trading is most likely talking about good risk management on protecting your capital as much as you could basing off with those unexpected events or market conditions because
nothing on this world would really be considering on having a perfect trade or being profitable from time to time. Defensive or whatever what it may call is really meaning of on how
to project yourself on severe losses or making out back up methods on where to avoid much bad trades.This is where people do differs because not all would be experienced
and knowledgeable enough.

otundebis

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It's seem defensive trading strategy is all about been cautious and guiding effectively your trading capital! This strategy may prevent or cut losses, but it will definitely restrict ability to make profit as well. As saying goes, 'nothing ventured nothing gained!' What is trading if you are not taking a calculated risk, it will get boring!

Rehan Zakir

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Defensive trading means that safer trading in which our assets are safe or not in high risk. Trading is not an easy task. And don't trade with emotions. Place a trade with full analysis that you are placing a trade with the trend of the market. And must place stop loss on your trade. So, it is really helpful for trading.I think these are the things that helps to decide a defensive trading.

Karish2return

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The most important defensive trading strategy i wanna tell you is that you should take a less profit even but is should be profit, never ever you have to be greedy about any coin or any type of profit in trading whether it is small or big doesn't matter, the more there is greed , there will be more chances of getting into loss, so , it will be best for you to take a less profit even getting into loss.

Pethanou

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I think, if you look from this point of view, it, of course, can be counted on.

LUCKMCFLY

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Guys I have seen that many talk about Stop Loss, and yes, without a doubt it is a very safe way to operate, but before getting into the technical, do not you think it is better to make a good market diversification plan? Not everything can happen when trading, both BTC, alts, we must also think of a superior strategy, such as Real Estate, investment in the Stock Market.

I was reading an interesting article and it talks about how many can guarantee a great portfolio if those who are investors or traders of the stock market invest at least 15% in BTC it would be successful, and it is like this:

Source: https://ambcrypto.com/after-gold-can-bitcoin-take-on-the-stock-market/

Now, if with a good trading or investment plan we can launch a strategy based on "Stop Loss" and "Take Profit", is it not ideal for a complete portfolio with many stocks from other markets? Wouldn't it be much better to have that kind of diversification in the face of any global eventuality?

BlackFor3st

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The best defensive trading strategy is stop loss I think you can also consider and take profit at the same time in this way if the price pumps and dumps just like a trap at the resistance you have the chance to take profit to it unlike if you don't have take profit also then you miss the chance on having a profit.

lenovop-70

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My defensive strategy is not to be greedy and put stop loss as small as possible, as long you are patient you will win. About market psychology, you also need to learn and it can be done while doing trading activities. Being a trader is not easy, it takes a lot of time and cost of money to understand and find a comfortable style to make profit.

Ziskinberg

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Quote from: fullhdpixel on August 08, 2021, 03:44:20 PM

Quote from: Xampeuu on August 08, 2021, 01:47:36 AM

I think a good defensive strategy is to cut losses when getting out of the support area. Therefore, if we continue to maintain losses, it could be that our emotions are not maintained and later can panic sell at bigger losses. As traders, of course, we must be able to keep our capital safe, because there are still many opportunities later

A strategy in defensive manner but beyond stoploss levels? I understand that you are suggesting to keep holding until getting out of support levels which means even stoploss levels fall before that then we need to wait more? I guess it would be too dangerous for our capital. Personally I will not prefer it.

I am always too conscious to go for stoploss so that I will keep my capital ready for next opportunity rather than waiting for markets to bounce back. This is the reason, I guess your way of defensive strategy is not coming under my risk management principles.

Stop loss is commonly used by many traders, quite some didn't and just let the fund stay there waiting for the next pump, and I actually did sometimes just to know what will be the results. I made several trials and I have noticed that stop-loss helps us during the bear reason but not in the bull market. I have lost a few bucks with this study and trials, even though you will think this could be enough and will give a satisfying output but base on my experience, we can never assure that it all be fine. The volatility of the market makes these things happen and so losses are still evident.

fullhdpixel

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Quote from: Xampeuu on August 08, 2021, 01:47:36 AM

I think a good defensive strategy is to cut losses when getting out of the support area. Therefore, if we continue to maintain losses, it could be that our emotions are not maintained and later can panic sell at bigger losses. As traders, of course, we must be able to keep our capital safe, because there are still many opportunities later

A strategy in defensive manner but beyond stoploss levels? I understand that you are suggesting to keep holding until getting out of support levels which means even stoploss levels fall before that then we need to wait more? I guess it would be too dangerous for our capital. Personally I will not prefer it.

I am always too conscious to go for stoploss so that I will keep my capital ready for next opportunity rather than waiting for markets to bounce back. This is the reason, I guess your way of defensive strategy is not coming under my risk management principles.

Xampeuu

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Quote from: Bustart on August 07, 2021, 06:59:52 PM

Defensive trading is all about our emotions, and if we're not strong enough to handle every circumstances that might be arising once you're struggling to come up with sustainable gains. Some traders often become emotional so they're going to be panic. Most important in trading is to keep your coins intact and don't dwell with shorts and quick trader to avoid losing much money.

if in trading we are not stuck short, then do we not use stop losses, even though it is very important to cut losses. I think a good defensive strategy is to cut losses when getting out of the support area. Therefore, if we continue to maintain losses, it could be that our emotions are not maintained and later can panic sell at bigger losses. As traders, of course, we must be able to keep our capital safe, because there are still many opportunities later

eance

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More sophisticated strategies integrates call/put options to hedge the market. This is the most effective way to protect your trades. Stop loss won't work when you need it most.

Bustart

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Defensive trading is all about our emotions, and if we're not strong enough to handle every circumstances that might be arising once you're struggling to come up with sustainable gains. Some traders often become emotional so they're going to be panic. Most important in trading is to keep your coins intact and don't dwell with shorts and quick trader to avoid losing much money.

wxa7115

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Quote from: checkmatesir on August 02, 2021, 08:55:18 AM

I will definitely suggest you to use stop loss for most of the coins which you can't analyzed which will definitely help you and will prevent you from a big loss, i don't say that it will be 100% but at a certain level, which will be beneficial.

Even if you use a stop loss this is not a guarantee that you are not going to suffer great losses, we must understand that if the coin that you are trading has a very low volume then the coin can crash really quickly, and even if you have a stop loss in place it is likely that you are going to have to sell your coins for a price way lower than that level, producing losses way bigger than what you were expecting.

So if you want to trade defensively not only you have to choose the right tactics you also need to choose the right assets to do so, and in this market there is no better coin to engage in such kind of strategy than bitcoin, it is true that its volatility can be huge but compared to what we can see in the market of altcoins its volatility is many times smaller.

CryptopreneurBrainboss

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Quote from: Clavulanic on August 04, 2021, 05:32:13 PM

If you wanted to defend you money on trading manipulation, don't deal with uncertainty of the market. Just have the options to hodle instead of taking riks on day trading because you may be pressured by the time market goes red in signals

While this the best of all the defense mechanism against the market still it won't be fun as trading is. The satisfaction that comes from been successful in out smarting the market is what makes trading very eventful to participate in. If you ask for my opinion, I'll always choose investing (holding) over trading but that doesn't mean there's no good in trading. Trading gives you short term profits that holding can't and holding gives you long term profits that trading might not be able to give especially as the market is very unpredictable

If you have the funds, combining both investment technique could be very vital in having a successful time in the industry. For your short term profits, you can get that from trading constantly and using the defensive method highlighted in other comments above to help secure you against any manipulation form the whales or market. Gorbyou long term goal, you get that from your investment holdings.

awik p

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Quote from: Hypnosis00 on August 04, 2021, 06:21:07 PM

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Quote from: XCANA on August 03, 2021, 06:54:02 AM

The whole bottom for trading is to make profit either with the use of indicators or which ever strategies you are using. If you are too greedy to go all in or after making 5% you want to wait till it reaches 10% and then later wait till 20% and 30% , in a single move against your position you will loose all your profit if not capital. So, be careful with whatever trading strategies you are using to avoid too much lost.

Strategies should be more on your advantage because you are playing in the market with a great weapon, so finding your best strategy is the key to succeed. As per defensive trading, maybe its more on a profit taking strategy and cutting your losses, technically we all have that kind of strategy, we are just different in execution.

Believing our self that we can protect our fund from losing through using effective strategies is good enough. Honestly, if we are too careful in dealing with the market changes and have huge knowledge of the market, I think that was enough to keep our funds intact and even to grow it more.

What it becomes difficult for us and struggling hard to keep our funds safely is because we sometimes drag by our emotions. This is the biggest challenge for everyone and this is the common reason why a trader is committing mistakes leading to worse ends.

Emotions are the biggest challenge to face when trading. to control emotions of course we need real trading practices, so we can feel it, at first even though we already have an analysis and are wrong, sometimes we find it hard to cut losses, and that is the first challenge for traders to keep their emotions in order to be disciplined with analysis

Hypnosis00

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Quote from: XCANA on August 03, 2021, 06:54:02 AM

The whole bottom for trading is to make profit either with the use of indicators or which ever strategies you are using. If you are too greedy to go all in or after making 5% you want to wait till it reaches 10% and then later wait till 20% and 30% , in a single move against your position you will loose all your profit if not capital. So, be careful with whatever trading strategies you are using to avoid too much lost.

Strategies should be more on your advantage because you are playing in the market with a great weapon, so finding your best strategy is the key to succeed. As per defensive trading, maybe its more on a profit taking strategy and cutting your losses, technically we all have that kind of strategy, we are just different in execution.

Believing our self that we can protect our fund from losing through using effective strategies is good enough. Honestly, if we are too careful in dealing with the market changes and have huge knowledge of the market, I think that was enough to keep our funds intact and even to grow it more.

What it becomes difficult for us and struggling hard to keep our funds safely is because we sometimes drag by our emotions. This is the biggest challenge for everyone and this is the common reason why a trader is committing mistakes leading to worse ends.

Clavulanic

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If you wanted to defend you money on trading manipulation, don't deal with uncertainty of the market. Just have the options to hodle instead of taking riks on day trading because you may be pressured by the time market goes red in signals. Our very main concern here is our emotions, trading is all about how you handle yourself in times of difficulties you need to overcome all those factors that make you more exhausted during fluctuations.

DarkDays

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Quote from: livingfree on July 14, 2021, 03:12:15 AM

In summary, that's just all about cutting your loss.

Defensive in all of your trades and in taking profits, you're not that greedy at all. With some few percentage of profits 5%-10%.

You're already taking profits or even less than 5%.

A position on a defensive loss is basically making sure that when you get in profit you take that profit or you give yourself a percentage of that profit while still remaining in the market. A good strategy for this is to use a stop loss and only when triggered you'll get your profit otherwise you can stay in the game, and of course, you can increase that profit as you wish. That way you reduce the loss.

LUCKMCFLY

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My defensive strategy is as follows:

1.-I have to do 3 operations.
2.-Trading in medium and long long, this includes that in each operation I must place:
A.-STOP Loss (less than 10%, maximum 8%)
B.-Take Profit (StopLoss * 3, that is, if I risk 8% I should win 24%)
3.-If I lose an operation, I must recover what I lost with the other operation.
4.- If I lose the previous two operations, I must recover what I lost with the last operation and leave the market without losing, but in a neutral balance, if I go out in a better gain, aunqeu is very difficult.

5.- If I lose the 3 operations I must assume my loss, and analyze the market otherwise, because the QEU vision assumed from the market is not correct.

I think this is a good defensive plan, it is the one that I continue, of course if there is another more cash it would be interesting to know it.

Topic: How to do a defensive trading strategy? (Read 712 times)