If the most patience-testing and painful market is the sideways market, sideways market means no obvious volatility. How can we realize profit margins without volatility? It is too time-consuming to fluctuate back and forth by a few points, just like constipation!
The constipation market in the cryptocurrency circle can sometimes last for quite a long time, such as two or three months. Not to mention the A-share market, which sometimes remains at similar levels for several years without any obvious fluctuations.
In fact, there is a trading strategy that is most suitable for such a volatile market.
Grid Trading
Recently when Ethereum was at 1800, I have been running grid trading. The more volatile it is, the happier I am, and the more volatile it is, the smoother I feel!
So what is a grid trading strategy?
Grid is a quantitative trading strategy that can help users automatically buy low and sell high within a certain price fluctuation range according to the set grid interval. Specifically, grid trading is based on a price, and a certain number of buy/sell orders are placed at each price level in a geometric or arithmetic progression, so as to make profits by selling high and buying low within the price fluctuation range.
To put it simply, there is a price range, and the range of the automatically set strategy is about 20%.
The number of grids - how much money to invest. The arithmetic grid is assuming 10000u, 20X, each grid is 500u, and the profit of one grid is one grid.
Simple and clear, but the bullets are easy to run out.
Geometric ratio means based on percentage, no explanation needed.
Suddenly I feel it would be great to run A-shares on a grid.
