When an Altcoin has high correlation to Bitcoin
I'm going to be trading the altcoin differently.
I will give a lot less care to whatever the price action of the altcoin is
and give a lot more weight to whatever BTC is doing (since it is "leading" the altcoin)
So even if the altcoin's price action appears to have an acceptable trade setup to take, I will NOT take it until BTC's price action happens to line up nicely for a setup as well.
And if I do end up taking any trade in an altcoin, I'll only be using the altcoin as a proxy for the BTC trade. This is because I'll be able to take advantage of a slightly wider move in the altcoin and a bit more volatility as well.
Below is an example of how PEPE was following BTC (high correlation). ↓
I'm going to be trading the altcoin differently.
I will give a lot less care to whatever the price action of the altcoin is
and give a lot more weight to whatever BTC is doing (since it is "leading" the altcoin)
So even if the altcoin's price action appears to have an acceptable trade setup to take, I will NOT take it until BTC's price action happens to line up nicely for a setup as well.
And if I do end up taking any trade in an altcoin, I'll only be using the altcoin as a proxy for the BTC trade. This is because I'll be able to take advantage of a slightly wider move in the altcoin and a bit more volatility as well.
Below is an example of how PEPE was following BTC (high correlation). ↓