RSI and MACD are giving potential confirmation of trend reversal soon to happen. So should I already open position when it's cheap? Definitely not. Support at 400 level has to tested and the price has to bounce from this support level to get confirmation for further upward movement. Also new positions should be opened close to swing high at 440 level.
Educational part why to use stop-losses: About importance of stop-losses. Yesterday there were flash crashes almost in every market section and some of the cryptos are still recovering from it. It's super important to set stop-loss function before opening any new positions as if flash crash does occur it can make painful to recover from. Stop-loss is suppose to prevent huge losses in case market are crashing or going downwards and you are not monitoring them. Also it's giving us leverage of selling it before the bottom hits and these bottoms can be opportunities to accumulate more of that certain crypto and buy way much cheaper!
Also to learn more about the divergences. You can find educational chart in my trading view account that's explaining Divergences. It's under "Divergence Trading Patterns".
Trading information: Buy: Above 440 Partial Profit Target: 480 & 510 Long term target: 553 & 678 Stop-loss: 390
Things to remember:
To trade safely we need to use stop losses in case something goes wrong.
Note this is a long term trade! Requires patience and flexibility to adjust the sails of the market movement.
Always be aware of things, trends and events what's happening around the current crypto you are trading. They may have big impact on the price movement!
It's better to wait than to regret. This is important when you are doing long term investments! Knowledge behind of your trades gives you success, more often!
Any questions or need help? Feel free to leave comments and feedback! Yarr!