A Repost of [AAVE/USD Sell] - Crypto Academy/ S6T4- Team Trading Contest Post for Reminane.
Hello everyone, it's another trading week in the Crypto Academy which allows us to practice what we have learnt in the Academy overtime. I am in Professor @reminiscence01 team for this week trading contest. This is my 2nd post for the week and based on this, i will be giving a full details of the trade i took at the beginning of this week being 30/03/2022. I will like you to stay tune as i analyze the asset below.
•The name and introduction of the project token, which exchanges it can be traded on, project / technical information of the coin/ team background, etc.
In this task i will introduced to you the name of the Coin i will be trading for this 2nd day 30/03/2022 for the reason of this current trading competition as well as the introduction of the token and the growth achieved so far.
The name of the token i have traded is AAVE, this is a visual token / coin used by trader in buying or in trading the financial market.
As a trader, it is very important you understand what l the financial market is all about, because it's of great importance. It involves buying and selling of Crypto in the market. When we talk of the Blockchain ecosystem, this is where transactions takes place between two or more persons via a digital asset and this is what we referred as token. You should have an understanding that this tokens are mostly issued on a blockchain like the Ethereum, this is depending on the assigned properties to them as well as their classification and uses.
Aave (AAVE) as the name implies is the native cryptocurrency of a platform known as Aave platform. This platform is a decentralized finance (DeFi) where traders can have access to borrow a range of cryptocurrencies, users also put money into the system inform of lending in order to generate more cash, and this is in form of interest payments and the system does not requires middle man.
In 2017 Aave was created by Stani Kulechov, a for profit company which is located in Switzerland. However, Aave means "ghost in Finnish" and as it was launched in October 2020, it was known as ETHLend and it rebranding took placed September 2018.
In history, Aave has it root in the African-American Vernacular English, which helps in the identification and creates expressive sources for its members. Today, according to the current price predictions, AAVE's price can reach $238 and $300 by the end of the year 2022 and 2023 respectively. According to the price prediction, we are looking at the price to reach $500 during middle of 2026 which is four (4) years from now.
As a member, you can only placed your funds into the Aave liquidity pool and this will be achieved when your wallet is connected into coin liquidity pool. This is how members generates interest from the platform. However, below are the steps which members can achieve this:
• Click the Staking option on the left corner of the screen.
• Select the amount of cash you wish to stake, at this point you can start earning intrest with AAVE coin.
Sincce it was launched, AAVE has experienced steady increased over the price per token by 249,07%. According to statistics, its current market cap is $4,27 billion, total value locked (TVL) : $18.028 billion, Aave has higher correlation with Ethereum than Bitcoin (0,46) and (0,18) respectively.
https://coinmotion.com/what-is-aave-crypto/
Market Cap: $2,148,444,939,358
Rank #48
Aave Price (AAVE): $235.55
Low:$182.51
High:$240.32
- Binance
- Coin Tiger
- Hotcoin
- Global
- Bybit
- OKX
•Why you are optimistic about this token today, and how long do you u wish it can rise.
The truth is am not planning to hold this coin for long time. The analysis i have made is for intraday trading and it's for a short position. When the price reach my profit target as i have set it, the position will execute it self but unfortunately, this trade has gone against my prediction and i made a loss.
•How to analyze the token? (This can technical analysis and trading strategies learned from professor's courses) - This section is very important.
For the reason of this trade, i have traded AAVE/USD using using the Bollinger band and Relative Strength Index for my analysis while i make used of mt4 chart.
When you look at the above chart, you will see that i have make used of an indicator called Bollinger band and this is one of the indicators we learnt in the past in the Crypto Academy lesson. The band selves as a support and resistance of price in both phases of the market either bull or bear market.
The settings can be seen below:
The truth is you can not succeed the market by only using the Bollinger band but i have equally added the Relative Strength Index to get proper entry and exit criteria. Below is the screenshot of the RSI settings:
Period: 14
Apply to: Close
Style : 2pixel
Level: 70,30
The RSI levels is an important point where traders can make informed decisions about the the next trend or movement of price in the price chart. At point 70, the price is over bought and at point 30, the price is at it over sold region.
Now the combination of the Bollinger band and the RSI give us and edged in the market because the both indicators tells us the next trend in the market.
In a bullish market, when you see the price closes above the band, and we have a red candlestick retracement back into the band and closes inside the band, at this point you should go short in the market. Your stop loss should be places above the previous high of the last candle wick and take profit should be at the next support level. Note, the RSI must be at point 70 or above 70 before you can take the trade.
For my short position, i have open a sell stop position. This mean that the market has passed this point, so when the market trend down to that point it will trigger my entry as seen below:
Entry Price: 202.79
Stop loss: 207.72
Take Profit: 179.86
Risk to Reward Ratio: 1:1
How to calculate the take profit:
Stop loss price - Entry price = xx - Entry Price =TP
That is: $207.72 - $202.97 =$4.93
$202.79 - $4.93 = $197.86
R:R =1:1
The market went against my entry, and i made a loss of -$2.61 as seen in the screenshot below.
You should understand that even if you have any amount of money, you can not move the market. The market is been moved by the big boy or the big banks. What you have to do is to follow the trend and you should not be expecting to make gain always that is why we where told to invest cash we can bear the lost. It is always advisable to buy assets at lower price but most times, traders find it difficult to understand the trend of the market as well ass reversal that is why the indicators i have used can be helpful to you.
•Your plan to hold it for a long time or when to sell.
I don't have it in mind to hold this trade for too long, once thee market decrease more than where i sold the asset, i will sell the trade. For now the trade has reverse to hit my stop loss and it has closed the trade with a lose of -$2.61
•Do you recommend everyone to buy this token? Give reasons for your answer.
I will say yes to this, i will recommend anyone who whish to hold to do so because AAVE is the No 48 coin in the coinmarketcap and now the market price is down so i recommend investors to buy and hold AAVE now to sell and make returns in future come 2026 based on statistics. The risk involved here is the ability to have patience and hold the coin to raise, but you are not advice to invest cash you can not loss.
•Any other thing you might want to share about this coin/token.
AAVE is the number 48 Crypto leading coin all trader will like to have. Based on its popularity and growth, the coin has been ranked as number 48 coin in the coinmarketcap.
In this task, i have successfully carried out analysis on AAVE on MT4 chart and i have open a sell stop order position on my MT4 exchange platform. This is the 2nd day of the contest for this week.
Thank you very much for your time