Hybrid/dynamic cryptocurrency trading technique
If you are not comfortable with a purely mechanical system or carried away by emotions when using a discretionary technique, a hybrid trading style may be an ideal approach. If you apply it correctly, this type of strategy can offer a better way to trade in the highly volatile cryptocurrency market.
A pure mechanical trading system relies on price signals based on various indicators to get valid entry/exit to produce profits in the long run. Because you have to wait for an accurate signal to take a trade, this approach eliminates the psychological aspect of greed and fear when making trading decisions. Although trading emotional-free is good, the disadvantage is that there are some times when the mechanical approach can give signals that don’t coincide with the market conditions.
On the other hand, a discretionary trading strategy depends upon fundamental analysis, risk sentiment and price action to determine movements in the market. While this technique takes into account the current market condition, it can produce inconsistent results when used by a trader easily influenced by personal biases and emotions.
A hybrid trading strategy is a combination of mechanical and discretionary techniques to make better trading decisions. The advantage of trading using a hybrid approach is that it is customized to your trading personality and understanding of the market. You will be able to incorporate indicators and tools that you intuitively understand and most comfortable using. With this strategy, you only take trades that make the most sense and have more chances of producing better results.