Current position covering refers to purchasing the same currency through additional investment to reduce the average holding cost when the currency price drops. Reasons for covering positions include reducing costs, increasing chips, and enhancing confidence. The best time to cover a position is when the currency price drops sharply and technical indicators show signs of rebound, such as MACD golden cross, RSI oversold rebound, and bottom reversal pattern. When covering positions, you should pay attention to: avoid blindly covering positions, control the proportion of covering positions, choose high-quality currencies, and set stop losses.
The concept of currency circle cover-up
Cryptocurrency circle cover-up means that when the currency price falls, investors invest a certain amount to purchase the same currency, thereby reducing the average holding cost.
Reasons for covering positions
- Reducing costs: By covering positions, investors can dilute the average holding cost, thereby increasing the overall investment return rate.
- Increase the chips: Covering positions can increase the number of currencies held by investors, providing more room for profit from subsequent currency price increases.
- Enhance confidence: Covering positions shows that investors are still optimistic about the currency, which can enhance others' confidence in the market, thus driving up currency prices.
Time to cover positions
The best time to cover positions is usually when the currency price drops significantly and technical indicators show signs of rebound. Specifically, you can refer to the following indicators:
- MACD indicator: DIFF and DEA lines form a golden cross near the 0 axis, indicating that the market is about to rebound.
- RSI indicator: The indicator value fell to the oversold range (below 30) and then rebounded, indicating that the market has been oversold.
- K line pattern: The emergence of bottom reversal patterns, such as hammer line, morning star, etc., indicates that the market is about to rebound.
Notes on covering positions
- Don’t blindly cover positions: It is necessary to fully analyze the market and confirm that the decline is just a correction, not a trend reversal.
- Control the proportion of position replenishment: The amount of position replenishment should not be too large, generally not exceeding 50% of the original position cost.
- Choose high-quality currencies: Choose currencies with good fundamentals, technical support, and community support to cover positions, and avoid high-risk or unstable currencies.
- Set stop loss: Set a stop loss order after covering the position to prevent the currency price from continuing to fall and causing greater losses.
The above is the detailed content of What does it mean to cover positions in the currency circle?. For more information, please follow other related articles on the PHP Chinese website!

As fear drives selling in the crypto market, major coins like Cardano and Solana face tough times.

In the past 24 hours, the general crypto market has recovered as digital assets shake off bearish sentiments. Within this time frame

Key market indicators, like the relationship between Bitcoin and market volatility (BTC/VIX ratio) and the total crypto market capitalization on weekly charts

As meme coins continue to take the crypto world by storm, savvy investors are constantly looking for the next big opportunity.

The crypto market has witnessed a rebound following the recent sheer downturn. As per the exclusive market data, the total crypto market capitalization has reached $2.71Ts

A Pennsylvania man faces federal prison after pleading guilty to flipping more than $13 million worth of digital art from the infamous CryptoPunks NFT collection — and reporting none of it to the IRS, prosecutors said Friday.

In recent times, meme coins have emerged as a unique and exciting investment opportunity, drawing both seasoned investors and newcomers alike.

Toncoin appears to be positioning itself for a short-term rebound after enduring a week of market-wide losses that affected most cryptocurrencies.

Hot AI Tools

Undresser.AI Undress
AI-powered app for creating realistic nude photos

AI Clothes Remover
Online AI tool for removing clothes from photos.

Undress AI Tool
Undress images for free

Clothoff.io
AI clothes remover

AI Hentai Generator
Generate AI Hentai for free.

Hot Article

Hot Tools

SAP NetWeaver Server Adapter for Eclipse
Integrate Eclipse with SAP NetWeaver application server.

DVWA
Damn Vulnerable Web App (DVWA) is a PHP/MySQL web application that is very vulnerable. Its main goals are to be an aid for security professionals to test their skills and tools in a legal environment, to help web developers better understand the process of securing web applications, and to help teachers/students teach/learn in a classroom environment Web application security. The goal of DVWA is to practice some of the most common web vulnerabilities through a simple and straightforward interface, with varying degrees of difficulty. Please note that this software

SublimeText3 English version
Recommended: Win version, supports code prompts!

Notepad++7.3.1
Easy-to-use and free code editor

Atom editor mac version download
The most popular open source editor