The Tech Quiz - Season 39

Hi everyone,
It's another day of the week, and I'm delighted to participate in this contest today organized by @malikusman1, which talks about The Tech Quiz - Season 39. I will be making my entry below, so read through it and drop your valuable comment, as it will be appreciated.

Source

What is narratives trading?

As the name suggests, narrative trading is a type of trading that deals with the trading of cryptocurrency assets based on stories and narratives by people around the world. These stories can be news, discussions by whales in the crypto industry, and many more. All of these drive the market in a certain direction, and traders also make informed decisions based on these given stories.

So, in summary, we can say that narrative trading is a type of trading that deals with technical analysis, fundamental analysis, and also market psychology, which has to do with what people say or think about the market within a given period and time.

There are lots of things that contribute to narrative trading, and a few of them are fundamental analysis, market sentiment, economic indicators, political events, social media trends, and market psychology. So, with all of these in place, the stories give traders what is needed to go ahead and make informed decisions.

Which narrative can grow in the next year?

Based on stories and speculation, one of the token I want to believe will grow next year in accordance to the narrative trading is the $PUSS coin that we currently have as a memo coin in the Steemit platform.

Source

Now, I said this because since the introduction of the coin we have been hearing a lot about it and here on Steemit almost everyone has bought the said asset because of the potential we saw associated with it. At the moment, you will agree with me that a lot of persons participated in the contest where we have the opportunity to win $500 worth of Steem in honour of the $PUSS coin.

These are talks and hype made for the coin which has made me to believe that the said asset will definitely grow well next year because more mechanism are put in place from peoples narrative which will help the coin attain an all-time high which is the ultimate goal of the asset.

What risks come with focusing too much on narratives in trading?

Narratives in trading sometimes don't appear the way it is being portrayed and this means that if anyone focuses too much on the narrative he got about a certain asset then there are tendencies that he or she may b disappointed at the end.

Source

So in my opinion, the risk that comes with gocusing too much on narratives in trading is that you may gather all your eggs in one basket and then lose all of them because the speculation didn't later work out as people said it would.

Often things of this nature make people to focus so much on things that people have said and at the end they loss so much because they didn't have plan B since they have higher hopes for the narrative or plan A.

I want to invite @josepha, @simonnwigwe, and @bonaventure24, to join the contest in this community and share their entry participation.