Definition ∞ A trading strategy is a predetermined plan that outlines the rules and conditions under which an investor or trader will buy or sell a particular asset. It typically incorporates specific entry and exit criteria, risk management protocols, and position sizing guidelines. The aim is to achieve consistent profitability by systematizing decision-making and mitigating emotional influences. A well-defined strategy provides a structured approach to market participation.
Context ∞ In the context of digital asset trading, strategy development is a continuous process, influenced by market volatility and evolving technological landscapes. Current discussions often revolve around the efficacy of various quantitative and qualitative approaches, including trend following, mean reversion, and event-driven tactics. A key debate involves the optimal balance between automated execution and discretionary decision-making. Future developments are likely to involve greater integration of artificial intelligence and machine learning to refine existing strategies and discover novel trading paradigms.
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