Your success in bitcoin trading is largely governed by your prudence – besides – of
course – your skills. And, your sagacity is determined by your decision to trade at the
first place. Losing your bitcoins on a consistent basis is no desirable proposition, the
volatility of the market notwithstanding. Your decision to join the industry itself should be
based on thorough introspection. Why is it that you would want to trade
cryptocurrencies or bitcoins? Is it because your friends are doing it? Is it because you
want to feel the rush that’s quintessentially associated with the highly volatile market?
Or, is it because you have done your initial homework on bitcoin trading and are willing
to try it on your own?
Chances of success are definitely higher in the last case. There is no room for arbitrary
decisions here. Start trading only when you are completely sure about your intentions.
The right strategies not only help you ace difficult moves but also keep you motivated
throughout. You can’t just do it because your friends are doing it but because your
intentions are backed by due knowhow. Documented below are ways in which you can
expect to succeed in bitcoin trading.
Do not jump on deals
Do know for a fact that not all traders can actually gain from trading. As preposterous as
that might sound initially, we are not asking you to be completely inert as a trader. The
Altcoin market is largely spearheaded by the big sharks that are just too busy spotting
the mistakes of small fishes. The big sharks are the ones that put huge blocks of
Bitcoins on the order book. They primarily thrive on mistakes made by small traders. So,
it’s better not to be too ambitious and trade every day. If the market turns out to be too
volatile on any given day then it’s only prudent to lie idle.
Do not give in to the tricks of biased sources
Be on your strongest guard against fake coins, Ponzi schemes and pump & dumps.
Your initial research on the cryptocurrency market will acquaint you with the existence
of the fake schemes. Make sure that your education is helping you tell the difference
between genuine brokers or trading websites and fishing pages or fraudsters.
You should wisely educate yourself about risk management as well. A profitable trade is
not about making huge profits on a single day (that’s why you are asked not to rush
through trades every day). Profits in bitcoin are all about small gains being accumulated
into a big sum.
Learn to manage risks
There are definite ways to shore up risk management across your portfolio. For one,
you should never aim for peak of the movement. Never invest more than a small
portfolio percentage in a non-liquid market.
Have practical expectations
Yes. The points mentioned above must have given you an idea already. Do not really
go on to risk money beyond your means – in the hope of getting double or triple of what
you have invested. Don’t invest funds meant to pay your kids’ school or college fees.
Don’t invest your personal life policy fund. Do not expect digital currency to make you a
millionaire in seconds. Set realistic goals of 5, 10 or 20% profit and stick to the same.
Learn about stop loss
Know how to set the stop loss level properly. One of the effective ways to stay on a
profitable track is to cut down losses as well. Stop losses are meant to help you with
that. It refers to the practice of setting the level of loss where the trade gets closed. You
should acquaint yourself with the ways in which you can actually go on to set the level
correctly instead of getting too hopeful about your prospects. Most of the traders commit
the huge mistake of ruling out chances of making substantial losses. They think that
even if they do suffer losses, they will be of minimal nature- whereas in reality the value
of crypto coins can even go down by 80%.