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Cryptocurrency trading is a rewarding venture to those who are patient enough to learn and discipline enough to manage funds. Trading requires consistency in strategizing and planning how to invest your money. Here we shall review five winning tactics in cryptocurrency trading. Before we jump right to the meat and bones of this article lets internalize what Adam Grims once Said about trading.
“You can lose your opinion or you can lose your money.” – Adam Grimes
#1. Just Trade What You Can Lose
First off, the most important practicable theory about trading is proportioning. By this, I mean risking only what you can afford to lose. suppose you have a personal saving of $5,000 it would be unwise to pump the entire sum into trading hoping that somehow you would become rich.
Unfortunately, wealth does not come that way in most cases. Although for some lucky 0.01% of people, wealth comes as luck. By this I mean someone emptying their account and placing the entire sum on one bet then actually winning the bet. This is a rare case scenario.
To actually use cryptocurrency trading as a primary source of living, one must not rely on chances or luck for that matter. There are tools out there crafted to tech traders on how to make profits trading. We advise you to start your trading journey slow with a free practice account and develop the required skill sets.
After achieving a satisfactory training outcome with the free account you can start your real trading experience with a small sum of money. As your profits grow you can increase the amount of money you trade gradually.
#2. Continuously Focus On Bitcoin
When trading shifting from one asset to another constantly can become disadvantageous to you. However many trading guides recommend traders to deal with more than one asset. The idea is you can not loose from all the assets you traded instantly and loss in one commodity can be recovered by a profit in another.
It is important though to learn the dynamics of one primary asset and make it become your main money maker. Bitcoin present many opportunities for traders to make a lot of profits. Both in the long term and in the short term, Bitcoin trading is profitable to skillful traders.
For traders who prefer long-term bets, it is almost obvious to predict that bitcoin price could more than double in two years. The odds of these kinds of bets are always very high despite the long waiting time. On the other hand, short-term traders can leverage the high levels of price movements of Bitcoin to reap profits.
#3. Do Not Put Your Investments Tied Up In One Place
As contradictory as this statement might be with the previous point we explained above, it has been proven accurate. We recommended focusing on Bitcoin in the previous article because Bitcoin is a more trusted asset than other altcoins.
It is vital to split up your portfolio to cover more than one asset on the market. Consider trading Bitcoin, Ethereum or any other popular crypto assets out there on the market. The advantage of this strategy is that when one asset is declining in value, your losses can easily be recovered from the other available assets.
However the more the assets you are dealing with, the more sophisticated your trading experience would become. We recommend you teach your self patiently on every new asset you add to your trading portfolio.
#4. Don’t Be Greedy
Another very useful aspect of any trade is avoiding greed. Sometimes market conditions can swing towards your side making you win most of your trades. Do not be greedy to think this is the time for you to make a lot of money and pump all of your capital into a single trade.
Cryptocurrency market conditions are among some of the most dynamic markets in the world. Conditions changes every second. It is vital to stick to a strategy whether you are constantly winning or losing. When experiencing a long losing streak, take a break and figure out what is causing the loss.
Also, consider revising your trade amount to prevent you from depleting your entire portfolio in the losing streak. Invent the best time of the day you can trade and stick to that period. Getting addicted to trading is also dangerous and causes huge financial losses.
#5. Don’t Invest Blindly
Before injecting your money into any crypto asset take your time to do some background checks on the asset. Some altcoins are scams that won’t last for two years and will most likely shut down. Doing background checks about the crypto asset you intend to trade can help alleviate possible losses from scams and underperforming assets.
When an asset is in a bubble stage prices are very high and sometimes traders think prices could keep increasing. Take your time to investigate why the price of the asset is suddenly very high and do not invest in it sometimes till the bubble clears out. Remember your goal is not to make quick money out of luck or chances.
Your goal is to make consistent profits using fundamental proven strategies. When you buy an asset experiencing a bubble you will never be able to sell the asset at that price after the bubble bursts.
As it is the case with any knowledge-based venture trading cryptocurrency requires patience to learn and learning from previous mistakes. You should mind about constantly improving your skills to accelerate your profit making duration while trading.
In case you found any major point missing in this article do not hesitate to mention it in the comment section below. Share this article with everybody in your social networks and follow us on Twitter.