Trading crypto coins successfully is possible.
Yes, excelling at this all-new trading format is quite likely—it’s just that as a trader, you’ll need to form some good habits, build rich experience, and stick to some fundamentals.
Cryptocurrency is a very hot topic these days, and its trading is rising in popularity as well. Since there’s a lot of volatility associated with crypto trading, there’s a chance to either earn truckloads of profit or face massive losses.
So, everything comes down to how you’re trading. And when it’s about trading properly, you’ve got to stick to some ground rules. And, here, we’ll discuss some of these rules with you.
Only invest an amount that you can afford to lose
In the crash of January 2018, many amateur investors got burned. In the beginning of 2018, the reports of the crypto crash brought with them several other news snippets of smashed laptops, broken monitors, and heavy monetary losses.
So, that means just one thing—this trading format comes with its own set of risks.
First things first, as soon as your money gets converted into crypto money, it becomes digital. Means, you can’t touch it anymore.
So, it’s always better for you to invest only an amount that you can bear to lose. And you need to consider the fact that the loss doesn’t really come when there’s a dip in the market. Instead, crypto traders lose money on a cryptocurrency trading platform if it gets hacked or it has a bug or it’s restructured through some changes in governmental regulations.
Don’t put all your eggs in one basket
Well, this is an old idiom that’s true whenever you’re doing any kind of trading—even the crypto one. In the world of crypto coins, there’ve been some assets whose value has gone up 100 times since its launch. For instance, Verge (XVG) is a privacy coin whose value has soared up to 13,000 times since its launch. So coins or numbers, like these can tempt newbies to put all their money on a single asset.
That, however, shouldn’t be the case. Investing in a single digital asset isn’t the wisest thing to do. To get started, invest a minimal amount of your money on a coin that’s doing well at that point in time. On the contrary, your portfolio should even carry some upcoming crypto coins whose value may improve in the coming time.
Overall, you’ve got to do some heavy analyses to make sure that your money is put on coins that’ll likely give you a higher return.
Take profits at a small interval
Undoubtedly, crypto is a super-crazy land. Here, you’ll see some coins getting a hike of up to 30 per cent in a matter of just a couple of hours. During such times, crypto investors tend to become greedy. And that’s when they hope to earn a few more bucks by holding on to their investment for some more time.
But that shouldn’t be your strategy. Instead, your strategy should be to get as much profit as it’s possible at regular intervals. Once you do that, you’ll be able to save a lot of pain that’s usually felt when you lose a lot in one go.
Plus, getting regular profit will even help you stay motivated. How? Well, getting regular profit will let you remain upbeat about the fact that you’re living the uncertain life of a crypto trader.
So here are the three golden rules that you should always keep in mind while speculating in any cryptocurrency trading exchange in Australia or elsewhere.