Trading crypto is more than just a popular trend, it’s also extremely tricky and can ruin your personal finances if you’re not paying attention. As such, you have to trade crypto the right way!
Unlike trading currency via the best forex brokers out there, trading crypto is much more volatile. If you already own crypto, you might be aware of the kind of crash that’s probably made you look at your e-wallet with sadness.
In order to avoid losing money while trading crypto and being forced to just sit and wait for an increase, we’ll now introduce you to some things that can help you trade crypto the right way!
Trade Only What You Can Afford to Lose
Obviously, the rule of thumb when trading (more than just crypto) is to invest only what you can afford to lose. Clearly, not many people agree with the fact that they could afford to lose money, but it’s a mentality that you must master if you want to avoid disappointment.
We mention disappointment here because you will face it many times while trading crypto. You might either lose the wave or ride it down, in both cases, you could be losing money, according to crypto terms.
Research before Trading
Crypto and forex brokers reviews will always tell you that the broker doesn’t take responsibility for your trading decisions. Naturally, you can’t blame the middleman for your bad choices.
This is why you have to study the market and do your research before trading, especially when trading crypto. Don’t jump on the crypto train just because of a rumor or Telegram post. Trade only when your decision is backed by solid knowledge and extensive research.
FOMO is Bad
Just as we mentioned above, don’t jump on any crypto trains! Resist the fear of missing out and never think that if you don’t buy a coin right now, you’ll regret it for your entire life.
If we were to always rely on that logic, then we’d regret every single action we make and don’t make. You can buy today at the lowest price in the history of a coin and tomorrow the price can drop to a new low. The key is to not regret your moves but to make the best out of them.
In any case, avoid giving in to the fear of missing out. You’re not missing anything – crypto will be here for a very long time; you will have plenty of opportunities to trade.
You Don’t Have to Buy a Whole Coin to Own Crypto
Many beginners have the impression that they need to own a whole coin (regardless of the name) in order to actually be trading crypto. Naturally, after a couple of learning lessons in the future, this perception changes entirely.
In fact, many trading platforms will convert your portfolio into Bitcoin (just for the visuals’ sake) so that traders can see how much Bitcoin they own in all the coins they have. As such, you can have 10k random coins and only 0.3 BTC in the end.
The number of coins doesn’t matter – their value, on the other hand, does.
The Bottom Line
In many cases, traders nail the basics of trading and make a profit faster than conventional traders, so to speak. However, what gets to them are the mind games used by other traders – namely FOMO, rumors, and the likes.
Peer pressure and bias are often the main reasons why crypto traders make bad decisions.
