Hi everyone. I wrote down these 10 lessons for trading crypto to remind myself... and I want to also share them here to help anybody who may need this info.
Also, I'd love to get feedback from more experienced traders about these points...
Let me know your thoughts, and feel free to share with anybody who can benefit.
Make sure your initial investment is an amount that wouldn't break you financially if you lost it all. There is a lot of learning to do, especially at first. So only risk what you are willing to lose. This will keep you from trading emotionally. Remember, you can make money with $100 if you trade skillfully. That can grow to a significant amount. Be patient and respect every dollar you trade.
Profit more, trade less. Don't try to catch every swing. Wait for big moves. Buy during the big dips and crashes. Check the 1day candle chart and plan your moves long term. A few good, smart trades a year can be more profitable than trading every day.
Don't check the prices and charts incessantly. Check the prices a couple of times a day. When big moves start happening, then follow the movement closely. Crypto is addicting, and each time you check the price you get a dopamine release. Make sure you're also doing things in life other than crypto and don't get obsessed with it for too long. It will burn you out. Balance it with other activities in life, and work.
If you don't catch the exact top or bottom perfectly, don't beat yourself up. It's impossible to predict them with accuracy every time.
When you're ready to buy or sell, check the charts and see where the large buy or sell orders are sitting. There are very smart people out there, and there is a reason why there is a lot of money sitting at those numbers. And watch carefully as the numbers are adjusted when the price gets close. There are very skillful traders behind those orders.
Only buy in the red, and only sell in the green or in the initial phases of red.
Those who make the most money in crypto are those who HODL long term. But if you missed the boat in the earlier years, then buy during a crash or dip, and hold on until the next crash or dip. Buy low, sell high. Rinse and repeat.
Read the news every day. If a big negative, or positive, story comes out it will take some time for it to take affect. Crypto is a 24/7 worldwide market and traders are on different parts of the globe. When you're sleeping, the other side of the world is trading, and vice versa. Buy the rumor, spread the news... as it has been said. But don't always take the news too literally, but as a strong signal at times of big stories.
When trading, don't sell or buy all in or all out. Spread your orders out a bit so you can take advantage of fast price changes when the move is happening (either bear or bull). Usually when a transition is happening, up or down, the price is very volatile. You might find that you buy thinking it's a good price, but then the price goes down significantly. Or you sell, and the price goes up. Not a nice feeling. Spread your orders out so you can cover those risks.
Check the total market cap (of the whole market) on CoinMarketCap often. Usually, movements are strongly correlated with the total market cap.
Trade wisely,