We have all seen the hype around Cryptocurrencies and Bitcoin trading. Huge gains, but also big losses. With this in mind some people have been wary of making the step into the world of trading. Here we will take a look at tips to get you ahead and comfortable in this world and look ahead to making a return on your investment.
Do your research on the market ups and downs
There are no shortcuts when trading in Bitcoin. You need to know the market and study the trends. Whilst the growth has been exceptional, this currency can also be volatile. Having said that, it can perform even when most markets are struggling in the current COVID-19 crisis. For example, we have seen a large jump in the value of Bitcoin reaching a value of $17,492 – a four fold increase since March 2020.
Invest in technology
A great way to manage your investment is by using specialist trading software such as the bitcoin evolution app which uses algorithm software to scan the crypto markets to find potential profit opportunities. No matter how much studying of the markets we do, these specialist apps can help find opportunities everyday people may miss.
Protect your investment
As we have mentioned, crypto markets can be volatile so it is wise to protect yourself against any large losses by using Limit and stop-loss orders. Limit close orders will close your order when you have reached a set increase in your favour. Stop-loss orders work at the opposite end of the spectrum and will activate when stock drops to a predetermined amount. For example, you may buy a stock and place a stop-loss order 10% below the purchase price. Should the stock drop, the stop-loss order would be activated, and the stock would be sold therefore reducing your investment losses.
Price alerts are also a wise strategy as they will notify you when the market has moved in a certain direction so you can make an informed decision on when to buy or sell and you can be notified via email, text, or through a trading app.
Trading mistakes
- Not having a plan
A fundamental of trading is to have a plan and reason why you are investing. Making an investment without reason is a sure fire way of a short lived career in cryptocurrency trading and loses with it.
- Stretching the budget
A common mistake is getting caught up in the moment and risking more than you can afford. Set the budget where you are comfortable and know your limit. There is risk in trading and over stretching your budget will impact the decisions you make.
- Leaving money on an exchange
A serious mistake is to leave money you are not trading with on an exchange. If an account gets hacked or goes out of business, you risk losing your money. Only have the money you are currently trading with on an exchange.
- Not learning from mistakes
There will be mistakes along the way and it is crucial that you take them on board and learn from them. Like the Billy Joel song says, ‘You’re only human, you’re allowed to make your share of mistakes. You’ll learn more from your accidents than you’ll ever learn at school.’ This will enable you to become a better trader in the future.
Conclusion
Cryptocurrency trading can take time to learn so be patient. Take advantage of any tools and blogs that will help you learn the markets. The more you explore the trends, the more you will learn. There will be profits and losses along the way, but the more time you spend trading the better equipped you will be in the future.
This isn’t a magic way to make money, but it is a way that everyday people can make money that wasn’t really accessible in the past. Trading has typically been seen as a way that money has been made for the rich. However, with the technology advances with trading apps we can all now have a go. Remember – it can take time, and always do your own research.
