Trading Cryptocurrencies with planning
Cryptocurrencies are nowadays a hot thing in the market, everyone wants to trade crypto by looking at its lucrative returns, but do you think its as easy as we think to trade crypto? certainly not, its not as much easy as we think, it requires proper knowledge of everything like charts , orderbook , buy sell walls, then also many people loose here because its very small market and whales manipulate in their own way, so here we have to trade in an efficient manner, in crypto world there are double profits and double loss, so always we have to trade it in a planned manner.
Why people loose i am listing some points
- Buying in fomo
Many people buy the coin in fomo, whales artificially pump the coin and people buy out of fomo to see its growth, people have a mentality of fast returns and this all because of short term greed, so those people who are too greedy they loose here in short term.
- Selling in panic
Okay people bought in fomo, and after they bought , coin start loosing its value, now patience will be tested, either you hold or do panic sell, now again greedy nature comes into play as when coin start decreasing in value they panic sell to prevent further losses.
- Trading in bad projects either fundamentally or technically
When you trade in bad projects, the project which dont have any hype or team is inactive then chances are less that it will again gain its original value.
- Less or no research
Many of us don’t research about the project, its whitepaper, team strength, its marketcap and many more things to look out and end up buying a bad crypto
What to do for becoming a successful trader/investor ?
- Always trade/invest in good project: Don’t trade in bad projects, if you invested in good projects then you can sleep with no worries and if your coin went down then it will come back if project is technically and fundamentally good.
- Never ever chase the price : Don’t chase the price, no matter how much the coin is pumped, nothing goes parabolic, if it goes then it has to come down, so if you like any project and watching its price going up, just relax and do your research, analyse where the train will stop , find next resistance, find a good support then enter in it a good support level
- Dont sell in panic if you bought a coin : if you bought any coin, then dont sell in panic as when you sell coin will go up , so wait for it to grow, and if you have i nvested in good project then surely it will go up someday, so dont do panic sell if invested in good project
- Check out everything : Check each data of that particular coin, analyse every parameter like team is good at responding in social channels, their github activity, how good is their team, advisors, their is a good website i came across for checking and analysis of project Coincheckup , this website has all the data as for making right choice about our investments.
- Check out ico price if project is new : Check their ico prices in eth , btc and dollar so that we can take a correct decisions where to take entry in that particular coin, old projects nothing have to do with ico price so much for now, there are many websites which provides us ico data one of the website called Coingecko , if it is near ico price in dollar or eth or btc terms its a wise decision to get in that project but the project should be good if you are a hodler
- Do some technical analysis : Do some technical analysis like finding support , resistances , rsi, dont use many indicators use only 2 or 3 indicators , the more you use indicators in tech analysis, the more messy the chart become and you will get confused, so in my opinion use less indicators, the main thing in tech analysis is finding good support and resistances.
- Analyse order book : From a traders prospective, analyse order book, find out good support or you can say good buy bids area so that you can enter, analyse fake and real walls.
- Diversify investments : Diversify your investments in 4–5 coins depending on your portfolio, don’t go all in , in one coin, its crypto market , here is the maximum volatility , when you go in one coin and you got another opportunity to buy then you can’t do investment in that second coin, so always diversify to minimize losses, and keep some extra fiat for good opportunities or to make average if that coin went down and hold.
- Research in bear market : I have seen guys don’t talk in bear market, in fact bear market is the most suitable time to research and invest in your favourite projects and we get projects at good discounted price, remember if your entry is good then you don’t have to worry about the price movements, always buy in fear or we can say in bear market to be different from 90% crowd to make massive returns.
- Controlling emotions : Last but not the least , you guys should control your emotions, i know its an human behaviour we approach those projects which are already pumped or hyped and then we make losses because of greed, so control your greed and relax and research and wait for that coin to come down and invest with proper research , follow strategy buy the fear sell the greed
- Still you can’t control your emotions?
Do MEDITATION in the morning.
This is not a financial advice, these are my personal opinions, do your secondary research always