Simple Guide to Day Trading Bitcoin and Other Cryptos
Cryptocurrency trading is not something you delve into without a plan. You need a guide that assures you incur minimal losses when trading. There are two things that are crucial for you to determine before you start trading. They are:
What drives you to trade cryptocurrencies?
It is a simple question, but you need to answer it honestly. The cryptocurrency market is still young considering it is less than half a decade old. All the same, it has more press coverage and column inches than any other assets class in the past couple of years. The coverage varies from gloom and doom and has “bubble bursting” predictions. There are tales of instant millionaires who have high-end supercars and a jet-set lifestyle. These should all be ignored.
You should know crypto trading is a volatile marketplace. As such, you should be comfortable with dealing in a volatile market. It does not matter your choice of trading and your commitment. You may want to be a full-time trader, part-time trader, long-term investor, short-term trader, or someone who is interested in the cryptocurrency space. Whatever your choice, you need to be completely comfortable with a volatile marketplace.
Have a dry run
Running and practicing is the only way you can be confident and comfortable with the market. Majority of successful traders attribute their success to learning and practicing. One of the benefits of practice is it breeds confidence. For starters, it shows you what you are doing right. Secondly, it helps you ingrain the right moves in your daily trading activity.
One of the most important aspects of learning and practicing is understanding where you go wrong. To make sure you are on the right track, do not forget to use online trading academies. They are an invaluable source of information. This means you should use them as often as possible at every stage of your trading journey.
As a new trader, it is advisable to open a Bitcoin trader demo account before you commit any of your money. The account can be used to apply a variety of technical trading techniques combined with rigorous fundamental execution set-ups and market analysis.
When you are learning you can remember how you arrived at a point by making a record of losing and winning trades. Make sure you include the reason why you specified specific loss and profit limits as well as why you entered the trade. Other things to include are how you felt after closing a trade and why you decided to invest a specific amount of money.
Ensure you are honest in your records. They will assist you by providing real-life examples of why and how the trades went wrong or right. Never take shortcuts during your trading analysis. Taking note of your mood will affect your trades. Try and avoid being in a rushed or bad mood as you trade. This move will ensure you trade with the right mindset. It will also prevent you from making mistakes associated with bad emotions and feelings. Lastly, you should never trade when you are ill or tired.
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