The world of crypto trading can be volatile at times. Compared to standard stock trading, it’s often described as ‘the Wild West’. However, there is some order to the chaos that goes on within the world of cryptocurrencies.
Being able to make sense of the market can be an extremely lucrative skill. Today we’ll try and help you become a better trader. What follows is a set of tips and tricks that will help you boost your Bitcoin trading game in the long run.
If there’s one piece of advice that can make you a better trader practically overnight, it’s to be realistic with your trades. What exactly does this mean?
Being realistic can apply to many aspects of trading. You need to set realistic boundaries, know your limits, and manage risks. Don’t spend money you don’t have on positions that have a slim chance of working in your favor.
The key to making money in crypto is to be calculated in your trades. If you can master your own ego, you’ll already be far ahead of your average trader. This is amplified tenfold if you’re a day trader.
Master the Technical Analysis
Technical analysis is still a solid way to predict trends and stay on top of active patterns in trading. Most of the lessons learned in stock markets over the years apply to crypto as well. However, it’s worth noting that crypto requires a different take on technical analysis.
Expert opinions are generally divided when it comes to this issue. Some claim that religiously following the TA dogma works wonders even in crypto, while others feel that TA has no real use in crypto.
The truth is somewhere in between. TA is a fundamental skill. It allows you to create solid footing in the world of trading, which you can use to further develop your skill. Using technical analysis in combination with other methods we’ll talk about later is a good way to become a better trader.
All of that being said, the knowledge evolves. Technical analysis is adapting to ever-changing crypto markets. The sheer volatility and the unpredictable trends in crypto demand this. At the end of the day, learning the basics of TA will absolutely help you make sense of various graphs and developing trends.
Find a Good Trading Platform
Finding a good trading platform is key. Becoming a better trader requires an environment that is consistent in terms of security, but also one that offers a big enough volume of trade. Analysts over at insidebitcoins.com believe that selecting the right platform is one of the most important steps when it comes to trading.
What you’re looking for is an environment that has all the currencies you’re interested in, as well as a reliable infrastructure. No amount of skill, pattern recognition, or technical analysis will help if your trades are stuck pending due to a slow system.
Do your research and find a platform that best fits your needs.
Follow the News
There are countless instances of coins mooning within minutes because of an article, piece of news, or even just a tweet. Staying on top of the industry news is essential if you want to catch non-organic spikes in value.
The same applies to Bitcoin. Despite being the largest cryptocurrency in use today, BTC is still very much suspect to news and volatile tweets. Because of that, it pays to be subscribed to the most relevant industry news sources, tweet accounts, and other potentially useful media.
Never Trade More Than You’re Willing to Lose
This one should be a given, but you’d be surprised how many traders fail to stick to this simple rule. Never trade more than you’re willing to lose.
We fully understand that markets are full of highly tempting situations where you might see a x10 return on your trade.
This is especially true for some of the more volatile altcoins. However, it’s much better to make a good trade with 20% of your capital, than it is to go all-in and potentially end up liquidated.
Learn When to Bail
Buying into a risky coin takes guts, but knowing when to cut your losses and bail takes courage. One trait that separates experienced traders from newbies is knowing when to call it quits.
Trust your gut feeling and accept the fact that you’ll pull out of a position prematurely from time to time. That’s just the cost of doing business and it ties into our next point.
Learn How to Take a Hit
You’ll make bad trades. That’s a simple fact and a truth that no trader has yet managed to escape. It’s not a matter of if, but when it will happen. Making a bad trade doesn’t define you as a trader. However, how you deal with such a trade does.
It’s important to learn how to take a hit and move on. Dwelling on a loss creates a toxic mindset that will make you second guess your decisions in the future. No good has ever come from that.
Sure, there’s always a lesson to be learned when you make a mistake, but don’t let that mistake dictate your trading. Be realistic in success, but in failure as well.
You Can Become a Better Trader
Despite how chaotic crypto is at times, you can become a better trader. It is an actual skill that you can sharpen over time. The tips we’ve shown you above are just some of the more fundamental traits of a good trader.
As you develop and progress your skills, you’ll learn more advanced techniques and more importantly, develop a sense of the market. Top dogs in this business have the ability to feel changes and emerging trends as they’re forming.
You’ll develop that skill too, given enough time, experience, and work. Your journey will have its ups and downs, happy and sad moments, but you’ll succeed as long as you keep your sight on the prize.