For some time now, I have been closely watching the performance of cryptocurrencies to get an idea of where the market is heading. The routine my elementary school teacher taught me, where you wake up, pray, brush your teeth, and eat breakfast has been changed a bit to waking up, praying, and then going to the web (starting with coinmarketcap) just to find out what crypto assets they are in the red.
The beginning of 2018 was not a pleasant one for altcoins and related assets. Its performance was affected by frequent views from bankers that the crypto bubble was about to burst. However, the passionate followers of cryptocurrencies are still “HODLING” and, truth be told, they are reaping great rewards.
Recently, Bitcoin fell back to almost $ 5000; Bitcoin Cash approached $ 500 while Ethereum found peace at $ 300. Virtually every coin was hit apart from the newcomers who were still in the excitement stage. At the time of this writing, Bitcoin is back to normal and is selling at $ 8,900. Many other cryptocurrencies have doubled since the uptrend began and the market cap is at $ 400 billion since the recent peak of $. 250 billion.
If you are slowly approaching cryptocurrencies and want to become a successful trader, the following tips will help you.
Practical advice on how to trade cryptocurrencies
• Start small
You’ve already heard that cryptocurrency prices are skyrocketing. You have probably also received the news that this upward trend may not last long. Some critics, mostly esteemed bankers and economists, often call them get-rich-quick schemes without a stable foundation.
This news can cause you to invest hastily and not apply moderation. A little analysis of market trends and cause-worthy currencies to invest in can guarantee you good returns. Whatever you do, don’t invest all your hard-earned money in these assets.
• Understand how exchanges work
Recently, I saw a friend of mine post a Facebook feed about one of his friends who happened to trade on an exchange who had no ideas on how it works. This is a dangerous move. Always check the site you want to use before registering, or at least before you start trading. If they provide a fictitious account to play with, take the opportunity to learn what the board looks like.
• Don’t insist on changing everything
There are more than 1400 cryptocurrencies to trade, but it is impossible to deal with all of them. Spreading your portfolio to a large number of cryptocurrencies that you can effectively manage will minimize your earnings. Just select some of them, read more about them and how to get your trading signals.
• Staying sober
Cryptocurrencies are volatile. This is your downfall and your blessing. As a trader, you need to understand that price shocks are inevitable. The uncertainty about when to make a move makes one an ineffective trader. Take advantage of hard data and other investigative methods to ensure when to execute a trade.
Successful traders belong to various online forums where cryptocurrency discussions on market trends and signals are discussed. Sure, your knowledge may be enough, but you need to trust other traders for more relevant data.
• Diversify significantly
Virtually everyone will tell you to expand your portfolio, but no one will remind you to deal with currencies with real world uses. There are some shitty coins you can deal with for quick cash, but the best cryptocurrencies to deal with are those that solve existing problems. Coins with real world uses tend to be less volatile.
Don’t diversify too early or too late. And before making a move to buy any crypto asset, make sure you know its market capitalization, price changes, and daily trading volumes. Maintaining a healthy portfolio is the way to make big profits from these digital assets.
