It is said that hindsight is 20/20. For anyone who doesn’t know what that means, it’s that we have perfect vision when looking back at our history. How many times have you thought about going back in time to tell your younger self to pick a certain route? It might have saved a lot of heartache, right? This goes for crypto trading. There are five main things I wish I knew before I dove in, taking hard knocks along the way.
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To start, let’s just say that for every venture in life there have been times where I consider myself lucky and other times when I fell flat on my face. Embarking on new enterprises without a good amount of research is kind of stupid because, when it comes to money and investing or trading, there is a certain amount of prerequisite knowledge that you should have before entering the arena.
Herein lies a lesson: For every dollar out there, there’s a fool who will part with it. At some point we all play the fool – and that’s okay! That’s how we learn.
As a crypto trader, there are no schools to teach you the ropes. Most of the time you have to rely on good intel and do a lot of research to wade through the thousands of crypto assets you could throw money at. But if you want to be successful at crypto trading, then here are five things to keep in mind.
Start Small. Don’t Focus on Making Big Money Yet
Admittedly, trading is about making money but when you’re starting out, it’s wise to start small. Forget about making big money right out of the gate, unless you have untold riches stashed somewhere. To stay in the game for a long time, you have to take it one step at a time.
The idea is to get you to prove that you can trade successfully before you start putting in more money. Your first few trades will get your past the learning curve if you’re new to crypto trading. Take it as a lesson, not so much as serious trading.
Focus on the Risk
Forget about the size of the account and focus on risk management. Risk management counts for a lot in trading. Even if you have the best system in the world, if you have a poor risk management strategy, you will blow your account to smithereens.
Develop a system that helps you manage risk with the understanding that the worst-case scenario is that you lose the money you were trading with, plus fees. Design a risk management system that allows you to face the possibility of losing all the money you put in without losing your home.
In essence, don’t put all your eggs in one basket and definitely don’t risk your start up trade money on one trade! This isn’t roulette, okay?
Understanding the real risks can keep you in the game longer than most. Trade to grow your account. You do that by not being stupid about it.
Filter Out the Noise
There is so much information out there; newsletters, blogs, news, gurus, analysts, patterns, videos, etc. If you are not deliberate about the type and volume of information that comes to you, you will be bombarded with so much noise that you lose focus on the important thing. However, if you want to make it, you have to cut out the noise.
Cutting out the noise doesn’t mean shutting yourself out from relevant information. The idea here is to only deal with information that will help your trading. If you want to follow a guru or subscribe to a newsletter or blog, by all means, do. It is crucial to get as much relevant information as possible – but also use your head.
It’s okay to get information from the blogs or newsletters, but then turn your attention to the market and turn down the noise from everything else.
Stick To One Trading Strategy or Method
When we venture into new territory, it’s really hard to stay on track when all you want to do is explore. There’s an old adage: jack of all trades and master of none. Sure, you can throw yourself at all the markets and dip a little into each asset. What you’ll get is a overwhelmed with the sheer amount of tracking you need to do to become successful.
Stick with a couple of assets. Find your rhythm in trading. Be consistent and develop good trading habits. Try sticking to specific trading pairs so you don’t get confused with crypto prices.
Focus on one market, one strategy, and one method. You have to be prepared and willing to channel all your energy into a few and become a master at it before expanding into other areas.
And if you want to be a day trader, by all means, become a day trader. Don’t jump around. Success is gotten by mastering a strategy and a market.
It’s a Marathon Not a Sprint
If you’re starting out with a crypto trading plan then I hope you’ve got a long-term goal because that’s what it might take to really grow your trading portfolio.
Short-term plans are fine if that’s your goal, but making money in these markets takes time and patience. You see the volatility in the Bitcoin markets, right? If you’ve been investing over time, then you’re probably doing well in the scheme of things.
Too many traders quit way too early. They get frustrated that they’re not seeing results and BOOM, that’s it. You’ll never be a success story if you outright quit. Crypto trading takes time. It could be months. It could be years. If that’s not for you then you might want to consider investing your money elsewhere.
This all kind of speaks to mindset in trading. If you have the long term in mind, you will more than likely take it one step at a time. Patience is an excellent asset in trading. With a long term perspective, you won’t be rash in taking risks. With long term in mind, you are more likely to start small knowing that you still have many years ahead to grow your account.
Happy trading!
Disclaimer
Content provided by CryptoTraderNews is for informational purposes only, and should not be construed as legal, tax, investment, financial, or other advice. All information is of a general nature. As always, there is risk with any investment. In exchange for using our products and services, you agree not to hold CryptoTraderNews Pro, its affiliates, or any third party service provider liable for any possible claim for damages arising from decisions you make based on information made available to you through our services.
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