There is a lot of money to be made in Bitcoin trading. You can make profits by trading the digital currency, either as a short-term speculative investor or long-term investor. Whatever route you choose, taking the plunge and investing your money in Bitcoins can be very stressful and challenging. This is because of the history of Bitcoins which has been very volatile, the intrinsic unpredictability of the cryptocurrency markets and the Blockchain technology which many Bitcoin enthusiasts are not familiar with.
Thankfully, there are several resources on the Internet which can help you become a successful Bitcoin investor. It can also help you on how to find good ICO to invest in. To get things started, here are some of the tips that you can use to turn the inherent volatility and complexity of Bitcoin trading in your favor.
Bitcoin trading works differently from stocks and other financial commodities. That said, you need to understand how the system works before you plunge and invest your hard-earned money. Understanding how Bitcoin work can help you avoid common pitfalls.
2.Set goals for each Bitcoin trade
Setting goals will help you remain calm when the digital currency in the periods of extreme volatility. You need to determine what price to cut losses or take profits in advance when placing a Bitcoin trade. This way, you will easily prevent trading actions based purely on emotions. For instance, if you don’t have any target price, you may become greedy and probably fail to realize your profits while the favorable market is still on your side.
3.Know when to buy Bitcoins
Even if there is no general rule as to when to purchase Bitcoins, there is always a good time to do so. Usually, it is not a good idea to buy your Bitcoins during peak times or when the market is crashing. In fact, the best time is when the price is stable. So you need to determine when the Bitcoin price is at bubble stage and when the market is crashing.
4.You need to be cautious
There are several stories on the Internet about individuals who became instant millionaires after investing a few dollars in cryptocurrencies. These stories are sweet but don’t be tempted to spend vast amounts of money on digital currencies when starting out. As a beginner, you need to test the waters with a few dollars. Otherwise, there are many investment strategies for Bitcoins that offer the most success you can utilize.
5.Never invest more than you can afford to lose
Any financial investment can produce returns as well as losses. Bitcoins trading is one of them. It is a highly speculative investment, so there are high chances of making huge profits by utilizing right investment strategies or losses when you make poor decisions. You should, therefore, invest an amount that you feel comfortable losing in case of the worst happens
Successful digital currency traders advise beginners not to put all their eggs in one basket. This means you need to create a diversified portfolio when trading in digital currencies. So instead of trading in Bitcoins only, you also need to have a simple collection comprising of equal amounts of other digital currencies such as Litecoin, Ether, Bitcoin Cash and more. This way, you will avoid total loss in case the price of one cryptocurrency declines.
7.Don’t set stop losses too low
When trading in Bitcoins, it is advisable not to set stop losses too low. The power of stop loss in Bitcoin trading is to liquidate your financial position if your losses reach a specific value. They help digital currency investors to limit losses when the market is down or lock in gains when the market is favorable.
8.Learn how to read Bitcoin charts
Experienced traders concentrate more on the technical aspects of the charts to identify the market trends. As a new Bitcoin trader, to identify market trends you need to understand the basics of chart reading. Some of the basics you should understand include candlesticks, opening price, closing price, price direction, highest price, lowest price, trading range, and order book.
Starting your cryptocurrency journey with Kryptoia
Trading in Bitcoins can be very stressful and challenging. Same goes with creating an ICO fundraising campaign. To avoid this stress and hassle, you can begin your cryptocurrency journey with Kryptoia. They offer the most effective marketing strategy to get the best results for your business to ICO. Check out their site now.