Nine Key Tips for Cryptocurrency Trading, Learning to Use Them is Profitable!
High returns are often accompanied by risks. I have compiled some investment tips for the cryptocurrency market to share with everyone.
First, Decisiveness
An excellent investor needs to have the quality of decisiveness. When you see an opportunity, follow your instincts and don’t be afraid of losses. Reasonable losses can help mitigate risks, and avoid being indecisive at all costs.
Second, Entry Points
When entering a position, there are two modes in cryptocurrency: bullish and bearish, which can be divided into low buy, low sell, high buy, and high sell. If the trend is unidirectional, all these strategies are feasible. However, in a fluctuating market, avoid low sell and high buy, and refrain from chasing prices.
Third, Position Sizing
Allocate funds in accordance with your psychological tolerance. When positions are too large or fully invested, any change in trend can amplify losses and affect your ability to operate calmly and analyze situations, leading to mistakes.
Fourth, Take Profit
In a unidirectional trend, using trailing stop-loss can increase profit margins. In a fluctuating market, taking profit requires personal analysis for closing positions. During fluctuations, even small profits from each trade can accumulate over time.
Fifth, Stop Loss
Think about your stop-loss price before investing, and set it right after placing the order. If the market doesn’t move as you expected, you can quickly reduce losses and preserve your capital.
Sixth, Frequency
Cryptocurrency can be traded 24 hours a day, so you may miss some market movements. It’s important to manage your trading frequency; excessive trading can lead to errors in technical analysis.
Seventh, Mindset
Mindset is the most crucial aspect of this industry. The amount of money made can affect your mindset, but we should focus on whether we are gaining or losing, rather than how much we earn. It’s better to make small profits than to disrupt your mindset and incur losses.
Eighth, Adding to Positions
In a unidirectional trend, we can add positions in the direction of the trend, but we should not add against the trend. Adding against the trend significantly increases the risk of larger losses, and we should never casually withdraw or alter stop-loss orders for against-the-trend positions.
Ninth, Following the Trend
When the market shows a unidirectional trend, we should not think about adjusting positions at any time. All indicators may show high levels, but they can also diverge, so we must not go against the trend.
