So, you’ve decided to learn about cryptocurrency and how to trade? This is a crash course in cryptocurrency and trading. You will not become a master overnight. It takes months of practice and strong hands. You will need to learn how to read charts, technical analysis, research coins, read markets and trends, follow social media influencers, spot pump and dumps, spot a scam coins, and more. Bitcoin is becoming very mainstream, and everyday more and more people are jumping on the bandwagon thinking it is a get rich quick scheme. You will find out very quickly, if you approach cryptocurrency trading this way, you will lose very, very quickly.
Before even buying Bitcoin or any Altcoin, it is suggested that you read through the the materials at your own pace. You will not become an elite trader overnight, and it will take months of practice and discipline to return gains. That being said, you will not win every time, even if you have the best trading strategy ever. The market is very volatile and swings and crashes can happen at any moment.
At the time of writing the current Crypto-Market cap is sitting at $200 Billion with a daily average of $10 Billion traded daily. This kids, is no walk in the park. There is serious money being played with here.
Please take this information lightly and continue to use other resources throughout the internet to help gain knowledge in trading. We accept no risk for your losses, as this content is purely for educational purposes only.
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BEFORE EVEN STARTING ANYTHING,
WE HAVE 3 RULES TO FOLLOW BY;
RULE #1 – ONLY INVEST WHAT YOU ARE WILLING TO LOSE
With any investment whether it be stocks, bonds, forex, or crypto, rule number one is, only invest as much as you are willing to lose, because there is always a risk. Crypto trading is like the wild west, unregulated and very volatile. Markets can move without warning, can be pumped and dumped, exchanges can get hacked and go bankrupt, the whole market can burst, governments can ban it, and the list goes on. Trading is not for the faint hearted. BE PREPARED TO LOSE YOUR MONEY.
RULE#2 – EMOTIONS DON’T BELONG IN TRADING
One of the quickest ways to lose your money is with your emotion. The place where most people get caught out is during a pump & dump. They get FOMO(fear of missing out), and by the time they see what is going on, they have bought into the peak of the pump and the coin then dumps, bye bye money! If you are an emotional trader, you will lose your money, and you will lose it fast.
Before you buy into any coin, you need to ask yourself why? Why am I going to buy this coin? You will need to research the coin, see how it has been trending, what is the development team like, what are the future plans for the coin, is there a large community involved. Then and only then should you choose to buy a coin. Even after all that research, the coin may not go as you may have thought. This is the risk you take with any investment. Then you have to decide whether you hold onto that coin, or sell out at a loss. This decision is entirely up to you. But do your due diligence before making and rash decisions. What is down today, may be up tomorrow. As mentioned before, crypto is very volatile, markets move and adjust very quickly.
RULE#3 – DECIDE WHAT TRADER YOU ARE GOING TO BE
There are two types of traders – long term or day traders. Both trade on the same markets but their strategies are very different. In essence, you should have some long-term coins in your holdings. Some say 50% of your holdings should be put into long term holdings.
Long Term Trader
Long term traders are traders who pick a coin that they see will profit for the long term. They are not worried about the daily swings and are looking to HODL for 6months and longer, possibly even years. Typically, they buy into ICO’s, startups, newly launched coins, or look at trending markets and decide whether or not to go long. You will see the likes of BTC, LTC, ETH, XRP being in trader’s long-term holdings.
Day traders make their money from the volatile market. They will buy and sell coins throughout the day, and profit from the inefficiencies in the supply and demand of the markets. Some day traders even use margin lending to magnify their returns – where small market movements return a bigger profit from them.
Wrapping it up
Comprehendo? Crypto isn’t the get rich quick scheme that everyone has shilled you about. But if you study, create a trading plan, and are consistent, you will be very profitable.
Next we will move onto Understanding Crypto