Cryptocurrency trading is like any other form of trading. You buy when prices are low and sell when they go high. In cryptocurrency, the buying and selling is done on a platform called an exchange where you can buy a cryptocurrency using dollars or sell it to get dollars. In theory, it sounds like it something that everyone can without any effort, but that’s not the case in real life. Unless you want to make money by luck (which is less likely to happen), earning as cryptocurrency trader will require you to do some homework. However, trading cryptocurrency is not rocket science or something that is only done by geniuses. It simply needs some amount of effort and the willingness to learn daily. If you are a trader or maybe you are someone who wants to start trading cryptocurrencies, this article is for you.

I am going to share with you everything you need to know to be successful as far as trading cryptocurrencies is concerned. I will try to explain with less technical language so that everyone can understand, including absolute beginners.

Tips #1: Only invest what you can afford to lose

Trading is some kind of calculated gambling, and losing is part of the game. If the amount of money you want to invest is an amount you can’t afford to lose, its better you don’t get into cryptocurrency trading. This is not meant to scare you but the reality that you have to live with. Cryptocurrency values are so volatile, and in a matter of minutes, the value of a coin can drop by a huge percentage. They are not like the usual currencies where the fluctuation can rarely reach 5% in a day.

Tip #2: Do your homework before you invest

To be successful with crypto trading, you need to be ready to read the news that is related to cryptocurrencies. It’s from this news and research that you will be able to judge whether a coin is going to increase in value or not. Doing research and analysis before investing is what they call taking calculated risks.

Tip #3: Learn to control your emotions

While doing crypto trading, you will, at some point, be clouded with emotions of greed and fear. For instance;  After doing your analysis and research and finding out that a particular coin’s value is most likely to increase, fear my cloud your mind, and you end up not investing. On the other hand, you may do an analysis that predicts a coin’s value is going to experience a drop in price, but the emotion of greed may make you feel like the value will increase hence to earn you more money and at the end of the day you end up not selling. In crypto trading, you only need to trust your research and analysis, not your emotions.

Tip #4: Don’t invest in only one coin

For the case of beginners, it is fine to start by investing in the cryptocurrency you understand the most. But as you get more experience in trading, you will realize that investing in one coin is not a good strategy. This is because if the coin you’ve invested in gets destabilized by uncertainties like a fork, your business will most likely be on a standstill. So, the only way out is choosing a couple of coins that have the potential of gaining value (after doing research and analysis) and invest in those. The most important thing here is to keep track of the factors that are likely to affect the value of the coins you will have chosen.

Tip #5: Invest with both the short term and long-term perspectives

While investing in cryptocurrency, you need to categorize coins that you can invest in the short term and those you will invest in the medium and long term. However, you need to base these decisions on researched data to avoid making the wrong choice. While researching, you need to identify coins that have the potential to rise in the future and categorize those as long-term investments. More established coins like Bitcoin and Ethereum would best suit to be in short term category since their rates are not likely to change by a significant percentage like those of newer coins.

Tip #6: Set a loss limit

A loss limit is a percentage of the original investment below which you decide to sell the coin no matter the loss. This will mainly apply for coins that you chose to invest in on a short-term basis. It will help also help you avoid getting into a situation where you lose almost everything. The hurdle here will be determining the loss limit. This will require you to do research and studying what has been happening in the past regarding the coins you have invested in. You can always change this value after some time especially when the dynamics in the market change

Tip #7: Be part of other traders’ forums

As a trader, it is crucial to always interact with like-minded people to share knowledge. Being in a crypto traders’ forum will allow you always to be informed about the happenings in the world of cryptocurrencies. This information can be of use as far as making your investment choices is concerned. However, I recommend that you should not take all the information on these platforms as the gospel truth since there are a lot of so-called gurus on these forums and the internet in general that, at times, give misleading information. But you can instead choose to use the information obtained from these platforms to guide your investment research.

CONCLUSION

Cryptocurrency trading is still a very fertile venture to earn you some money online. Many have gained millions of dollars trading, and likewise, many have lost. So, you need to enter the game knowing that if you don’t do your calculations right, you will most likely lose money. For those that are just starting, it is crucial that you start trading with amounts that you can afford to lose so that as you get more experience trading, you can then invest more. For more reliable information about crypto trading, you should always check out this blog.

הפוסט EVERYTHING YOU NEED TO KNOW TO BE SUCCESSFUL AS A CRYPTO TRADER הופיע לראשונה ב-500 Markets Reiviews.

As a cryptocurrency trader, any uncertainty in the cryptocurrencies can be an advantage if you make your calculations right.  A fork is one of those uncertainties that usually happens in the world of cryptocurrencies. A fork in cryptocurrency refers to an upgrade in software that brings about technical changes to the blockchain. A fork can either be a hard fork or a soft one. A hard fork is one that happens after a radical change in the network protocol of a blockchain that makes previously valid transactions invalid and vice versa. On the other hand, with a soft fork, the transactions that were valid in the previous blocks will remain valid even after the Fork. With a soft fork, there’s a consensus of making the software update that will require all those associated with the mining of the cryptocurrency to do. Whereas with a hard fork, there’s no consensus that leads to some of the key players to remain using the old software and features, which in the end leads to a new coin for those using the new suggested features. So, it’s the hard Fork that causes the most instability leading to the creation of another cryptocurrency

In this article, the Fork that we shall give our focus is the hard Fork because it’s the one that causes the most uncertainty about the coin. Whenever there’s a split of one coin into two coins, there will always be either a significant drop or an increase in the value of the primary coin. So as a cryptocurrency trader, you must understand these dynamics. Because you can only take advantage of a fork if you truly understand what caused it and which of the two coins between the old and the new will give you better returns at the end of the day. Let’s look at what you have to do as a trader to benefit from a fork in a cryptocurrency

Safety first! Make sure your coins are in a safe wallet like Nano S wallet or any other secure wallet

Whenever there are speculations of a fork, it is always necessary to make sure your current coins are safe. This will ensure that after the Fork is complete, you can claim your coins and use them to transact. I recommend never to leave your coins in an exchange during a fork. This is because, after the Fork, your coins will remain at the mercy of the exchange, and claiming them might be a bit hard. So, when you suspect any form of Fork in the cryptocurrency you are trading, it is essential you remove your coins from the exchange and put them into a secure wallet. After the Fork, you will be able to claim both coins. For instance, if Bitcoin got a fork today and you have 10 BTC in your wallet, after the Fork you’ll be having 10 BTC and 10 coins of the new cryptocurrency that is formed after the Fork.

Don’t rush to invest in the newly formed coin after the Fork

After a fork, the freshly created coin often comes with more risks on the side of the investors than the parent coin. But you shouldn’t entirely abandon the new coin. You may ideally start your investment with the coins you initially had in the first coin since they will exist both during the Fork and after. Then you start doing your homework about the benefits the new coin has over the parent coin plus what the current people using the current coin say about it. This is because the value of a coin also depends on the demand the coin has. So, a coin that has huge positive reviews will widely be demanded more hence increasing in value

Don’t rush into selling your coins immediately after the Fork

Most people will always rush into selling their coins after the Fork with a fear that the coin may drastically lose value of even cease to exists. But as a wise trader, this is the time you need to start buying (mainly the parent coin).

It should be noted that bitcoin reached its highest ever value in December 2017 just a few months after the Fork. Just before the bitcoin fork in August 2017, its value was around $3000. But during December 2017, the value of the coin was able to reach its maximum of over $19,000. The same kind of scenario happened with Ethereum after the Hard Fork in 2016. So as a trader these trends should guide you on what to do to benefit from the Fork at the end of the day

Don’t trade during the unstable days just before and after the Fork

Another thing you need to avoid is buying or selling coins a few days before or after the Fork. It is always recommended that you take at least three days before and after the Fork without trading. This is because many incomplete transactions happen during this unstable period. So be a little patient during these periods and trade like 3three days or even five safe to be safer.

CONCLUSION

Cryptocurrency trading, like any other trading decisions, are based on speculations. But analyzing the history of events in a particular cryptocurrency and other all other players is very crucial if you want to gain from instabilities like Forks. These are the periods that you have to be sober the most and take decisions after analyzing history and expectations of the future. In most scenarios, it is the old coin that will come out with a higher value after the Fork. So don’t be in a rush to invest in the new coin as most of them don’t reach the expectations of most people.

הפוסט TAKING ADVANTAGE OF A CRYPTOCURRENCY FORK AS A TRADER הופיע לראשונה ב-500 Markets Reiviews.