“The key to trading success is emotional discipline. if intelligence were the key, there would be a lot more people making money trading”
1. Expect the Unexpected
However, significant instability does exist in cryptocurrency markets which cannot be ignored. Experienced cryptocurrency investors are accustomed to huge price swings that you often don’t find in traditional markets.
The intelligent crypto investor will be able to act realistically instead of emotionally in times of unexpected price drops if he or she mentally prepare for these unfavorable, and occasionally terrifying, investment performances.
2. Determine What Type of Trading Strategy Is Best for You
You can adopt either the long or short-term strategy.
Figure out if you will be going short with every coin that you invest in, or are you going to go long, or some long and some short.
Long-term investors advantaged as they have lower tax rates if they can hold for over 12 months, but they will have to go through corrections as a trade-off.
Short-term investors are able to bypass corrections if they move swiftly, but they’ll be obliged to pay taxes on the profits from each trade they execute along the process.
3. Don’t place all your cryptos in one basket
one of the Essential Tips for Cryptocurrency Investment: diversification is key.
Just as financial advisors recommend taking positions in multiple types of stocks and other investments, diversification is also crucial for any healthy cryptocurrency portfolio.
You’ve done your research, so now seize the opportunity to invest in multiple coins. As one example, you can invest across different sectors which serve different use cases.
Just like it’s always safer to travel as a group then as a single person when you’re in unfamiliar territory, establishing a diversified portfolio will help you along your path toward realizing potential future cryptocurrency gains.
4. Remain careful around mobile wallets
Trading or storing large sums of any cryptocurrency via mobile phone is simply a huge risk.
Mobile phones are more prone to compromised electronically or physically. Although convenient, convenience should not surpass the security concerns that abound with executing trades or storing assets on mobile devices.
5. Don’t Be Governed by Emotions about cryptos
6. Average out your position for cryptos
If you go long, think of adopting an average position, for example through dollar cost averaging or value averaging.
An efficient strategy for avoiding the effects of a poorly timed trade is to buy incrementally instead of all at once which is known as buying an asset at its “average” price over time.
This strategy is useful as this is one of the Essential Tips for Cryptocurrency Investment.
for those that do not have knowledge of technical indicators and how the crypto market’s instability works, think of averaging out of positions as well.
Averaging also lessens the stress that put on you when the market fluctuates. Adopting a position which is too big at once can be emotionally difficult to handle.
and will eventually lead to you making a bad decision.