So important for technical and fundamental analysis are also day-to-day business at the Trading more Fundamental, however, is important: How do I invest money so that I go at the end, if possible, with a Plus home?
The Problem is the following: Even if the Bitcoin price, Trend, indicators, or other characters for a certain speaking, can be a course exactly the other direction. This is not just any human fallibility, but also to spontaneous developments, which were not so predictable.
Just small Altcoins have a volatility that is about medium-term time scales are hard to predict. In the regard, it is clear that it takes more than Knowledge of indicators, etc., to operate simply gambling. Something radically expressed:
Trading has always been something to do with luck
Trading with crypto-currencies has always to do with luck: On the Basis of a well-founded presumption, I may invest in a cryptocurrency. This presumption will I receive by means of analysis – be it fundamental, technical or a combination of the two.
But the Basis of my Investments remains what it is – a guess. Therefore, it is good sense to be secure.
Don’t put more money than You lose can
“You gotta loose Money to make Money”: the people, the mouth speaks, and has to be right. Also, a careful analysis can do nothing against abrupt events.
Even if one evaluates a course of development is correct, it may happen that the technology permits, or any unforeseen incidents. Recall, for example, Mt.Gox , or Quadriga.
In the regard, the following rule applies, as a rule, the best: Declaring all in cryptocurrencies Created for you as spending!
The Trading Advisor is at the point, often even stricter, there to read sometimes that you should plug two percent of the Trading of the money available in a Trade. You can see it, but also will help you stay calm.
In the Bitcoin Ecosystem, we are dealing with a market with a significantly lower cost, in which, if a Trade fails, you can be in a Long Position for some time, a frustrated Bagholder in a Long Position, it costs us nothing to hold this Position. Keyword: Hodl!
Invest with a Plan
Who is not familiar with it: Coin xyz shoots in the height and can detect signs to do the same. Either you buy now, excited or is one of the Lucky ones who has already bought. Question: when do you sell?
If you have the time and if you practice Scalp Trading (i.e. if you hold Trading positions for a very short, maximum a few hours), you can try to keep the value. It is observed in the time of the course very carefully and get off as soon as the Situation is delicate.
But if you shop in the morning in a bullish currency and in the evening noted that the Situation has changed dramatically? What do you do then? Wait for better times? Can come, but just in the Shitcoin section, it may be that a Pump-and-Dump scheme came to an end and for the foreseeable future not again.
Therefore, it makes sense to trade with a Plan. A first possibility is, in the run-up to an Exit, a so-called Target, to think about, so when you a Tradeoff. You can do that at a certain value, say around “if the value is x I sell, no matter how the characters are.”
This is the simplest method, has the advantage that you can automate such a Plan in many of the Exchanges. Sure: In a regular rally, you can get off to an early and less profit than would have been possible.
The probability, too late to jump is much lower – all of the victims of Pump-and-Dump schemes will know what is meant. With such a Plan get out, is your own self-confidence a boost – after all, you made a Plan to trade and Profit!
A slightly more complicated method is to Set Stop Losses: Give directly a value slightly below the Low of this and the last day (or the period you to Trade uses).
In the Altcoin-market analyses, we propose each week meaningful entry points, Stop Losses and Targets.
The course should fall below this rate, it will be sold. That way you can prevent significant losses. As long as the (Bitcoin)price up, you can adjust this on a daily basis. In addition, you can keep in time, depending on its possibilities for the Position or continue shopping.
In one of the many Exchanges to automate. On tradingview can at least be an Alarm set, so that you will receive an E-Mail or SMS if the price slips below a preset level. In the latter case, you must be self-employed, but thanks to Smartphone & co. it’s not impossible.
These Stop Losses are important, as we – see point 1 – are only a limited amount of money so that each Loss makes it more difficult to achieve a Profit – which brings us to point three.
Have your money in mind
…primarily in the currency that you take as a Basis for the Trades. If your crypto against US Dollar, US Dollar Bitcoin exchange so, in the case of Altcoins against BTC.
It often happens that one doesn’t hold to items because you call yourself the actual counter value into the memory. Here it may be useful to keep always also potential value gains/losses in the eye.
This includes considering not only the exchange-value but also the Trading, as well as the transaction fees to see how the balance develops.
Consider different Timeframes
During the Trading of Bitcoin and other crypto-currencies, it is useful to consider different time frames: hourly, four-hour and daily candles. The background is that you tried to make a complete picture of long-term and short-term developments.
At the 1D charts (i.e., Charts with daily candles) would be seen in the example of the long-term development, on 240min Charts (i.e., Charts with a four-hour candle) in the medium term, and on 60 min Charts short-term developments. So you can see whether an uptrend or Downtrend is solid, or just something relatively Short-term.
Such a view of price trends at several levels, not just help you to confirm price trends, but also to purchase. We assume, in the sense that the 1D-Chart bullish, the 240min Chart, but bearish. If the long-term Trend, you would have found this a wonderful opportunity to invest in a currency.
Of course, you can from this short-term Trend long-term. Therefore, it is worthwhile to work with such Trading strategies with Stop Losses. So it would be recommended, according to the 1D Charts a Stop Loss should be entered in the from currency, with reasonably low loss out to buy.