Top Tips For Cryptocurrency Trading For Beginners

top tips cryptocurrency trading beginners crypto traders

Do you want to invest money, but you don’t know how to get to it? Except for real estate, mutual funds and stocks, now you can also make use of a cryptocurrency, which recently has enormously gained in popularity. It’s a medium of exchange, used to secure financial transactions and check the transfer of assets. In contrast to centralised digital currencies and central banks, it’s under the decentralised control. In other words, it’s controlled usually by a blockchain, serving the function of a public financial transaction database. 

The first type of cryptocurrency that appeared on the market was bitcoin in 2009. Since its release, there have been around 6,000 altcoins- alternative versions of bitcoin and other cryptocurrencies, whose values are affected by the value of Bitcoin against the USD. 

If you are a beginner who thinks about getting into the trading world, firstly, you should familiarise yourself with some of the tips that every respected trader should know about. 

Enter Each Trade With A Purpose 

The first golden rule is to enter each trade with a purpose. As obvious as it may seem, some people forget about it. Taking up this activity should be a well-thought decision. Sit and think whether your aim is to day trade or scalp. You should be aware that cryptocurrency trading is a zero-sum game, similar to a roulette wheel in the casino. Someone loses so that someone else could win. 

Now you are probably wondering where you can start this thrilling experience. As it’s a digital currency, you can buy it online, for example at the Paybis, where it’s enough to use your credit or debit card and start a game. How does it work? It’s simple. Firstly, you choose from different cryptocurrencies available, then you deposit a certain number of dollars, and the online calculator estimates how much you receive. 

Don’t Buy Only Because The Price Is Low 

But be careful! One of the common mistakes made by beginners is buying digital currencies only because their price is pretty low. It’s not a good habit, though. An affordable price doesn't always bring you a higher profit. What really counts is the market cap. The higher a coin’s market cap, the more profitable it’s for your investment. Stay focused on crypto signals to help improve your chances of success.

Manage Your Risks 

Also, you should always manage your risks and evaluate what is more worthwhile for you. Experienced traders never reach for massive profits. They rather stick to smaller but sure profits from regular trades. Therefore, every time before starting a transaction, weigh up all pros and cons, and just then make a smart decision. 

Use Stop-Loss Orders 

Another effective technique used in trading is a stop-loss order, thanks to which you can buy or sell a security when it reaches a specific price. Using this method, you significantly limit your loss. Buying a stock, you can always place a stop-loss order, for example, several percent below your price. And then even if your stock drops, the stop-loss will be activated, and the stock sold as a market order. Knowing about this rule, you can save lots of money. 

Be Careful About ICOs 

Being a newcomer in the trade, you may be easily misled by the so-called ICOs, which stand for Initial Coin Offerings. Although they may seem promising since some investors give you a word to allocate your tokens at a lower price and sell them at a much higher rate, most of them are, in fact, scams. Investing in them may cost you even all your savings. 

Use Diverse Cryptocurrencies 

Having acquired all this information, you probably still don’t know what cryptocurrency you should choose, or which of them is the most profitable. All of the digital currencies are quite unpredictable. 

However, as Bitcoin is a determiner of all cryptocurrencies’ values, it’s believed to be the most valuable digital currency on the market. But, it doesn’t mean you should limit yourself only to possessing this one type of cryptocurrency. No, quite the opposite- you should be open to diverse options proposed by digital and cryptocurrency exchanges. The diversification is always demanded in this risky game. The more varied the tokens you have, the more money you can earn. 

Lightning up in cryptocurrency trading is possible and achievable for everyone, even for complete beginners. All you must remember about is to keep cool and follow the tips mentioned above. Forget about Lotto coupons. Instead, invest in some of the digital currencies, thanks to which your financial success will be for the taking.

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