Adopting a Millionaire's Mentality on Cryoto Tradinf

Many – if not all – cryptocurrency traders, buyers, and enthusiasts hope to become cryptocurrency millionaires.

Despite this, the odds are stacked against you.

In this guide, I'll show you how to adopt a specific mentality to avoid being duped by short-term price action.

I'll try to answer if it's possible to change your attitude and behave like a millionaire before you really become one.

As always, the techniques discussed here are intended to be informative, and this article should not be construed as financial advice. Never put money into something you can't afford to lose.

The Right Strategy

In this segment, I'll go over a few different trading strategies and how to choose an exit strategy. The first two are better for bull markets, while the third is better for bear markets. Of course, any technique can be used at any time of the year. The only stipulation is that you keep your sights on the prize, which we'll go over later.

Margin Trading

When you trade with leverage or margin, you're basically borrowing money to leverage (or increase) your position. In other words, the amount of times you're exploiting your holdings multiplies each percentage point gained. When you use 10x leverage, for example, a 1% change becomes a 10% change. Of course, if the market moves in the opposite direction, each percentage point loss is compounded as well. And, depending on how much leverage you use, you may be able to liquidate all of your assets. The higher the leverage, the more likely it is to be liquidated.

Dollar Cost Averaging

Dollar cost averaging is simply buying Bitcoin, or any other cryptocurrency, on a regular basis. It is regarded as a "safe haven" for long-term investors. This can be done on a regular, weekly, or monthly basis. Usually, supporters of the latter technique tend to plan transactions on particular days and stick to it – much like a direct debit. Purchases are made at exactly the same hour each time, ensuring that the commodity is purchased regardless of the short-term price.

One of the best methods is the DCA, which lets investors and traders become less emotionally attached to their investments.

Buying the Dip

Purchasing an asset after it has depreciated in value is referred to as "buying the dip." Depending on the case in which it is used, it has various contexts. Some traders can claim to be buying the dip even though an asset is in a long-term strong uptrend in the hopes that the uptrend will continue after the minor dip or decline, according to Investopedia. Others will use the term when there is no current uptrend but assume one will develop in the future.

Buying the dip can work if investors are disciplined enough not to succumb to the temptation of buying at the wrong time, such as during prolonged bear markets.

Short Trading

When a trader employs a short strategy, they are betting against an asset's price. This technique would be used, for example, if you were expecting a Bitcoin bear market.

Because of the uncertainty of cryptocurrencies, short selling may be difficult. Since it's better to go with the cycles rather than against them, this technique is most widely used during bear markets – or when traders expect one.

Focus on Your Goals

You will fail no matter how good a technique you choose or how many good entry points you have if you do not know how to:

A) Decide on an exit strategy: Knowing when to enter is less critical than knowing when to exit. Have a collection of crypto-assets ready to sell at a particular price range at all times. Otherwise, the chances of missing out on the best trading days skyrocket.

B) Think long-term: Cryptocurrencies are the most unpredictable asset I'm familiar with. Also during major bull runs, you can expect price drops of 30 percent to 40%. You're more likely to sell at the wrong moment if you don't keep your sights on your long-term target (the price point you're shooting for).

By following this guide, you should be able to make better decisions about which strategy is best for your risk profile and when to enter or exit a market.