February 26, 2021
Disclaimer: I am not a financial adviser nor a crypto expert, and this article is for NOOBs only. The information states here are just based on my experiences.
This is a continuation of my article: My Crypto Trading Journey: Did I Succeed?. You can read it so you know what I am referring to.
Every day is a learning process and every mistake has a lesson to learn. That is part of our life and makes us grow as a person. And being in this crypto world is another chapter of my life's journey. Just like in the real world, the way is also bumpy and volatile, it goes up and down, and sometimes it goes sideways. Whatever happens, we should always have something to hold on to, just like how we hold on for our dear life.
What have I learned from my arduous crypto trading journey?
Be Patient
This was the first lesson I have learned from staying in this volatile market. In every pump, there's a dump, I said this to myself before. But sometimes, the excitement in the market will make you lose your patience. Most of us got FOMOed for sure because we do not know when exactly the market will go down or will go up. And with the hope of chasing the running bull, we end up jumping onto a high fence just to catch the bull. But one thing I have noticed, after the big jump of the market, the deep plunge will follow. So do not be afraid to sell at ATH, and wait patiently for its ATL before you place a buy order.
Learn How The Market Behaves (Technical Analysis) Before Placing An Order/Position
To be a successful crypto trader, both in spot and futures trading, knowing the technical analysis of the market really matters. Relying on our gut and the current trend is not enough to earn a profit. We should also consider the past performances of the market and our ideal coins, how they behave and what actions we should perform in the future.
And before placing a position in futures trading, make sure that you understand and analyze the charts. Do not place a long position just because the price is going up, do not place a short position just because the price is going down. Consider the possible circumstances that may follow. Will it continue to go up? Will it continue to go down? Or will it go against your prediction?
Always remember that the current resistance can be the support later. And the current support can be the resistance later. And in this volatile market, expect the unexpected and the worse.
You can read articles of @Eybyoung @Serg0213 @wrabbiter about technical analysis and trading indicators.
Do Not Set A Buy/Sell Target Price That Are Quite Impossible To Reach
Just like what happened in my spot trading, I placed a buy order of $450 at a current BCH price of $500+. I placed a buy order of $1650 at a current ETH price of $1700+. The difference was actually just $50+ but an unexpected thing happens when you least expect it. So much better to set an order/sell target price that is not so far from the current price, IF you really want your order to be executed immediately. But in case you insist on your target price, a lot of patience is needed because it may take a lot of time before you reach your desired price.
Do Not Place A Position In Futures Trading If The Market Is So Volatile
The market is always volatile, what do I mean by this? If you are a future trader, then you know what I mean. Sometimes, the price of certain crypto is so volatile that it goes up and down in just a blink of an eye. There is one time when the BTC was going up and I placed a long position and I've got a profit right away just after a few seconds. But the next time I placed a new long position, the price abruptly goes down not even giving me the chance to set TP&SL, thus, burning my entire margin.
You can even lose your position in a bull market as well, especially if you only have a small margin. That is why setting a TP&SL is important. So if the certain crypto you want to trade is so volatile, you rather wait for the stability of the market before placing a position, or the best and safest thing to do is to just HODL it.
Do Not Be Too Greedy and Excited
This happens both in spot and futures trading. With the greediness to earn more in futures trading, we tend to place more positions and set a higher TP. And with the excitement of chasing the running bull, we tend to place a buy order at a higher price and get FOMO.
So you rather take the small profits than lose everything. And make sure to set an SL to avoid liquidating your whole margin. And as I have said above, be patient and wait for the perfect time to place a buy/sell order.
If You Can't Chase A Running Bull, Then Chase The Bear
Most traders are into chasing the running bull, but it's not only the right time to get more profit. In case you are too late to chase the running bull, then wait a little bit more because the bear is just behind waiting for its right time to take the race.
How can we earn profit from a bloody market? Well obviously, it is the perfect time to buy more coins. And in crypto HODLing, it is not actually the price that matters, but the amount of crypto you will accumulate in your wallet. The more coins you have, the higher the returns in the future. Just make sure not to choose shitcoins! Some traders are even pulling out their investment from the bear market because they become fearful and pessimistic that their crypto might go to the south. But if you already feel safe and positive about your ideal crypto, then there is nothing to worry because a bear market eventually recovers.
So last Tuesday was the perfect time to buy more BCH. I have said to myself before that I won't gonna touch my bank savings account to invest in cryptocurrencies because it's gambling. But staying in the BCH community for quite a long time made me realized that my money won't grow fast in my bank account. But if I will put it in my crypto wallet, it will grow just a few weeks to a few months later.
The money I have invested is not all in BCH, because as I have said, I want to diversify my crypto portfolio, and putting all eggs in one basket is not the best strategy to do. As small investors, we should think about the higher returns and the unexpected market swings, not just about the current trend. And as of now, I have 13 different coins in my wallet and BCH holds the majority of it. The amounts are not that big but I am taking it slowly but surely. It may be small today, but it will grow in the future.
I also want to apply what @PVMihalache has said, "don't invest in what's trending, invest in what do you think that will boom after a month or the next months." Just like in trading, analyze the charts and think about the circumstances that may follow.
With these lessons and the advice of some experts, I will continue my crypto journey until I reach my crypto goals. I am aiming for 5 BCH this year, but it's only February and I already have 3 BCH in my wallet. So from the 5 BCH goal, I want to pursue 8-10BCH this year. And there's no harm in trying for as long as you have the determination and perseverance, you will be able to achieve your goals this year and for the upcoming years.
Crypto-Related Articles:
My First Live Future Trading On Binance
Spot Trading On Binance
Stop-Loss: Set Low or Set High
Earn More Crypto Without Trading
Take This Consideration Before Investing In Cryptocurrency
Things To Consider in Choosing a Crypto Wallet
Millenials Should Stop Wasting Money and Start HODLing Crypto Instead (Crypto Guide For Beginners)
Why Trading Journal Is Important For A Successful Trading Journey
The Importance Of Diversifying Crypto Portfolio
Cryptocurrencies I Want To Include In My Portfolio
Can't Think of Anything To Write? Explore The Crypto Space
Articles You May Want To Read:
Bitcoin Cash: The Coin Of The People The Real Bitcoin
Nothing Is Impossible If You Have The Determination
5 BCH Goal, Can I Achieve It?
My First Day Of Onboarding Hong Kong's OFW, I've Met A Former Filipina Crypto Trader
I Owe BCH A Lot And The Reasons Why We Are Spreading BCH Awareness
Very nice article po.. a big help po sa mga beginners like me. Kudos! 🥰