Are You Trading Or Buying and Accumulating Crypto For the Long Term?
When you buy cryptocurrency, what is your intention? You want to make a profit, that's good, but how are you going to do that? Will you do crypto trading? Or, will you buy and accumulate crypto for the long term?
It looks like the same thing, but it is not. Your mindset and the way you act while trading and investing are different. You might get confused and fail to take action if you don't have a specific plan.
A lot of things are going on at the psychological level. People get into FOMO and FUD and do different things in crypto. If you end up losing money in crypto, this is not good. Crypto is not a gamble. You don't come into crypto with a gambling mindset, I guess.
Whether you make money from crypto or lose money in crypto matters in your financial situation. If you want to do trading in crypto, you take advantage of the price fluctuation and make a profit. You can do day trading, swing trading, and position trading.
When you make an investment in crypto, you usually think about the long term. You pay attention to the fundamentals and see the long-term potential. Will it survive in a bear market where you invest in crypto? That's a big question.
Most cryptocurrencies may not survive or even they survive might not do well in the next bull run. Investing in high-conviction crypto is very important. You can do technical analysis to take entry and accumulate crypto for the long term.
On the other hand, when you do crypto trading, you follow your system strictly. You take a profit when it hits the profit target and you take losses when it hits the stop loss. You may not feel good taking a stop loss, but I think being comfortable with taking stop loss is a good thing. It indicates you follow your system and act accordingly.
Probably you think you can do better without taking stop loss, you will sell when the price goes up again. You make some profit and feel good. When you end up losing your trading capital in crypto, you realize how good it is to take a stop loss. There is something you have to learn the hard way.
You can do both trading and investing. Just define what you are doing and stick to your plan. It does not feel good holding the bag in crypto. If you make a plan before taking an entry and execute your plan of action, you may not end up holding the bag in the first place.
So what do you think? Please feel free to leave your comments. Thank you for reading this post. That's it for now. I'll be back with another post.
