Practical tips on how to trade cryptocurrencies

For some time now, I have been closely observing the performance of cryptocurrencies to get a sense of where the market is headed. The routine that my elementary school teacher taught me – where you wake up, pray, brush your teeth and have your breakfast changed a little to wake up, pray and then hit the web (starting with coinmarketcap) just to know in which crypto assets are in. the red

The beginning of 2018 was not good for altcoins and related assets. Its performance was hampered by frequent bankers’ opinions that the crypto bubble was about to burst. However, ardent followers of cryptocurrency are still “HODLing” and truth be told, they are reaping big.

Recently, Bitcoin retraced to almost $5000; Bitcoin Cash is close to $500 while Ethereum has found peace at $300. Practically every coin has been hit by newcomers who were still in a phase of excitement. As of this writing, Bitcoin is back on track and trading at $8900. Many other cryptocurrencies have doubled since the upward trend began and the market capitalization is resting at $400 billion from the recent peak of $250 billion .

If you are new to cryptocurrencies and want to become a successful trader, the tips below will help you.

Practical tips on how to trade cryptocurrencies

• Start modestly

You’ve already heard that cryptocurrency prices are skyrocketing. You have also probably received the news that this upward trend may not last long. Some opponents, especially bankers and esteemed economists are generally forward to call it as get-rich-quick schemes without stable foundation.

Such news can make you invest hastily and fail to apply moderation. A little analysis of market trends and worthy currencies to invest in can guarantee good returns. Whatever you do, don’t invest all of your hard earned money in these assets.

• Understand how exchanges work

Recently, I saw a friend of mine post a Facebook feed about one of his friends going to trade on an exchange that he had zero idea about how it works. This is a dangerous move. Always check the site you intend to use before you sign up, or at least before you start trading. If they provide a dummy account to play with, then take the opportunity to learn how the dashboard looks.

• Do not insist on trading everything

There are more than 1400 cryptocurrencies for trading, but it is impossible to deal with them all. Spreading your portfolio to an enormous number of cryptos than you can effectively manage will minimize your profits. Just select a few of them, read more about them, and how to get their trading signals.

• Stay sober

Cryptocurrencies are volatile. This is both its harm and its benefit. As a trader, you have to understand that wild price swings are inevitable. Uncertainty about when to make a move makes one an ineffective trader. Leverage hard data and other research methods to be safe when executing a trade.

Successful traders belong to various online forums where cryptocurrency discussions regarding market trends and signals are discussed. Of course, your knowledge may be enough, but you need to rely on other traders for more relevant data.

• Diversify significantly

Virtually everyone will tell you to expand your portfolio, but no one will remind you to deal with currencies with real-world uses. There are a few crappy coins you can deal with for quick cash, but the best cryptos to deal with are the ones that solve existing problems. Coins with real-world uses tend to be less volatile.

Don’t diversify too early or too late. And before you make a move to buy any crypto-asset, make sure you know its market capitalization, price changes and daily trading volumes. Maintaining a healthy portfolio is the way to reap big from these digital assets.