Top 6 Cryptocurrency Trading tips!

skrimon · August 17, 2022

1. Be Aware

Your first step when jumping into the Cryptocurrency market is to ensure you understand what it is, how it works and what the potential benefits and disadvantages are. Like any market, researching the history of Bitcoin and other altcoins will give you an in-depth look at the current state of the market and provide insight on whether now is the time to buy, sell or hold. As the Cryptocurrency market is so volatile, researching is essential. Most professional brokers and investors aren’t even able to predict where the market is heading as it changes so quickly!

2. Understand the Exchanges
Cryptocurrency trading is new compared to trading stocks on the ASX or NYSE, so important to understand how each program and trading website works. We recommend some time to make a mock account on Changelly (or any of the other Crypto trading sites) to practice and learn how the software works before you commit to actually placing a trade. Another note to make on the altcoin exchange process is that, unlike traditional currencies, Cryptocurrency trading can take hours to settle – so don’t panic if your trade or purchase isn’t completed right away.

3. Understand Value
The Cryptocurrency market has been in the firing line of the world’s top investment firms for being so volatile, or even for being a ‘’bubble’’. Understanding how the price of altcoins is affected can be rather confusing, but simply speaking: the price of each coin is generally affected by the others. As Bitcoin grows in value for instance, the major altcoins (Ripple, Litecoin, Ethereum) have generally followed the same trend.

4. Minimise Diversity
Generally, when trading, diversity is good, though when dealing with the rules are different. Altcoins normally rise and fall in synch with each other, though, some more than others. When dealing with Cryptos, the safer and more choice is to heavily research and determine the best currency for you and invest (as much as you’re prepared to lose) into that one currency.

5. Don’t Cash Out Right Away
If your reason for investing was for a profit and you plan on watching the market and seeing how far your investment can take you, then don’t instantly cash out as soon as there is a major jump in price. With such high volatility levels it’s easy to be caught up in a quick profit when the price jumps, though, there may be far more potential in the long term and it is recommended that you leave your and wait for a second or third jump, which are, historically speaking, far larger than the initial jumps.

6. Is a High a real High?
A complex process in the cryptocurrency investment business is determining when a high is actually high, and when lows are low. As Cryptocurrencies are fairly new, and new ones are being released on a monthly basis, the market is still yet to show any signs of consistency. When planning to sell, clearly check all markets for signs of an incoming spike, or drop – or an impending high growth period. Altcoins are heavily controlled by public perception, professional opinion and press releases, so stay aware. Leading investors also recommend only selling 20% of your stock on a high, as another high could be just around the corner.
Thanks for Reading!