Practical tips on how to trade cryptocurrencies

For some time now, I have been watching the performance of cryptocurrencies closely to get a sense of where the market is headed. The routine that my primary school teacher taught me where you wake up, pray, brush your teeth and eat breakfast has changed a bit to wake up, pray and then go to the web (starting with coinmarketcap) just to know what crypto assets are in it. the red

The start of 2018 was not pleasant for altcoins and related assets. Its performance was hampered by bankers’ frequent views that the crypto bubble was about to burst. However, ardent followers of the cryptocurrency are still “HODLing” and the truth is, they are reaping a lot.

Recently, Bitcoin reached almost $5000; Bitcoin Cash reached $500, while Ethereum found peace at $300. Virtually all coins were struck apart from the newcomers who were still in the excitement phase. At the time of writing, Bitcoin is back on track and is trading at $8900. Many other cryptos have doubled since the uptrend began, and the market cap stands at $400 billion from a recent peak of $250 billion.

If you are slowly warming up to cryptocurrencies and want to become a successful trader, the following tips will help you.

Practical tips on how to trade cryptocurrencies

• Start modestly

You’ve heard that cryptocurrency prices are skyrocketing. You’ve probably also gotten the news that this uptrend may not last long. Some detractors, mostly esteemed bankers and economists, tend to call them get-rich-quick schemes without a stable foundation.

This news can make you invest hastily and not apply moderation. A little analysis of market trends and worthy coins to invest in can guarantee you a good return. Whatever you do, don’t invest all your hard-earned money into these assets.

• Understand how exchanges work

Recently, I saw a friend of mine post a Facebook feed about one of his friends who happened to trade on an exchange, he had no idea how it works. This is a dangerous move. Always check the site you want to use before you register, or at least before you start trading. If they provide a mock account to play with, take this opportunity to get a feel for what the board looks like.

• Don’t insist on negotiating everything

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

• Stay sober

Cryptocurrencies are volatile. This is his bane and his profit. As a trader, you must 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 ensure when to execute a trade.

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

• Diversify significantly

Almost everyone will tell you to expand your wallet, but no one will remind you that you have to deal with coins with real uses. There are a few crappy coins you can deal with for a quick buck, but the best cryptocurrencies to deal with are the ones that solve existing problems. Coins with real 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 leverage these digital assets.