Technology

6 Common Crypto Trading Mistakes to Avoid

Cryptocurrency trading has been picking up in the recent past. There are ads all over and people who have testimonials on how the entire thing has worked for them. As such, new traders have gotten interested and started trading. The one thing with cryptocurrency trading is, there is no adequate training on how the entire thing works. The following tips will come in handy for anyone trading cryptocurrency.

Trading Before Training

The one thing that makes so many people lose out on money is trading before they get training. Just because you have traded in stocks before does not mean you will immediately figure out cryptocurrency. Taking the time to get training will help you know how the system works and what you need to look out for. Skipping this step means you are starting while blind, and it might have dire consequences.

Paying a High Exchange Fee

The one thing that people do not pay attention to is the trading or exchange fees. While you might be making profits, they will mean nothing if you have to pay a huge percentage of this money to trade. Find out the rate you will be charged for you to go one trading and see if the charges make financial sense.

There are a number of cryptocurrency exchanges like OKEx, Binance and Kraken to choose from. Closely review each exchanges capabilities and fees to find the right one for your needs. 

Not Doing a Thorough Analysis

Another mistake many people make is not doing adequate research on the cons they choose to trade. When starting, many people trade in the coins they are familiar with and are doing well. If the trader does not do adequate research, they will make losses in the long run when the coin’s value drops soon. In doing enough analysis, one can see whether the coins they are planning to trade in will be there for a while.

Not Tracking Trading

A new trader should journal their trading. It helps them know what they need to look out for and what they should avoid. Having a record of the trades they have been doing will help them see what mistakes they made in the past and what they can improve on. It enables them also to develop a strategy that will work for them in the long run.

Lack of a Trading Plan

Without a clear plan on how one plans to trade, there are bound to be issues. A good trader needs to put adequate plans in place like how long they plan on trading and the amount of money they are willing to spend in trading. In doing so, they can limit their spending and go back to the drawing body as many times as needed.

Trading Too Many Pairs

Many traders are tempted by the profits other traders are making and trade in way too many pairs. Doing this will may lead to confusion, especially at the beginning. If you are new to trading, it is recommended you stick with one pair for at least 100 trades and see how that goes. You can trade in more pairs later on.

There is a lot that needs to be learned when trading in cryptocurrency. The one obvious yet overlooked point is, you should be patient and be willing to learn. Do not be in a rush to make quick money.

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