Crypto

5 Things to Keep in Mind While Trading CryptoCurrencies

Fiat currencies are more stable than crypto, have you got what it takes?

Is this a pump and dump move or are you really in the cryptocurrency news groove?

Are market trends applicable? Have you got the staying power and the knowledge to ensure you retain stable results?

Mention crypto currencies to the average man, woman or genderless person on the street and they may be able to rustle up one or two names of current digital currencies. Bitcoin being the most infamous, but as to their use, not many people will know how to buy into crypto let alone make one. How can you fair better?

1. Investment or betting – exchanging from hard to digital.

Gambling, the easiest way to lose money and make money tax free in some countries, while mathematical equations and investing in companies on stock markets has long been the play toy of the rich and famous.

Both of these have one thing in common, a Fiat currency. All recognized legal tenders that have been underwritten by the state, you could be asleep for a week and a Dollar or Pound will most like be the same exchange rate when you wake up.

According to Basil, a crypto expert from Coindonut, “There is no certainty that a Bitcoin, Litecoin, Ripple or Ethereum will hold nearly the same value in the same hour let alone the same day. Which is way intraday trading is so popular across all new cryptocurrencies on the exchanges. Consider your investment a loss until otherwise informed.”

2. The market leader leads but also runs and runs.

The global currency for Fiat is without a doubt the American dollar. On open markets for commodities people wish to sell and buy and float in a currency they know and understand to be stable. So stable in fact that other countries peg their own currency to it. Crypto has one big bother too, Bitcoin, where it goes others follow. They may be different platforms but they tend to ride the waves of market emotions.

3. Understand what motivates a cryptocurrency.

There’s nowhere to hide, head for the hills. Stand in a pub and you’ll notice certain people play the slot machines more than others. Their frequency to and from that establishment denotes how much money goes in and out of that machine. Throw in payday and events such as football on the television and soon you’ll know when to intervene and maximize for best pay out.

Go with the flow or understand from where the flow stems? It is important to understand what effects there are on an investment to make it fall or rise at any particular time. Is the government intervening, are bankers happy? Is there a good news story, bad news story or is another investment more attractive? Is China saying goodbye to crypto? Or is it perhaps just raining?

4. Fees, exchanges, dips, highs and eventual lows.

Stability is what you find in the Gold market, the go to place to store up cash for the long haul to ride out a bumpy time when all other markets are folding. You don’t care if you lose 10% in ten years, your money overall is safe as it’s defended by the American Airforce, Navy, Army, National Guard and Secret Service.

A Crypto currency is at the other end of the scale, just recently we witnessed Bitcoin hit $20,000 only to unravel and succumb to $11,000 within a period of days. A rollercoaster like this has not been invented for a theme park as of yet.

You place your bets or investment and it tends to be a whole number. Then comes the fee, for selling, buying, placing, trading, moving. Do you know how much each of these transactions cost, are they flat fees or percentages of total amount of based on profit on the day? Do you trust the exchange you have decided to store your cryptocurrency wallet and offers? Will they go bust, are they dodgy?

Do you understand the patterns and trends that have gone before and what may possibly occur in the future? All data points are interlinked somehow but how? You probably don’t wish to buy a Bitcoin at the end of a rise unless you know it will go up further still and is instead the dip. You may also prefer to be in on a new currency that will multiply its worth 1200% while Bitcoin being one of the first modern crypto currencies had those rallies years ago.

5. Targets, fractions, results and staying power.

If you’ve been to the races you’ll know that the money you arrive with has to not only bet on number three all day long but pay for food and drinks in between. You know the limit of your enjoyment is contained within your wallet. This is your staying power, your ability to manage your funds so you can see out the end of the day and get home after too.

Digital assets which you can neither touch or hold can evaporate instantly. You do not need to buy an entire whole piece of a digital currency. You can buy a fraction of a coin and this is recommended at the outset. You’ll need to understand that part you have but also know the fees for each time you hold or sell your position.

A person can quite easily enter intraday trading – one day trading – and not be able to divest and invest the next unless they make careful targets to attain, monitor results and ensure their staying power for the next day’s events.

Whether you consider cryptocurrency to be gambling or an investment. For fun or for serious monetary gain. Pick up a book and read about what blockchain actually is. How it is underwritten, where the money actually comes from and how it rises and on the day’s news and general investor sentiment.

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