Even though it would not be a life or death situation, losing your coins due to trading without any previous knowledge and guidelines can be quite frustrating, to say the least. Is there a way to avoid making costly mistakes and can we make sure to always be on the green side? Profitable trading requires a lot of attention. That is the first thing that you need to be aware of. As well as that it is not a gamble and it should never be treated as such. Pay close attention to the market forces of demand and supply for a start. That way you are going to know when the upcoming tips that we are going to discuss can apply.
This most probably will sound obvious, but to mention it just in case, it is important to have a clear purpose when dealing with cryptocurrency trade. Whatever the motive is, day trading or scalping, it needs to exist. Trading digital currency is a game in which you need to realize that to win something there must be a loss at first. Some come out triumphant while others quite the opposite.
The market is controlled by the large “whales”. They are similar to those that would place thousands of bitcoins in the market. Their patience is great and they wait for some innocent trader to make one mistake. That would land poor victims money to their greedy hands. Those mistakes are avoidable. Regardless of you being a day trader or scalper, it is better sometimes not to gain anything on certain trade than to rush into one that will bring a sure loss.
It would be wise not to run too much ahead. What I mean by that is, experienced traders, do not follow the direction of massive profits. They are rather staying put. On the bitcoinrevolution website, a small but sure profit can be gained. Think about investing less of your portfolio in a market. Preferably the market should be also less liquid. Higher trades require more tolerance, while profile target points and stop-loss will be distributed further from the buying level.
There is one common mistake amongst most beginners. They buy a coin because its price seems to be low or they just consider it to be affordable. Someone who goes for Ripple instead of Ethereum for example, simply because the latter is much cheaper. Affordability should not matter when it comes to investment decisions into a coin. It has a lot to do with its market cap.
Cryptocurrencies, as well as a conventional stock, are gauged by their market caps. The evaluation is done by the formula; the Total Number of Outstanding Shares, times, Current Market Price.
There is a little difference between a coin that is priced ten dollars each with a total number of one million shares in the market, and the same coin priced at a hundred with one hundred thousand shares in the market. For that reason, it is better to use a coin market cap. That way you can make a decision whether you should invest or not. It is fitting for investment if the cap is higher.
This would be a short yet useful tutorial for traders when it comes to navigation on the cryptocurrency market. Before you start trading, we would advise you to think about what we have suggested, and when you decide to dive into that endeavor we wish you all the luck in your efforts.