Let’s Start With A Friendly Warning That Comes Straight From My Heart
If you are considering undertaking any kind of trading activity, Crypto or otherwise, as a means to earn enough money to cover your bills – please don’t. Get a second or third job, try to save a but on the side, and if your partner (if you have one) is also onboard with you giving this a try, be smart and go in with both eyes open.
How to Start Trading Bitcoin
Where to buy bitcoin. The first thing you need to get started trading bitcoin is to open a bitcoin wallet. If you do not have a bitcoin wallet then you can open one at the biggest wallet called coinbase. We have arranged a special deal for everyone wanting to get started in bitcoin to get a free $10 at coinbase. Get your free $10 by opening your coinbase account here..
Bitcoin traders are actively seeking the best possible solutions for trading and investing in bitcoin. We have learned this bitcoin wisdom by trial and error and we are going to show you what is working right now. Also please note that it is possible to lose money and your capital is at risk while trading cryptocurrency because it is still trading and speculative in nature. That is why we always recommend that you demo trade before risking any live money.
Please note that none of this is investment advice. Invest at your own risk!
Nine Rules of Crypto Trading
- Only invest what you can lose. Logical right? What kind of crazy person would “bet the house”, even when it’s a sure thing? You’d be surprised. If you think you know yourself, think again.
- Always pay attention to Bitcoin. Most altcoins (every cryptocurrency except Bitcoin) are pegged as closely to Bitcoin as are Siamese Twins are to each other. This is importan if you are using Bitcoins to buy altcoins.
- Never put all your eggs in one basket. Diversify. It’s the same in any asset class. Whether you’re investing in Real Estate, Stocks, Bonds, Currencies, Metals etc., conventional Investment Theory as taught in Universities and Colleages around the globe says that there is an efficient frontier of investments that creates the best “balanced portfolio”. Taking it one step further, it’s important to diversify within an asset class, as well as across asset classes.
- Don’t be greedy. No one ever lost money taking a profit. There’s an old saying that I was once taught by a Floor Trader on the NYSE. In times of market turmoil, he would remain focused and as cool as a cumcumber. One of his favourite sayings and he had many, was “Bulls and Bears live to fight another day. Only PIGS get slaughtered”.
- Don’t invest blindly. There are people in this world who would sell a blind person a pair of glasses if they could make money. We can all accept market risk. It goes with the territory. Some investments or trades we make will be winners. Some will be losers. Fact! However, what we can’t afford to have happened is that we lose our hard-earned capital at the hands of a scammer, someone whose only intent is to steal your money. Sadly there are those that set out to steal your money illegally, but equally and more often, legitimate businesses steal your money legally but getting you to sign legal forms etc., and then charging you fees or selling you services that you don’t need.
- Don’t fall prey to FOMO (fear of missing out). This is a spot that people most frequently lose money on.
- Categorize your investments and look at the long picture. In the process of your research, you’ll eventually realize you’re coming across a few different categories of coins.
- Always learn from your mistakes. Never accept a total loss. Always evaluate the situation and try to figure out why it happened.
- If you are doing any active trading, set stop losses. For any coins not in your medium or long-term holds, always set stop losses.
Each exchange offers different commission rates and fee structures. As a day trader making a high volume of trades, just a marginal difference in rates can seriously cut into profits. There are three main fees to compare:
Exchange fees – This is how much you’ll be charged to use their cryptocurrency software. What currency and coins you’re trading can influence the rate.
Trade fees – This is how much you’ll be charged to trade between currencies on their exchange. A marker fee is a cost of making an offer to sell. A taker fee is a cost of taking an offer from somebody.
Deposit & Withdrawal fees – This is how much you’ll be charged when you want to deposit and withdraw money from the exchange. You’ll often find it’s cheaper to deposit your funds. Also, keep in mind some exchanges don’t allow credit cards. Using debit/credit will usually come with a 3.99% charge, a bank account will usually incur a 1.5% charge.
Cryptocurrency trading strategy
Where can I open a bitcoin account? Just like other assets classes (stocks, bonds, currencies, metals etc.), online crypto trading programs enable you to go long or short to take advantage of price movements in either direction, opening up a world of possibilities. And a trading strategy is a great way of making the most of those possibilities – helping you identify worthwhile opportunities, and enter and exit trades at the right moment. What is the best bitcoin trading platform?
Here’s an introduction to some popular cryptocurrency trading strategies courtesy of one of the most well knows Brokers in the market today, IG Group Limited from the UK:
A Final Word On Brokers
This isn’t a decision to take lightly. Do the maths, read reviews and trial the exchange and software first. Coinbase is widely regarded as one of the most trusted exchanges, but trading cryptocurrency on Bittrex is also a sensible choice. CEX.IO, Coinmama, Kraken and Bitstamp are other popular options.
Try to remain disciplined when trading cryptocurrencies, by only placing trades that are in line with your trading plan. This will help avoid common pitfalls that arise when emotion affects your decision making – such as chasing losses or getting overconfident from a winning trade.
What’s important is that you focus on the quality of your trades, rather than the quantity.
To your success!