There is no doubt that a lot of people are taking interest in knowing more about the crypto industry’s wonders. However, with its complicated nature, there are also a lot of skeptics about how it works.
Unlike traditional currency, cryptocurrency is decentralized. It means that any central authority or government has no control over any of your transactions. Cryptocurrency is also digital cash that can be used to exchange goods and services online.
Among the reasons behind its popularity is that it guarantees cheap transactions and the opportunity to trade and invest. The crypto market is actually regarded as a trader’s playground because of how volatile the coins are.
When trading, you need to have a basic cryptocurrency knowledge base first. This way, it will be a lot easier for you to enter and participate in the crypto market. You also need to be aware of the factors that affect the prices of the coins. Some of these are:
- Market capitalization- it is basically the value of the coin in the market
- Supply- it is the total number of coins
- Integration- the technology and new features of the coin
Crypto trading is one of the best ways to earn profit. As a matter of fact, most investors prefer trading coins because it is a much more reliable asset and is considered private property. You also do not need any banking institution to keep your coins.
If you are a first-time trader, here are some of the things you need to know:
What you'll learn 👉
⚡️ Be Prepared
Even if you invest in the largest or most popular coin, be prepared for sudden changes in the market. With crypto’s volatility, there is no doubt the coin’s value can change overnight. It is best to be familiar with the coin’s trends and look for the best strategy for trading.
Note: Do not be afraid to lose some because it is how investing and trading work.
⚡️ Be Vigilant
Cryptocurrency guarantees fast and secure transactions but you still need to be vigilant. This is because hackers and malware are just around the corner waiting for you to fall into their trap. It is highly recommended that you are the only person who has access to your crypto wallet.
⚡️ Try Other Coins
Investing in one coin alone imposes great risks. As they say, do not place all of your eggs in one basket. This way, you can avoid losing it all. Explore other coins in the market but make sure to know how they work, their value, and their functions in the market.
⚡️ Find Reputable Sources
Aside from learning about the basics of crypto, you need to find reputable sources to keep you updated with the latest movement and its current value. If you want to become a successful trader, avoid listening to those who are non-crypto believers.
⚡️ Choose Your Strategy
Since crypto assets are a high-risk investment, trading without a plan might lead to loss of invested capital. Although there is no perfect trading strategy, it is best to figure out a trading strategy that suits you. Some of the basic trading strategies are:
- Dollar-Cost Averaging (DCA) – it is the most popular trading strategy where you divide your investment into small amounts
- Golden Cross/Death Cross – it is where you need two moving averages that show the mean average price of your asset
- Relative Strength Index (RSI) Divergence – it is a technical strategy used to trim trends when the price starts to move in the opposite direction
With a solid cryptocurrency knowledge base, it will be easier to trade and invest even for people who are new to the crypto industry. It might be challenging at first but you will definitely get the hang of it.
