Is it possible to make good money with crypto? Well, Trading crypto has shown to offer astronomically higher returns – even more than the traditional trading scene. So, it could be claimed that you can definitely add to your wealth with investing in Trading crypto. But, also, crypto is an extremely volatile industry; while people have made millions here, some people have also encountered terrible losses. Thus, when you are aiming to make good cash in the crypto scene, you should be careful about the mistakes to avoid as well. Check out more multibankfx buy bitcoin
Top tips to remember to earn some good bucks with Trading crypto
Know when to stop
It’s easy to enter a trade but often extremely difficult to exit. But, a wise trader knows that the timing to exit could make or break your fortune with trading, including Trading crypto.
The understanding of exit points is crucial both when you are losing and winning. If your goal is to make good money with Trading crypto then you have to ensure that you are able to “keep” the money – not lose it out in large volume. In the end, what matters the most is how much you are being able to take back home with you,
So, there are two crucial bars that will help you to time the exit point right and preserve your money.
Stop Loss
In Trading crypto, Stop Loss is the level that will specify the maximum level up to which you would be able to bear the loss. Once you reach that level, you will exit the trade immediately. Every trader would have to encounter losses at some point in their trading journey. But, one has to make sure that the loss would be bearable and won’t make a significant impact on their finances. By default, the ideal Stop Loss level should be your buying price- the price at which you had purchased the crypto in the first place.
Profit Target
You cannot get into Trading crypto without a specific profit trade. Study the market and find out the standard profit you might expect with your preferred crypto. Set your profit target around that standard amount. You will stop Trading crypto for a while immediately after your trade reaches that predetermined target. Crypto market is wild and might not take much time to take a dip even if it is on a high right now. So, overtrading, even if you are winning, could lead you to serious red in the trading chart.
Focus on smaller profits
If you are just starting out with Trading crypto, don’t immediately focus on making large profits at once. Rather, concentrate on little yet sure profits. This way, you will only have to invest a small amount of capital while you can utilize the rest of the capital later or else on other less volatile trading markets.
Day trading would be a good trading strategy here that will allow you to trade with small capital and make decent profit with little shifts in the market. You can try out scalping as well. It’s a type of day Trading crypto where you can place multiple trades within intervals of a few seconds or minutes in one single trading day.
Leverage trading
Traders who are determined to earn big profits, should opt for leverage Trading crypto. Leverage trading enables traders to trade with bigger trading positions and earn huge profits with borrowed funds. In this case, your personal investment would be less and the rest of the money would be lent by Trading crypto platforms. But, remember, while leverage Trading crypto makes way for huge profits with less personal share of capital, it can also result in mammoth losses if the market doesn’t swing in your favor. Thus, leverage trading is especially meant for veteran traders who are well aware of the tactics to avoid losses and come back with grand profits.
Diversify
Bitcoin attracted a sea of investors in the period between end of 2017 and early quarter of 2018, just after its first ATH. But as the coin reached the middle of 2018, it started losing out in value- so much so that it sent panic across the whole crypto world. But Bitcoin has recovered again and reached its second ATH in 2021.
Bottom line is, crypto coins can drop down to massive lows from awe-inspiring highs in little time. Thus, if you are aiming to make god money in an illiquid and wild market like crypto, make sure to maintain a diversified portfolio. This way, you will always have other crypto options to make money from even if the primary coin is down for a while.
The DCA strategy
The DCA strategy is all about diversifying your funds while investing and Trading crypto.
DCA prevents you from allotting the entire trading capital in your chosen crypto all at once. Rather, it encourages you to allot a specific sum of money for investing and Trading crypto every money. This way, you will be able to chalk out a systematic routine of investing and Trading crypto that will help to ensure a more manageable risk appetite and good returns over time.
Specific timing for specific cryptos
When you are aiming to make good money with Trading crypto, you should also understand that you cannot expect good money if you sell off all your different cryptos all at once. Not all coins command the same future- while Bitcoin assures a sustainable future, most of the meme coins won’t matter after a couple of years. So, if you are holding coins that might not sustain in the long run, you should sell them off fast. But, if you have legacy coins, go for HODL for colossal returns after a few years.
Final words
We will end the post with a list of mistakes to be aware of when you are looking forward to making good cash with Trading crypto.
- Do not end up buying a crypto when it’s high out of FOMO
- Refrain from impulsive buying and overtrading
- Do not skip out on fundamental analysis, especially when choosing a crypto for Trading crypto
