Crypto trading habits determine if you are going to be a successful trader or a bad one; see five good and bad habits to know about in this article.
Success in crypto trading, like all businesses, is more a product of habit than many people realize. Many of the decisions that you believe to be made on a whim can actually be traced back to habits that you have formed over time.
So, how do you get to form good crypto trading habits before opening the bitcoin app the next time? Well, there are several things you can do regularly and some that you should consider stopping. See them below:
Five good crypto trading habits
- Keep learning: If you want to be successful in the crypto world, you have to be assured that you don’t know as much as you think. This way, you get to keep an open mind and learn as much as possible from your successes in the business (even from your mistakes). Panels, books, and social media posts can prove informative and you never know what you might learn. So, a good way to start is stay in touch with leading figures and authoritative sources.
- Patience: Trading is a business that accumulates over time and if you are looking at it as a quick dash-and-grab, you may have to change your perspective. Impatience can lead to mistakes that you would regret.
- Check charts: Charts tell traders which way the market has moved and seasoned analysts can predict in which direction it would move. This is the reason why each trading decision should be preceded by a study of the charts. If you used to make decisions on a whim, you are inviting problems.
- Keep a trading journal: Journals help you keep track of your activities and a trading journal helps you document things. Of course, you may not remember everything and would likely miss some decisions, yet, it is vital that you don’t stop. Trading journals would come in handy in the future if you are looking at publishing a book. And even if not, it could serve as a good read for mentees in the future.
- Collaboration: Traders keep all sorts of hours and often become loners trapped in their own world of charts and decisions. One way to alleviate the lonesome feeling is to join a community of traders and collaborate often with other traders. You should also attend events, even if it is to just sit and listen. However, once in a while, it is good to share your ideas; you never know who you are giving a helping and with your trade stories.
5 bad crypto trading habits
- Taking large risks: Of course, the very decision to enter crypto trading is a risk on its own. But, you are advised to take measured risks and large risks are just a sure way to lose lots of your money at once. Of course, some trading ‘gurus’ will advice you to take big risks because it promises bigger rewards. The key thing you should remember is that crypto trading is supposed to be a passive source of income, so, you should not expect to use the proceeds to totally transform your life.
- Poor responsibility: Take responsibility for your trading and remember to take a break once in a while. Whether you are are on a earning streak or a losing one, it is not wise to continue pursuing trades for a long period, especially short trades. Responsibility is another one of the vital crypto trading habits that traders often ignore. One other way to ensure you are doing it right is to monitor how many times a day you impulsively open and close your bitcoin app.
- Over leveraging: When it seems like the outcome of a stake is assured, traders may over leverage (or stake more). The truth is that, the market projections are always informed guesses and no matter the track record of the system used to get such predictions, there is still a slight chance that it may not turn out that way. Piling more money than you can afford on a trade is one of the many bad crypto trading habits. Even if doing this has favored you in the past, it would be wise to consider yourself lucky and put an end to that habit if you want to succeed in the industry.
- Poor risk management: Risk management involves putting measures in place to ensure that you don’t lose too much if the market is moving poorly. There are several trading apps that requests that traders choose stop loss points. Make it a point to always have one in place, especially when using trading robots.
- Greed: It is impossible to remove the human element from crypto trading and greed plays a huge part in losses. Being a greedy trader means you want to take large risks and ignore stop-loss orders.
Crypto trading habits eventually pay off in the long run if you master them, and you can only do that by making them part of your activities each time you are about to begin a session.
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