What to do when I lose money in Crypto?
Filipino Traders may be aware of the widely publicized statistic: "95% of traders lose money." Even if there has been an immense growth on the margin accounts of cryptocurrency in different crypto exchange platforms including Binance, there are new users that attempt to trade in the crypto markets so they can earn more profits in Bitcoin.
However, it is unfortunate that many new traders eventually lose money on platforms of crypto margin. If you are looking for strategies and tips in crypto trading, we will provide you with the best advice to improve crypto trading.
Tips in Crypto Trading that You Need to Act On Right Now
Here are the best tips in crypto trading that will allow you to become a highly profitable trader:
Practice how to trade with the use of a demo account
Any crypto investor may become tempted to have their investment multiplied through the use of well-known platforms in trading cryptocurrency. For first-timers, it can be highly ideal to use these exchanges as these can allow people to speculate on the digital assets' price so they can attempt to purchase at a low price and sell at a high value. People need to become cautious about this, especially if they don't have a game plan or sufficient market knowledge.
Before you deposit any funds, it would be best to become aware of how you can trade crypto using a demo account. Doing this is vital, especially if your trading experience is insufficient. Plus500 and eToro are among the best demo accounts in crypto as they offer a CFD platform that is user-friendly for anyone who wants to know how to develop a strategy in crypto and trade. You can also have a demo account created with eToro as it is free for people to use over and over. It can also back-test your crypto strategy without having to lose money.
Generally, whenever you don't earn any profit in a practice account in trading, you can be highly likely to lose money whenever you trade on a real account. Through this, you can have your investment intact in your crypto hardware wallet, and you learn more about trading in crypto.
Minimize Position Leverage and Size
Often, the mistake people make in trading is the use of incorrect position sizing. It can get compounded whenever the traders use high leverage on any margin trading exchange. Traders with experience can capitalize on small swings in the market price by using an exchange (like FTX) and its high leverage. Yet, since the crypto market is quite volatile, having a higher amount of leverage can allow you to get to a position closer to the price of liquidation.
In case you are just beginning, minimize the leverage amount, always make sure to have a stop loss used, and risk only a 1% maximum of your capital. Doing this can allow you to lose a hundred trades in a row to have an account blown with a relatively low probability. Some crypto exchanges have a tool for calculating the position to assist in sizing a trade that has a basis on your startup capital.
Keep Things Simple
Many new traders get the 'trader's brain' whenever they do too much micro-managing of trades, trades, thinking, checking the charts, and so much more.
Whenever this happens, it is clear that you are operating without any trading plan. In case you see that you're making these mistakes, you can benefit whenever you take a lesson from any successful trader and investor who had spent most of their time on the sidelines as they analyze the markets and wait for opportunities.
Just a tiny part of their time gets spent on risk management and trade execution. Because of that, you need to do less to increase your profitability. The web and the spider is the classic analogy. It would be far better to become aware of your game plan and then wait when the perfect trade comes to you.
Included here is when your position becomes active. Allow the trade to play out following your trading plan. Make sure to have losses cut ahead of time and allow your winner to run.
Maintain A Journal Of Every Trade And Work on Improvements
Were you able to encounter the phrase, "Bulls Make Money, Bears Make Money, Pigs Get Slaughtered?" It is a warning to traders who think like pigs that desire impatience and greed in the markets. Whenever they do this, they could end up getting slaughtered. Traders that are greedy allow their emotions to take control that happens because of the following:
The mentality of ‘Must Be in a Trade to Profit.'
Have A Strong Belief in the Market Trend
In case this is what describes you, it means that you trade like a pig that you could eventually lose your balance. Having a strong discipline in the mental aspect is essential for trading in any traditional market or crypto. New traders can focus so much on making their day trading strategy in crypto perfect. However, attaining perfection may be too far from reality.
According to Warren Buffet, a well-known investor, temperament is a critical determinant in an investor's success. Skill and intelligence are not essential determinants. Whenever you don't have strict discipline and temperament, you could trade like being inside a casino with your crypto. It can be a harsh reality. You would not become a successful crypto trader whenever you trade as if you're a pig.
Unfortunately, not all people have the proper discipline and temperament to become highly profitable in trading crypto. Whenever you feel like struggling to earn a profit after some time, you may need to accept that trading may not be ideal for you. People can gain many other ways from cryptocurrency aside from trading that you would have to consider earning interest from apps on Bitcoin cashback and crypto apps.
Avoid Forcing Trades and Be Patient
Rushing into a trade position through the use of the market order may be among the biggest mistakes you can make when trading. Aside from paying a premium in trading fees so you can have a market order executed, it may often be the worst point of entry as the price can instantly reverse against you, leading to another loss. Whenever you possess the urge to get into a trade when the price moves quite fast, you may be suffering from FOMO.
For crypto traders, it is vital to remember that the market is open 24 hours a day, seven days a week. Whenever you miss a trade setup, you need to become patient and wait for another opportunity. It may become frustrating for any swing trader on the weekly and daily time frames. However, there will always be another opportunity, and you should at least allow your capital to become preserved.
When it comes to trading crypto, it is an excellent skill wherein so much patient and skill would be required. Even if trading crypto may not be for everyone, we hope that these trading tips in crypto for beginners will become helpful in dramatically improving your profit and loss in the long run. Whenever you have any comments or questions, or you want to share any common mistake in trading, please share your thoughts in the comments!
It can now be possible for Filipino Binance users to sell and buy ETH, BTC, BNB, USDT, EOS, and BUSD using the Philippine Peso. Binance has a P2P platform that allows Filipinos to do this without any transaction fees. Integrating this will enable the user to trade crypto in their preferred prices and payment modes. They can even have their crypto assets transferred to a Binance wallet without an added cost.
The platform's zero transaction fees offer an escrow service that ensures that all of the cryptos will go to the users' wallets. Binance has a P2P platform that lets users gain more access to various financial services. Included here are spot, margin, lending, and futures trading of Binance.com.
Since its launch in October 2019, Binance's P2P platform has supported approximately 31 fiat currencies. It was also able to process trades of more than $1 billion. For their Global P2P Merchants Program, the company now actively searches for local merchants with reliable crypto and fiat access. Here, verified merchants enjoy a lot of benefits. It includes exclusive support for customers, VIP discounts, ad transactions and postings, and security deposits without any fees.
Learn more about Binance P2P trading by trading through Binance now.