How To Make Money From Trading Cryptocurrency? – 3 Tips For Newbie Traders
Cryptocurrency has gotten the interest of most people, especially those who keep their eyes on new investments. The market cap of cryptocurrency, although incredibly volatile, has been its best for the past years. Still, several new cryptocurrencies are popping here and there. With this, a greater number of investors are hustling to buy in and invest. In contrast, others would prefer trading one coin to another, based on their speculations and trends.
One way or another, we are here to make a better living. So, without further ado, let’s jump right into how to make money from trading cryptocurrency with 3 tips for newbie traders. We also added some ways on how to earn crypto coins while trading. Let’s go!
3 Tips for Newbies for trading crypto
1. Don’t Just Get in Because of Pressure!
Do not just get in because you fear missing out. This is one of the several reasons why many traders fail in cryptocurrency. From an external perspective, it is not fair seeing people make huge profits within a few minutes from pumped-up coins.
Beware of that moment when the signs seem to be screaming at you, saying you should jump in. At this precise moment, the giants and schemes are watching and smiling while you buy the coins at low prices.
What typically follows is that these coins end up in the hands of new and small traders. And what happens next is that red candles start popping up due to oversupply, and losses start trickling in.
2. Enter Each Trade With Intention
Although obvious, you need to have a purpose for getting into trading cryptocurrency. Whether your intention is to day trade or scalp, you must have a sense for starting to trade.
Trading of digital currencies is a zero-sum game – it always and must even out. You must realize that winning and losing come in sets. Someone wins because someone else loses.
The cryptocurrency market is well-ordered by the large ‘whales’, just like those who place thousands of Bitcoins in market order books.
And these whales have patience. They wait for beginner traders like you and me to make a single mistake that puts our investment to their banks due to needless mistakes.
So, whether you are a scalper or day trader, sometimes you are at an advantage not gaining anything on a trade than rushing into losses. From our experience, we can suggest you that you could only stay gainful on certain days or periods by keeping off some trades.
3. Be Smart With Your Risks
Risk is tangible - you can literally divide or multiply them with your investments. This is true of market profits when you start trading cryptocurrencies. Remember that wise trader never go in the direction of massive profits.
They would rather wait, be patient while gathering small but safe profits from regular trades. Think carefully about investing less of your portfolio in a market that is less liquid. These high trades come with more tolerance, while the profit target points and stop loss will be allocated further from the buying level.
Techniques on How to Get Crypto Coins
You can’t trade if you don’t have any crypto coins. So, in this part, we added some techniques that you can explore so you can make crypto while trading crypto.
1. Be a Crypto Miner
Everybody in the cryptocurrency realm is thankful for miners. Because of miners, cryptocurrencies, such as Bitcoin, have been running and having ongoing success. Not only they get rewarded with Bitcoin, but they also keep our coins sustaining. However, mining crypto is a passive form of income. After the hi-tech equipment’s initial setup, it is now a slow accumulation of cryptocurrencies.
Essentially, mining refers to verifying crypto transactions onto a blockchain and solving algorithmic hash problems to unlock new blocks. Both of these processes produce digital money for a miner.
2. Start Trading Different Cryptocurrencies
One of the reasons that cryptocurrency trading is so good is that Bitcoin, the most prominent cryptocurrency, is very volatile. With this, the price moves up and down within a single day.
Thus, good traders always have their eyes patterns and predict coin’s trajectory to go up. With this know-how, they can buy before and sell the coin when the price will fall.
This technique now leads to huge profits. It is clear that with the correct trading decisions, a person can gain lumps of money. But also, they can make that money disappear quickly. So, only invest what you afford to lose.
3. Buy and Hold
Probably, when you first heard of Bitcoin, you are thinking of buying and holding one. If we are going to look at it, it is considered one of the popular ways to make money in the cryptocurrency realm.
Buying and holding, or called "Hodling", is also one of the easiest ways to profit. The buying and holding technique are not specific to cryptocurrency as it works with other assets, like stocks or shares. It only involves buying a cryptocurrency, like Bitcoin, Ripple, Litecoin, or Ethereum, and holding onto that asset until it appreciates. From there, you can make a move to sell it and take the profit.
4. Accepting Crypto Coins
In the past decade, the acceptance of cryptocurrencies has been growing steadily. It is not only individuals interested in using and investing in them; it is also retailers that are now rushing to receive them. This again presents an exciting way to make money with cryptocurrencies. Also, it is one way to earn cryptocurrency, and all without even having to buy Bitcoin.
5. Invest in Trading Bots
Because of trading's fame and profitability, many cryptocurrency trading bots are developed to make the process a little easier and less energy-intensive.
Trading takes quite a lot of attention and focus. It can also be time-consuming and require a mastery of the skill to be incredibly successful. There is unending learning that goes into trading, and to start with, it would be a good move to invest with a trading bot. Click here to know more about trading cryptocurrency!
It would be best if you will be mindful of your actions as trading in cryptocurrency can get the best of you. The excitement won't always bring good returns, so be wise and patient. After all, it is your time and investment that you put into. We hope that you learned something new today about how to make money from trading cryptocurrency. Good luck with your trading!
UPDATED April 7, 2021
By: Hunter Shultz
Jargons can make you overwhelmed when starting and learning in cryptocurrency. Most newbies would quit and pull out their investments as they can’t wrap their heads around what they are doing.
UPDATED April 7, 2021
By: Hunter Shultz
If you are an aspiring crypto trader, you must be aware and familiar with all the aspects of bitcoin trading before entering the realm.
UPDATED April 6, 2021
By: Hunter Shultz
We’ll say it right off the bat – yes, you can! But with this outright statement, it also comes with the danger of losing your entire crypto investments.