With the huge boom in the cryptocurrency market and with the rise of the bitcoin to over $20,000 per coin, you need to be crazy not to invest in this industry. You have probably been hearing about people getting rich from buying low and selling this cryptocurrency online and about all the different strategies you can use, but is it really that easy?
Check out a few things you should know for your bitcoin trade.
Understand the Market Trends
Well, if you have no understanding of the market and if you have no experience in trading, getting into it can be a bit confusing and difficult. However, with the right knowledge and strategies, you can easily start profiting from bitcoin.
A lot of experts also believe that this industry will continue growing, so the sooner you invest in it, the bigger the chances you make a serious profit from it.
Trade vs Investment
Before we get deeper into this subject we need to explain the differences between a trade and an investment.
When people invest in Bitcoin, it means that they have a plan to hold onto it until it reaches a certain high and then sell it at that point. For example, many people who bought it for two or three thousand dollars managed to sell it for more than twenty thousand dollars. That’s at least ten times the worth. Some, even plan to hold onto it for multiple years, expecting that the worth of this coin will rise to a worth of multiple million dollars. This may be a good idea since we can’t really predict the future, but it is not as reliable.
The other option is to start trading bitcoin. You are constantly buying it and selling it whenever you can profit from it. Even a slight rise of just a few dollars is enough of a reason to sell everything you’ve bought and then purchase another batch of bitcoin again when the value drops as explained here. You need to look at it as a way to constantly make a profit, not as something that you need to hold on to.
Keep your Analytics in Check
Keep in mind, this whole market is very volatile which means that you will have to track the values constantly. One day the value of the bitcoin might reach $20,000 to $30,000 and the next day it might crash to below a thousand.
Use Exchange sites
So, to start trading, you will need a few things. First, you will need to create a crypto wallet which basically works like a real-life wallet. Every cryptocurrency that you purchase can be stored into this encrypted wallet that will keep all of your information and coins safe.
To create such a wallet you will need to find the right exchange site.
1. Binance
Easily the biggest Bitcoin exchange website that is still rapidly growing. It is based in Malta and offers the biggest marketplace for cryptocurrencies.
3. Immediate Edge
Immediate Edge is an app that allows you to use a bot for cryptocurrency bot. It is built with an advanced algorithm that will do most of the work when it comes to trading. Check out this Immediate Edge review if you want to know more about the application at bitcointocrypto.
3. Coinbase
Also a very popular exchange website, especially in the United State. They have quite a good and in-depth interface, so you can easily track the market.
You have finally found your perfect exchange website and have created your own wallet which means the next step is to start doing a bit of trading.
But, before you get into it, here are some common mistakes that everyone does when getting into this industry.
Don’t risk it if you don’t have the money
The biggest mistake every person makes when they get into trading is that they start risking money they shouldn’t lose. Just because you have such an amount of money in your bank account, does not mean that you should spend all of them. Before you invest them, you will need to ask yourself a couple of questions such as: Would I be able to pay my bills if I lost all of them? Will I need them for something more important such as repairing my car or my house? Will it change my way of life?
Once you go through this set of questions you will quickly understand what you can and can’t afford to lose. You do not want your entire life to be affected just because you have decided to start trading bitcoin. Your health is more important than anything.
Sure, playing risky might give you a big payoff, but if you lose, then you will be in a very bad situation.
Create a plan
Before you start trading the cryptocurrency you have bought you should have a plan ready. You do not want to lose everything you have in just one day. Make a certain goal you want to reach throughout the week or month and stick to it. If your plan is to double the value of your wallet in one week, then make sure to keep that in mind and don’t overshoot. When you start going off the course of your plan that is when you will lose your money.
Don’t rely on an exchange site
Every single exchange website claims that they have crazy amounts of security to prevent people from stealing your private information, your wallet or your password and that’s true. However, considering what kind of attention cryptocurrency is pulling, there is always the chance of the website being hacked. Even if it cannot be hacked, there is also the chance of it going offline. So, if you leave your bitcoin on your website’s account and it goes offline, you will lose it.
Make sure that you always take out your cryptocurrencies and keep them safe in your own wallet.
