Cryptocurrencies offer many opportunities for making money, and among them is trading.
A study from June 2022 estimated that at least 46 million Americans would invest in crypto, and this offers many opportunities for buying and selling crypto this year.
But before you start trading with cryptocurrencies, you must first know what you’re getting into. It’s possible to make a fortune via crypto, but it’s also possible to lose your shirt!
Here are the beginner crypto trading errors to avoid:
1. Using Real Money First
No matter how much you’ve read about crypto currency, you aren’t ready to jump right into trading.
You want to start with paper trading, which is a feature that almost any crypto exchange platform will allow. With this option, you’ll make an actual trade, but you won’t win or lose any crypto.
You should consider doing this for at least two months each day to master how crypto trading works. This may test your patience, and you’ll be eager to get started right away. But you must first learn how to trade cryptocurrencies before you risk your actual money.
2. Not Planning for Loss
Once you’ve begun trading with cryptocurrencies, you want to plan for loss. While you should always hope for the best, you must also prepare for the worst.
You should set limits on how much you wish to bet each day. You must also set limits on how much you can lose and when to stop when you win.
For example, you might decide that you’ll stop trading for the day if you lose $100. You might also choose to stop trading once you win $200. Never break these rules and remain consistent with them for at least three months before changing the limits.
3. Not Keeping Records
After each day of trading, use a spreadsheet to keep track of your crypto trading profits and losses.
You want to analyze these records at the end of each month to track your progress. This lets you decide if you need to make any major changes to your crypto trading strategy.
4. Not Doing Your Own Research
This can’t be stressed enough, but when you’re buying and selling crypto, you must trust your own research.
You’ll find tons of experts online giving advice on which cryptocurrencies to buy and when to sell. But you shouldn’t base your transactions based on someone else’s strategy.
Take at least an hour per day to research the cryptocurrency market. After you’ve done your research, you can plan your crypto trading strategy for the day.
Avoid These Beginner Crypto Trading Errors
Now you know the common beginner crypto trading errors to avoid. If you avoid these errors, you’ll have no problem with buying and selling crypto.
Always start by paper trading so you can first master the skills. Once you start trading with cryptocurrencies, make sure you set limits for losses and wins.
You must also keep records of your crypto trading profits and losses to help you track your progress. You have to also do your own research before you begin trading for the day.
You can find more articles about cryptocurrencies on our website.
