First Step towards successful Cryptocurrencies trader!

Background

As with time, the market price of the cryptocurrency is going upward it is attracting more and more people to start trading in cryptocurrencies. Some people are even claiming that they can pay Pakistan debts using crypto trading if they are given full control of the country. Due to these all, a lot of people (who had no prior knowledge of trading or crypto market) are entering the market at the wrong times. Instead of entering at the lowest entry point (the most suitable time of entry), they end up entering mainly at the highest points (when it's time to cash profits), and as a result, lose all their earnings. In trading jargon, this is a classical example of the fear of missing out (FOMO).

FOMO: The fear of missing out

In simple words, the fear of missing out (FOMO) refers to a situation in which new traders enter the market at the wrong time and end up losing their investment. FOMO can be avoided if the new traders know and have patient that the market is not “running away” and that it is going to give them opportunities, again and again, the only issue is that they should be able to make money out of these opportunities. It is only possible if they have the required skills and learning.

Skills Requirement for successful cryptocurrency traders

To be a successful crypto trader one has to learn new skills. At this point, I will focus on two basic skills. The first one is technical knowledge that includes the ability to do technical analysis of a particular cryptocurrency in which the trader wants to trade, to read various indicators (more details on it in upcoming blogs), graphs and being able to know when to enter or exit the market. It is easy to say then to done. Entry and exit are the most important decision because they ensure money-making during trading.

The second skill set contains risk management. At any given point in time, the market has three possibilities. It will either go up, in which case the risk management strategy aims for maximizing the profit from the trade, or it may go down, in which case the aim for a trader is to minimize the loss, as most people lose money when the market goes down. The third possibility is the side-way moment of the market, in which the market does not go move very high or low but remain in a medium moment. In such a case, trading aims to make the trade profitable.

by Prof. Schrwed Senior

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