If you’re just starting out as a trader, then you may have run into some obstacles. Things, like taking losses, pushing bad trading ideas, or just trading emotionally, may have impacted you. But don’t despair! Analysts at Monfex, the world’s leading cryptocurrency trading platform, has gathered the following top 10 tips to help you, thanks to our decades-long experience in the trading business.
- 1 Have Clear Goals and A Trading Style That Fits You
- 2 2. Choose The Right Broker
- 3 3. Choose A Strategy And Stick To It
- 4 4. Carefully Choose Your Timeframes
- 5 5. Use Quantitative Metrics
- 6 6. Never Mix Your Finances and Your Trading
- 7 7. Be Confident In Your Plans
- 8 8. Never Stop Analyzing the Market
- 9 9. Keep a Trading Journal
- 10 10. Stay Structured
Have Clear Goals and A Trading Style That Fits You
Whenever you decide to do a task, you usually have an idea of what the end goal is supposed to be, and trading is no different. A clear goal should be something more concrete than ‘I want to make money’, but instead have set goals, milestones, and deadlines. Your trading style will depend on these markers, and every trading style has a different risk profile, which all require different attitudes to use properly.
If you get anxious leaving a position open overnight – then that’s a sign that you may want to stick to day trading. Or, if you’re taking a medium- or long-term view, then you might want to be more of a position trader. Always make sure that your goals, your trading style, and your personality all fit together, or you’ll be exposing yourself to unnecessary loss and risk. Luckily, you can rely on Monfex’s large collection of trading tutorials and tips to help you choose a trading style that works for you.
2. Choose The Right Broker
Making sure that the broker or trading platform you’re using is the right fit for you is one of the key tasks when starting out as a trader. Every broker has their own policies, limits, and fees – for example, Monfex is an industry-leading trading platform, offering leverage up to 50x on 12 of the most popular crypto pairs in the world.
Choose how you want to fund your trading – via crypto, fiat, or some other method, and the fees are taken during trading. You also may want to ensure that the broker or trading platform you use allows you to make the analysis you want.
If you’re comfortable setting support and resistance levels and watching moving averages, then make sure that the platform’s interface allows you to do so. Ultimately, you want a stable, reputable broker with a large variety of instruments, high leverage limits, and guarantees that you won’t be liquidated at an inappropriate time.
3. Choose A Strategy And Stick To It
Having a sound trading strategy is one of the most important steps a trader can take to improve their outcomes. A trading strategy will help you set clear rules for entering or exiting positions. It can also provide you with the analytical tools you need to properly evaluate the market. No matter if you decide to stick to only fundamental or technical analysis, or more likely a mix of the two, making sure that you have a set strategy is fundamental to success.
You can also rely on the advice of others, especially the analysts at Monfex. They post daily on Tradingview.com, a website for trading professionals to exchange ideas and tips. Go ahead and check out Monfex’s ideas and predictions on Tradingview, and decide for yourself if they work for you!
4. Carefully Choose Your Timeframes
Timeframes are crucial elements of analysis and trading ideas but are sometimes overlooked. What seems to be a buy signal on a daily chart can easily be a sell on a weekly chart or vice versa.
If you’re looking at a 5-day chart but entering on a daily, always make sure to synchronize the two to ensure that you’re not accidentally misreading a signal. Always make sure that you’re seeing the same signals on the timeframes you’re considering before committing to a trade. Luckily, the Monfex trading platform provides traders with an in-depth, editable chart to be able to view whatever timeframe you want. Sign up today and start making use of Monfex’s revolutionary, user-friendly design!
5. Use Quantitative Metrics
It goes without saying that trading is a business focused primarily on numbers. Whether that’s prices, moving averages, margins, or anything else, trading is 100% a numbers game. Since that’s true, it stands to reason that you should be able to pull objective, quantitative metrics on your trading performance. One such metric is known as expectancy, and it lets you see how your trading strategy has performed over some past period, like your last 10 trades.
By knowing your expectancy, you can easily test and see if the returns your trading strategy is offering fit your goals. Just keep in mind that if the formula outputs a negative number, you’d actually be losing money, so ensure your strategies aren’t leading you down a losing path before putting them into action. A great place to put your metrics into action is the Monfex trading platform, which is specifically designed for both new and experienced traders and offers up to 50x leverage on 12 coin pairs.
6. Never Mix Your Finances and Your Trading
Trading, no matter how small, is an inherently risky activity, and you always want to make sure that you’re managing that risk. One thing you should always make sure is that you can always afford to lose the funding in your trading account. Never use the money for living expenses on trading, instead, track it as a separate luxury.
If you go through a few bad trades and end up losing your account – that money is already considered spent in your budget, so it isn’t a big deal to refund and continue trading. This will also help you manage stress when you lose trades – remember that as long as your expectancy is positive, you’ll be coming out profitable even if you lose a lot of trades. The low fees present on the Monfex trading platform gives you the best opportunity to place trades without having to worry about extra math turning your profit into a loss!
7. Be Confident In Your Plans
Trading can sometimes be an emotional rollercoaster, with high ups when you’re doing well and miserable downs if you’re doing poorly. However, the best traders keep their emotions separate from their trading behaviors. You can also draw confidence by studying the training materials available on the Monfex website, which have collected the best advice, ideas, and strategies.
If you’ve worked out a trading strategy, don’t allow a small loss to demoralize you and cause you to switch – instead, give it time, and if it fails overall, take an objective look back at your models and see what went wrong. Have confidence in yourself and your trading plan, both in success and in failure.
8. Never Stop Analyzing the Market
Unlike traditional markets, crypto markets never close, even if they have cycles of activity. And that means that unlike stock or forex markets, where the weekends are a time for pause and reflection, the crypto trader can never stop being vigilant. The volatility of crypto markets can mean that markets are liable to change in an instant, turning profitable positions into losing ones.
One of the best ways to stay on top of the ever-changing crypto market is by following experienced analysts, such as Monfex, on technical analysis sites like Tradingview. The Monfex account on Tradingview has tens of thousands of views, as well as a large following and community, all interested in Monfex’s proven trading ideas and strategies.
9. Keep a Trading Journal
One of the best but commonly overlooked tools for traders is a trading journal. A trading journal is just a list of every trade you’ve committed, along with explicit reasons for entering and exiting your trades. By taking time every week to review your trading journal, you can tell when you are following your strategy, and when you’re making emotional moves.
Remember that trading is based on psychology, but profitable traders take advantage of psychology to inform their decisions, instead of letting psychology make their decisions for them. Monfex, an industry-leading trading platform, allows users to view a detailed trade history, which is invaluable when it comes to keeping a good record of your trades.
10. Stay Structured
The last tip is often the most important, and it stresses the importance of treating trading in a structured, systematic way. Remember that real money is on the line, and the single best way to ensure that you come out in the black is to have your trading process, from your strategy to your goals, clear, quantifiable, and objective.
And by trading on the Monfex platform, you can remove at least one source of emotional stress by feeling secure that your funds and your positions are protected from sudden closures or liquidations. Emotions can lead to bad decisions – or, even good ones – but they won’t help you improve as a trader in the long run. Staying structured is the key to profitable trading.
Monfex Research Department: www.monfex.com
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Disclosure: This is a sponsored press release