Top mistakes in crypto trading

CryptoMode Bitfinex Paper Trading

So, you have created an account on Binance, and bought a couple of Bitcoins and half a litecoin. Now you are ready to become a cryptocurrency trader. Before you even realize it, you find that one of the coins has soared by 10%. You realize you’ve made it.

You’re inspired by the «buy low, sell high» strategy and you’re already imagining your way: a bluebird Twitter account, lots of followers and fans waiting for your predictions, and of course, your Cabriolet in the driveway.

Things should work out just so, until you start to make every novice crypto trader’s mistake. You may escape all of them, if you use the automated crypto trading platform — It is very easy as you don’t have to do anything.

Crypto trader’s deadly sins

Realistically, all the mistakes not only by young traders, but also experienced traders are built on a small list of mistakes. But novice traders suffer more often:

  • Dependence on charts. Watching the green vertical bar is probably one of the most enjoyable things in the world, especially if you have invested at its base. However, if you don’t have your horse in this race, envy can play a cruel trick. You will invest in a growing asset, often with all your money. Perhaps this decision will become lucrative. But, sooner or later, you will be left with nothing.
  • Buying on illiquid markets. For your coin to go up in value, it needs someone else to want to buy it. The trouble with many emerging altcoins and many illiquid exchanges is that their listings are incredibly short. You may be convinced that a certain altcoin is the future of cryptocurrency, but if enough other traders don’t share your opinion, you run the risk of being left with a coin that no one wants to buy, or at least not at the price you thought it would be.
  • Writing the wrong price. Many people have accidentally counted the number of zeros wrong when placing an order and written a price 10 times lower than the market price. Your coins would fly off to a new owner in an instant. When you’re dealing with altcoins that are valued in many thousands of fractions of Bitcoin, it’s easy to do. Most exchanges have a protection mechanism against such errors. However, not all of them do. Always check the buy or sell price you are placing before you press Enter.
  • Revenge and emotions. Are you angry because you refused to buy a coin at the last minute and then it went up? Or have you bought a dead coin and realize that you can only get back a small part of what you invested? In anger, you bet everything on the first green coin you see and try to make a profit. You overestimate your options and enter a market you haven’t even investigated. What are your motives for entering and exiting? Why is the coin rising in value? You have no idea, because you act on emotion. Nine times out of ten, it will end badly.
  • Sending the wrong coin to an exchange wallet. If you send Bitcoin Cash to a Bitcoin wallet by mistake, don’t expect the exchange to make things right. Some will accommodate you, but not all. You are responsible for sending funds to the exchanger’s wallet, because such a mistake is almost impossible to correct.

Fixing these rookie trader mistakes won’t make you a capable crypto investor. There are still dozens of sleepless nights of watching charts and studying literature ahead. Forewarned is forearmed. Maybe these tips will just help you survive in the industry and wait for the moment when you become a cool trader.

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