Crypto trading can be very rewarding and frustrating at the same time. Research shows that the fluctuation in price can be up to 20% in a day, making the market a very volatile one,
so one needs to be careful when trading.
I understand that as a beginner avoiding losses can be a struggle, but taking some proper steps and putting some strategies into consideration can help you avoid or reduce losses.
Below are a few tips to help you out;
Always trade at: KNIGHTS
1. Don’t base your buying decision on low price alone
I know you must have heard or seen people in the space buying coins because of their dips, but a coin experience dip doesn’t always mean it is a good time to buy. Some coins drop and never come up again It may be that the developer has ghosted the community, so before buying a dip coin check out the market trend of the coin. This will help you decide better.
2. Don’t put your eggs in one basket
A lot of beginners make the mistake of investing in just one coin. This can be very detrimental if there is a huge dip in that coin, so spread your trading capital. For instance, if your trading capital is a tool of $500 you can buy 5 different coins and not just one. This way if one or two coins dip you can recover your loss from the other coins.
3. Use spare money to trade.
Many beginners come into the space with the mentality that they can make double, triple and more from their crypto investment. Yes while that is true your loss can also be very dramatic since the market is volatile, so invest money you can afford to lose and one that can make you bankrupt.
4. Don’t fall for scams
The crypto space just like any successful space is also saturated with scammers and hackers who are ready to dupe you of your crypto, so be very watchful. Here are some common ways you can be scammed or hacked;
- Cloud multiplier scams: These scams come to you as a problem solver or someone that has your interest at heart, asking you to enter your wallet details in a link.
- Spoofing: Hackers can tamper with the price of a new or an unknown coin promoting people to buy and then withdraw, making the price of the coin fall.
- Scam wallet software: Before with the type of wallet software you use if it not the popular ones like metamask, coin base, etc. Desist from using them unless you’re 100% sure because scammers can use this wallet to steal your coins.
- Fake coins: Some scammers can send you a link via email or use phishing sites to persuade you to enter your wallet details.
5. Don’t sell in a panic mode
As a beginner, it can be very tempting to quickly sell when your coin dips, but this is not always safe. Before selling ensure that the coin value has depreciated total by looking up the coin analysis. Crypto trading requires trading smartly and patiently, Knowing when to enter and when to get out is key.
6. Don’t forget your key phrase
When you newly open your crypto wallet you’ll be given a key phrase which is the key to grant you access to your crypto wallet if you want to withdraw, recover your wallet, or transfer it to a new device or browser, so keep it safe and don’t let it fall into the wrong hands. This is so you do to lose your crypto.
As a beginner, it is understandable that you may make losses at the beginning, that is okay even pros in the space also experience losses, but what you don’t want are redeemable or preventable losses, so with the above tips, you should be able to avoid or reduce them., Do you have any tips on how to avoid or reduce losses in crypto trading kindly share your tips in the comment section.
Always trade at: KNIGHTS