Bitcoin is very different from what you call gambling. It is about a chain of computations and complex calculations that make the mining of Bitcoin important in this direction. It is no doubt a great investment and trading alternative to the stock and derivatives market but it holds equal risks as well. Especially for beginners who sometimes get blinded by the stories that they have heard and end up losing a lot of their hard-earned money in this market. Many things should be known by every trader involved in the trading process, and they can gather this information through various trading platforms.
We bring to you some of the very basic steps that if a beginner follows, he or she will at least reduce the chances of making mistakes in this market and losing their money. The steps are as follows:
- Learn and understand the factors that affect Bitcoin’s movement: To get started with bitcoin trading the first and foremost thing to understand and learn are the factors that affect the movement in Bitcoin’s price movement. Market research and an understanding that market tricks is very essential to have the best returns for Bitcoin. Choosing the right exchange that is safe and secure is a must.
These factors include the bitcoin supply which is extremely important to understand because as we all know bitcoin is finite in number and is expected to exhaust by 20140. Just like the stock market, bad press affects the price movement of bitcoin as well.
- Select a suitable trading style and strategy: Selecting a particular trading style and mastering it is also essential. Specialising in your selected trading strategy will take you on the road to success. The major trading types that one deal in include:
Day Trading
Trend Trading
Bitcoin Hedging
Buy And Hold
- Choose a reliable trading platform: This brings us to one of the most important steps in bitcoin trading, selecting the right platform. You should have enough funds in your account so that the process of trading becomes easier. From online, you should check the trading account in such a manner that the fund directly gets deposited to your bank account.
- Research well and respect your research and the market: Good research in any type of trading will take you a long way. Don’t just invest in a currency because you’ve heard someone investing or someone you know has invested in it. Do your own research and stay confident about it. A sign of a disciplined and successful trader is that he or she stays confident until they hit their targets. Use tools like stop loss and limits to become more disciplined in bitcoin trading. For instance, if you know the coins well, but you do not know how to store them properly, then that can be a major problem. You should know how to save your hard-earned amount from phishing attacks or other cyber threats.
- Monitoring your trade: A lot of beginners have the habit of investing in a digital asset and waiting until they hear about their investment from someone or somewhere. Even if you are out of time and do not have hours to monitor a few minutes of monitoring can also do the job but stay aware and updated on what is going on in the market. You can alter your strategies while you trade, mix and match and find out which suits you the most.
- Close your positions yourself: This is probably the last step that if a beginner follows, his or her trading journey can be super smooth. If you are facing a loss in a particular trade don’t wait for the platform to square off your trade. Set limits and stop losses after due research and even if they don’t work out book your losses and prepare for the next trade with a fresh mind. Never go behind recovering losses as it will only make you lose more money.
Conclusion: Trading bitcoin can be really complex and time-consuming for beginners. You may face situations where you feel like quitting this field but a sensible and careful approach towards it with patience will help you ace this space. Follow some of these initial steps and stay disciplined. These are some of the steps that will help you trade bitcoins as a beginner without making mistakes and losing money where you don’t have to.
