As bitcoin’s popularity is increasing with every passing day, the number of bitcoin traders is also increasing. Numerous beginners have started trading bitcoin considering the hype the currency has got recently. But most of them make some common mistakes that can be avoided for better results. Here are the common mix-ups enthusiastic bitcoin traders make that prove them fatal.
- Trading emotionally
Not only beginners, but many enthusiastic bitcoin traders also tend to mix their emotions with trading. If you want to have a smooth trading experience by executing your best strategies, you have to keep your emotions away from your trading. Try to make decisions in an objective way. That is why it is advisable to use trading bots like immediate edge, as they help reduce the risk of human error in trading because they are programmed to follow predetermined rules and parameters. According to immediate edge stiftung warentest, it is a credible platform to make decisions and execute trades faster than manual traders.
- Buying high and selling low
This is a common mistake committed by the newcomers. They tend to buy bitcoins at high prices and sell them at low prices. Smart traders will not get moved by a 200% increase and try to make profits out of the market trend. They do not sell all their assets when the market crashes to 70% but try to buy more. This is how an understanding traders must follow in bitcoin trading.
- Buying and selling at once
After committing the first two mistakes, bitcoin traders try to sell or buy their bitcoins all at once rather than doing it in small proportions. An expert trader will sell his 20% bitcoins only when he gets a 50% profit. The remaining 20% will be sold at a 100% profit, and for the next 20%, he will expect a profit of an extra 50%. This method is called Dollar Cost Averaging. Thus you will always earn profit and will have money to buy more coins when the price falls.
- Falling for fake currencies
Enthusiastic bitcoin traders always fall for the fake promises and values the new cryptocurrencies offer. But the fact is that they will not have any technical advancements and most of them feature decentralized blockchains. Tron, EOS, Litecoin, NEO, etc are all examples.
- Trying several cryptocurrencies at once
Some traders buy different cryptocurrencies but it is not at all beneficial. It reduces your profits marginally and there are not many reliable and robust cryptocurrencies available. Therefore look for the safest and most reliable 4-7 crypto coins and eliminate the rest. All crypto coins will not be able to survive. Have market research and choose the coins with millions of sales and users.
- Investing everything in a single currency, wallet, and exchange
Several beginners tend to go for a single Altcoin and invest their whole money in it. But it is very important to have a diversified portfolio to gain maximum profits. Some deposit all their investments in a single wallet of one crypto exchange. Put your investment in at least 3 digital wallets to ensure safety.
- Investing too much
Many enthusiastic traders invest a lot of money in bitcoin, which will be more than what they can afford to lose. This will activate emotional trading and lead to huge losses. Try to invest in small amounts and gradually grow your funds with expertise in trading. For potentially profitable investments, meme coins like Ai Doge 2023 can also be worth considering. Bitcoin and other crypto trading involve high risk so it is advisable to invest only the amount traders can afford to lose