Since its invention in 2009, Bitcoin has gained worldwide visibility and more people today are willing to trade in it than ever before. Due to the advancements in technology that we’ve had over the years, the process of trading bitcoins has become easier. There are now digital tools available such as this bitcoin software to make it seamless. However, there are some strategies every bitcoin trader should know and leverage to help them with more successful results.
1. Do Your Research
This is the easiest strategy anyone could ever apply to a form of investment. Always do your homework and have adequate knowledge of what you are venturing into. However, the research doesn’t stop at the point where you start trading bitcoin. It continues, as you have to follow trends to know the best time to trade and how to make it work effectively for you. It also helps you stay up-to-date with what’s happening in the investment world and can give you an idea of whether or not to hold your bitcoin investments.
2. Have a Plan
Don’t just start investing because someone said it’s cool and an easy way to make money. Failure to plan before getting started is a solid mistake and there are several studies to back this including this research paper that highlights planning as an important attitude every investor must have.
You don’t have to start trading immediately you get to know about bitcoins. You can take your time to watch the market trends and map out a plan to determine your risk appetite, profit goal, and how much you’re willing to lose. As a quick rule of thumb, never invest what you can’t afford to lose. With a plan in place, you will be more strategic about your investments and trading.
HODLers refer to investors in crypto who buy and hold for as long as possible regardless of what the news or trends say. The term was coined in 2013 when a bitcoin user mistakenly typed the word “hodling” instead of “holding” to indicate that he was going to hold his investments even though the market seemed to be crashing at the time. The word is now used today for people willing to hold their investments.
One of the ways to make the most of your investments is to keep it for the long term. If you are patient enough, you will get some of the best returns in due time. However, bitcoin is unstable, which is why most people withdraw their investments while they can and get the profits. This is why you have to know your risk appetite and also follow the trends to help with your decision.
Bitcoin trading is a wide topic but these three strategies are important for any beginner. Getting started is easier now than ever and you can get a secure wallet to ensure that your investments are safe. There have been numerous cases of getting scammed of bitcoin units but you can reduce the risk of that happening by using a secure platform and also taking necessary measures against security threats.
Written by Callum Jackson