Cryptocurrency investing is an emotional roller coaster, even for experienced traders. Don’t let your emotions control your actions. Stick to your strategy, remember why you bought the coins you did, and don’t panic sell.
If you’re already invested and are seeing your positions bleeding value, you’re going to want to behave differently than if you’re sitting in cash waiting for an opportunity to invest (which is the best position to be in when the market falls).
If you’re lucky enough to have your investment capital in cash when the market dips…
Buy the Dip
There’s a term used in cryptocurrency called, “BTFD”. Which stands for, “Buy the F***ing Dip”.
Buying the dip, which means purchasing something when the price goes down, has been a winning strategy for Bitcoin investors since 2009. This concept isn’t new, there are quotes as old as Finance telling you to, “buy when there’s blood on the streets”.
When you identify a coin that you think is a good investment:
. Study the Chart
. Identify what you believe is a good entry point
. Set a limit order to buy at that price
. Walk away.
Believe it or not, the last step is often the hardest. One of the biggest issues I see people in our Trading Group facing is sticking to their strategy. They spend time researching entry points, but when they set their limit orders — they sit and wait for them to hit.
This is a TERRIBLE IDEA.
Turn on the TV, play some video games, do ANYTHING besides staring at the chart until your order goes through. Staring at charts after you’ve set your buys is a great way to allow yourself to second guess your own decisions and shoot yourself in the foot.
Figuring out good entry points is much harder than I make it seem here, I suggest finding a mentor or checking out a Technical Analysis course on Udemy.
Further Education: If you want to be able to read charts and make your own decisions on charts, start off with some basic TA. Learn about Candlestick Patterns, Chart Patterns, Support & Resistance, and ALL of the indicators on StockCharts.
full article here
http://www.bitcoininsider.org/article/18770/2-things-do-while-cryptocurrency-market-falls
