https://www.thenfapost.com/2020/12/26/bitcoin-era-review-does-this-works-review-by-crypto-reviews/
Trading can be a fool's errand.
Trading (not investing) can a fool's errand, and most people are unprofitable at it. There, I said it. But I do it anyway, because I love doing it. In the beginning, for years, I lost money. The mistakes I made were numerous. But I did learn three big things. Such as...
Don’t panic.
Years ago, if I was long a position, seeing the stock take a 10% hit because of some news headline, I'd panic, sell the stock at the bottom, then watch it go back up a few days later, then I’d buy another stock, and do the same thing. I know, ridiculous.
If you're in a position, and it takes a significant hit, and if you feel yourself panicking, get up from your chair, and go make some hot chocolate, pet the dog, put together a puzzle, anything but sell your position. Trading is about patience and sticking to your strategy. And this leads to my second point...
Have a trading strategy and stick to it!
I look at the fundamentals and the technicals.
Fundamentals:
- Does the crypto have a long term viable and competitive advantage to the next best alternative? For example, Ethereum vs Cardano? How many users and developers? What is their growth trend? Is there robust liquidity in the protocol token/tokens and is that growing? You get the picture.
Technicals:
How far has the price deviated from the moving averages, the 20-day, 50-day, 200 day? And in the chart’s historical context, what is the standard deviation and likelihood of a mean reversion in the time frame I am trading? For example, if a crypto price is 30% above its 200 day and over the past year the price rarely gets above 20% its 200 day in any given 3 month rally, you probably should wait for a pull back to or below its 200 day before buying.
Are we in a bull or bear market? I am more likely to make more money in a “long” position when we are in a bull market and more likely to make money in a “short” position when we are in a bear market.
Longer term trades are better.
The less frequently I trade, the better I do. Trading too much drives me crazy, and eventually leads to many mistakes. Spreading out the trade from days to months so I don't have to pay attention to it 24/7 brings me larger winnings. And filing taxes is not such a freaking nightmare because I'm filling less trades. So I make more money with less trades and less work.
In Conclusion.
There you have it, three simple rules I follow in trading. Even though this wasn't meant to be exhaustive, and there are more rules, these are three big ones for me and they have saved me a lot of money and made me some decent returns.
Remember, trading is about probabilities of success over a given number of trades, it is not an exact science. You will win some and lose some, but if you don't panic; have a trading strategy; and focus on longer-term trades, you will have a higher probability of winning more than you lose, potentially, maybe, I did say trading is fool's errand, haha :)
Stay frosty people.
50% allocated to ph-fund.
