Cryptocurrency and ICO news 10.08.2018
Simple tips to save funds in a falling market
Crypto market is falling, but anyway there are people that can make money even in these circumstances. Leading cryptocurrencies recently almost hit year-low, which was reached previously in April: Ethereum and Bitcoin prices decreased to $368 and $6600 respectively that time. The market becomes even more volatile than before, so ICOCrunch team decided to make a list of tips for our subscribers that can help to lower the losses or to enter the market as this is the most appropriate time for this.
- Diversify your portfolio
Diversifying is a process of spreading your funds on several assets. It usually implements to lower the risks of losing funds in case a person invested only in one currency. At the same time, it can increase possible profit as the person invested in several assets that in average can give bigger multiplier than only one currency.
- Fix your profits
Your asset skyrocketed – it is good. But you will get nothing if you delay selling this asset as the market is very volatile. Thus, we recommend using “Take profit” tool. Yes, it can lower possible profit, but it will guarantee it on a certain level as well. The best option is to sell currency on several profitable levels. For example, set half of your currency on the price level that grants +15%, and another half – on +20%. If your analysis was right, you will receive an average of 17,5% profit, risks were covered with Take Profit tool. Now you can reinvest.
- Don’t perform panic sell
For many people, much of cryptocurrency trading is dominated by emotions. This usually leads to bigger losses when people start panic sell on correction wave or lower profits when people sell everything with first upward movements. If you are not planning to become professional trader and perform day-trade – do not sell your currencies for bit of cash. Selling should be dictated by many factors: your profit goals, fundamental background (news, updates), etc. Stick to the facts, and you’ll do well.
- Find the most efficient way to purchase and store coins for you
It will depend on what strategy you will choose. Long-term investing – hardware wallet is the safest option. Mid-term investing and trading – respectable crypto-exchange but still it would be better if you saved part of your funds on the wallet. Choosing exchange always pay attention to their development, daily trading volumes, history of hacks, available tools for analysis, etc.
- Focus on profit
One of the biggest mental hurdles crypto traders run into is the idea of profit versus the idea of being right. It is a small difference, but it will affect your decisions. You do not just want to be correct in determining which coins will rise in value, you actually want to profit from them.
You could be correct most of the time, but if you do not invest in the right coins, you will barely make a profit. Alternatively, focusing on profit pushes you to think not just of which coins will gain value, but which ones will do so the most. Again, a small difference, but it is the difference between small gains and making a fortune.
- Use fiat currencies as a benchmark
When determining a coin’s value, stick to comparing it to fiat currencies like US dollars. This will give you a clearer idea whether or not something gained or lost value. There are several hybrid tactics of trading, when you should consider both crypto-crypto and crypto-fiat pairs, but it also depends on what strategy you will choose.
- Buy immediately
Many people hesitate to buy their coins because of one simple reason – market manipulation. Due to lack of regulations, groups and companies can pull pump-and-dump scams over and over again until they get the profit they want. This can make buying coins feel awkward because it seems like you’ll always miss out on getting them for cheaper at some point.
This fear of missing out is natural, but this is also something you should ignore. Predicting market manipulation or news-related dips is practically impossible. It’s better to buy-in and miss out on a little dip than not to buy at all and lose the opportunity when it corrects itself. Moreover, just use Stop Loss or Take profit tools and your risks are covered.
- Manage your emotions
The most dangerous thing in your quest to trade and invest in coins isn’t the unregulated landscape or the scams that run rampant in it – it’s your emotions. Market fluctuations can make you nervous: if your coins lose value, you’ll think about pulling out. If they grow, you’ll start thinking about whether you should hold.
This emotional response is natural. Given that the history of cryptocurrency is filled with incredible spikes and crashes, it’s not surprising that many flinch at every fluctuation. However, if you want to be successful and turn a profit, you need to ignore your emotions and focus on the numbers. Don’t get distracted by fear.
- If you’re not sure, don’t
One of the best pieces of advice you will get when investing in cryptocurrency is to only use money you are okay with losing – because that’s exactly what might happen. It doesn’t matter how promising the technology is, or how amazing the team behind it, there’s always the chance that you’ll lose everything you invested.
Sometimes it is good to listen to yourself. If you’re not sure about a coin, don’t buy it. It’s the fear of missing out (FOMO) that drives many to take risks, when really there’s no reason to rush. There will be more coins. Dips that will let you enter will come later. This also applies to selling. If you think you can make a little bit more, go for it. If you have no reason to think that it will dip when you’re not looking, hold.
- Focus on coins circulating supply relative to maximum supply
The law of supply and demand is in full force for cryptocurrencies. That’s why pump-and-dump schemes still work. The more people buying a coin, the more its value will rise. This is why you can’t just look at a coin and think it’s a good buy because it’s cheap.
Its value must be studied relative to its circulating supply. The closer the number of coins in circulation to the maximum number that can be mined, the more likely it is to rise in value. This is due to its lack of supply compared to rising demand.
Crypto trading can be profitable but it is still risky. If you want to try or you are already in the market – you need to be smart, know about the most important news in this industry and perform trading with a cold mind.
Besides, the most important news from crypto-world you may find in our channels as we perform daily and weekly news digests!
Thanks for being with us and good luck!