Source:pinterest

7 Cryptocurrency Trading Strategies that should be Avoided

Cryptocurrency has been present in the market for over a decade. But it has received so much attention in recent years. Cryptocurrency is a digital or virtual money which does not come under the government and central authorities control, the purpose of creating the cryptocurrency is to decrease the time of transactions, eliminate the third party involvement which also minimise the transaction charges. Cryptocurrency has raised the standard of living of so many peoples.

Cryptocurrency is the rage right now – attracting attention from people who have money to spare and people who don’t. Because it has become a phenomenon and, more importantly, because it is so accessible, everyone wants to become a cryptocurrency trader.

But there are so many investors that are still not aware how the cryptocurrency exchange market works and what things to keep in mind while investing in crypto, they just invest their money without knowing the crypto market as a result they might lose their money twitgoo.com. There are so many strategies that should be avoided by the new investors below given some strategies for your references:

1. Investing for short-term

Source:etmoney.com

Since the Cryptocurrency does not come under the government and central authority, the price of Cryptocurrency cannot be stable for more days. Cryptocurrency market is so volatile, as you know the Cryptocurrency is still new, so many things are still being tested out. if you are thinking you can invest in crypto for short term may be you will not able to achieve your goals and end up losing your money.

2. Jumping straight into the trading

Since you already know that the Cryptocurrency market is so volatile across the world. When the investors want to trade in crypto they first should understand the market how it works.

After that they should start investing in Cryptocurrency. If they jump in without understanding the market they might lose their money. There is so much content available in the market which will help you to understand the market and everything about Cryptocurrency.

3. Trustworthy Exchange Platforms

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As you know investing and trading in Cryptocurrency have become so popular across the world. Every new investor wants to invest in crypto and make but most of the new investors are not aware about scams happening in the Cryptocurrency exchange market. investors should understand there are lots of fraud platforms available in the market who are ready to snatch your money. It is very important to choose the right platform in order to perform exchange and trading in Cryptocurrency.

4. Buying crypto just because the price is low

Low cryptocurrency value does not always represent a good opportunity, there can be  several reasons why prices are low. Investors should monitor cryptocurrency with failing user rates. One of the reasons why Cryptocurrency are at low price is because maybe developers have left the Cryptocurrency.

5. Investing all your savings at one place

Either a stock market or a Cryptocurrency exchange market some of the new investors think that they should invest all their savings at one place to earn more profit which is not a one percent correct. Investors should invest their money in different crypto so that they can earn more profit.

6. Falling For Scams

Source:investopedia

There are so many online crypto exchange scams are happening of which new investors are not aware of the below are some examples of online crypto scams are given:

I. Cloud multiplier scams

It is one common online scams where scammers contact investors by email or text with a profit making opportunity, where they assure the investors to give double or triple the amounts in return if  they have put into bitcoin if they send their cryptocurrency to a particular digital wallet.

II. Spoofing

Spoofing means to exaggerate something to win over people’s trust. In a crypto scam. Scammers can easily increase or decrease the price of unknown cryptocurrencies by creating a fake buy or exchange and sometimes sending the value of the currencies skyrocketing by hundreds of per cent at a time.

When the traders who are not aware of that action rush to grab the deal, at that time scammers cancel the order and in some cases that can cause the price to crash as a result traders end up losing their money.

III. Fake Digital Crypto Wallet Software

As you know for storing a cryptocurrency traders are required to use a digital crypto wallet where they keep their cryptocurrency safe and secure. But there are also lots of fake digitals available in the market where you can lose all your cryptocurrency. The best suggestion is to stick with the trustworthy digital crypto wallet.

 IV. Fake Cryptocurrencies

Source:cinancemagnates.com

There are so many cryptocurrencies are available in the market and it is very difficult to differentiate which crypto is real or fake. When you invest in fake coins, the scammers can steal all your cryptocurrency. They do this through phishing – persuading you to click on links in emails that install spyware on your computer.

7. Not having a Solid exit plan

Before diving into any trade, new investors should make exit points. Generally most of the new investors do not have any exit point which ends up making things confused. It is important for the investors having both exit and entry points before getting into any trade.

For example, Let’s say 1 BTC = $36,000 (~₹26 lakh). You want to buy 0.1 coins at the current price – this makes it your entry point. Let’s say you want to make 20% on it, which means you will have to sell it when 1 BTC = $43,200 (~31.3 lakhs) – this is your exit point.

Conclusions

With the whole world looking up to the cryptocurrency to make investments in hope of a good return and to get rich, the market is actually subjected to the positioning of the stock market.New traders should first understand the crypto exchange and then start trading, investing and trading in crypto is a long term role.

All money invested is subjected to the various risks imposed by the stock market, and users can have a few losses down the lane. Investors are advised to invest in various crypto platforms only after thorough research and complete investigation.


Ricardo is a freelance writer specialized in politics. He is with foreignpolicyi.org from the beginning and helps it grow. Email: richardorland4[at]gmai.com