Updated 6/1/2021 – Trading bitcoin and crypto is no easy task. The above picture is the average person freaking out when the market does not go their way. This is Jill, PLEASE we repeat! Don’t be Jill…
Jill Trading Bitcoin…
- Firstly – Jill is an adrenaline junkie, unfortunately, she is an adrenaline junkie in trading crypto.
- Secondly – Jill will buy a coin just because somebody on the trading view mentions it. Screaming that it was going up 500% next week!
- Thirdly – Jill will sell any coin as soon as she reads on coindesk. About some China news of them banning exchanges/ICOs. Which they do about a few times a month it seems.
- Fourthly – Jill trades with her thoughts and feelings, she is always right even though she only loses money.
- Lastly – Jill thinks it all is a conspiracy by the government/Hollywood to keep her down” . In short as you see here, Jill has issues and has no idea what she is doing.
Unfortunately, the majority of newbie traders have this un-solid emotional state. Jill is caught in the EMOTIONS trap vs real objective knowledge.
When starting out in something new, you will be in that realm. It is normal until you learn the ins and outs of trading Bitcoin and other cryptocurrencies. Here are some steps you can use to learn to control your emotions. This will help you have a more happy and safer journey in your crypto trading adventures.
1) Never invest money you can’t afford to lose.
This is the #1 rule for all investing and trading. Trading and trading too large of sums will effect your emotional state greatly for the average trader or investor. If you are new to trading, then you are a Newbie/Noob. A greenhorn, and many other colorful words to note your lack of experience and knowledge in bitcoin or cryptocurrency trading.
Like most Noobs, you will likely focus on the PROFITS! Having a total disregard for the RISK! Trading is a zero-sum game, with every winner there is a loser. Trading is war! The risk here is your capital. Being a noob means you are a big painted target on the field of battle. So keep your head down listen to your superiors and try not to get shot! The SEC/FTC state this repeatedly and it is one of the few things I wholeheartedly agree with them on.
So if you were planning to go all-in on trading bitcoin or some fancy ALT coin. Once again that you could not lose on! Well again, imagine you did lose and you lost all of what you invested?! How would you feel about that? What kind of impact might it have on your state of mind or well being. So please heed these words as they are very much for your well being.
If you learn to trade correctly and become experienced over time, the profits will come. You are far better off being a grain of sand that turns into a mountain. Rather than a mountain that turns into a grain of sand…
2) Get Educated!
This is one of the areas most fail when starting. They think they can just read a few articles or watch some videos on trading and WHAM! They are a pro-trader ready to work for Goldman Sachs or some hedge fund. Often don’t find out till later after some severe losses. Just how not a pro-trader they are in trading Bitcoin or other cryptos.
Thus this is where the value of education comes into play. There are many resources on this site that can point you in the right direction. No matter what you choose, consider getting the proper education to learn to navigate and profit in the cryptocurrency space. The time and or money invested here may very well not only help you grow. But it might save you from some very expensive mistakes.
3) Join a Signal Service
and watch Pro traders trade. This is one of my favs for a newbie to do. As what better way can you learn to profit trading Bitcoin? Then by watching somebody else who is talented at it make live trades!
You can gain experience by osmosis here and if you read our site. You can see we are very very Signal Provider Friendly/informative here. As to the best and brightest in this field. This kind of goes along with education. Not only taking part in the signals but learning how and what they are derived from in time. To note some signal services are more education-friendly then others. The effects of watching live signals can’t be understated at all. A great deal can be learned in style and temperament of the different traders. Find our hand-selected list of crypto signal providers here.
4) Keep a Journal
of your trades and trading. Much of learning is to make a habit of things. A journal is a perfect way to reflect and note those habits both good and bad. Along with this to correct what does not work and keep doing more of what does work.
For instance reflecting and going over again and again why you did certain trades. Maybe how you felt and what you could have done better. You can get insight into your inner dialog. Hence learning to improve the language in time to a profitable and harmonious one. You do this by remembering and calculating events of the past.
This in time lends itself to having a calming effect by forcing one to confront their actions both good and bad over time, there you will learn to handle things through consistent reflection and objective planning.
5) Meditate
Even if it is no more then 5 minutes. Believe it or not, trading is very STRESSFUL for most and causes many to become unhinged. Taking some time before or after a trading session to clear your mind and just breathe is very wise indeed.
Also you really want to not let emotions cloud your judgment, this is one way of doing that. Being mindfully aware of yourself/feelings is critical in order to perform as a higher level trader. Closing your eyes and breathing, reviewing your feelings/thoughts. Consequently they might have impacted your trading decisions vs following your plans/rules based on objective criteria.
Laying out plans will help you amend and stay focused on future objectives. Meditation can also help you focus and balance your feelings in a positive rational way vs a random destructive one. Think of it this way, you are in a boat. Steering yourself through the waves or have you fallen overboard at the mercy of the raging red tide…
Sun Tzu – Trading Bitcoin
Know yourself & know your Enemy… Sun Tzu was not exactly a nice guy, but he was one, if not the best military generals that ever existed. I suggest you read his work back to front a few times. As a trader his advice is beyond valuable.
“How to”
One of the most important things as a trader is not only to understand trading both fundamentally and technically but to understand making strategic and tactical decisions. But before you can even go there first understand yourself as a trader. If we can correct the things that limit us we can grow and make good trades. So know not only how to trade bitcoin but know how you will act/think when you are making your trading plans…
Sun Tzu never entered a battle he did not already calculate he would win and calculate his own strengths and weaknesses ahead of time to make sure the truth of his true abilities and that of his mens were in perfect alignment… Know yourself, Know your enemy…
Bitcoin Trading in conclusion…
The market is neither kind nor unkind, it is learning to thread a needle in the eye of a storm, inside you will find perfection and harmony, outside a chaotic sea of an endless ocean of misery. You are an emotional being and that being said, you are in control of your own ship. Don’t sail into reefs or rough seas if it is not needed, and if you do learn how to sail out of them by holding fast and steady. The above tips will help in learning to control the oncoming waves. I guess Sun Tzu said it best with the picture below. It is not enough to know our enemy, we must know ourselves as well in order to see true victory…
[…] and won’t cause a loss if it gets stopped out. Just like Kenny Rogers’s song “The Gambler,” You gotta know when to buy, hold, sell, cut your losses, and walk […]
Great article! I loved the read. I did not buy gold with bitcoins at Bullion Exchanges. I really wanted to own physical gold and Bullion Exchanges makes this possible for me by accepting bitcoins as a form of payment. Unfortunately, they placed comment spam on some crypto websites on the internet, so I did not exchange it there, as it is somehow fishy and I would never send my cryptos to a company that is spamming blogs to gain new customers.