Ask Yourself 3 Questions Before Trading Bitcoin
To say that Bitcoin steals the spotlight of stocks and most other assets would be an understatement.
The biggest cryptocurrency by market cap reached its all-time high price of $58,012 and valued at $1 trillion in February. Although its price tumbled to $43,000, following the footsteps of the stock market, Bitcoin has gained over 1200% from its in the past years.
Still, market sentiments are divided on whether Bitcoin is a scam or the very tool to transform our payment system. Its high volatility means that traders can multiple their funds in a couple of months, or even weeks, and can lose their shirt as fast. If you are an on-looker looking for ways to enter the crypto world, ask yourself these questions before putting your funds in Bitcoin.
Do you have a diversified portfolio?
It’s crucial to have clear investing strategies when you are dealing with an asset as volatile as Bitcoin. Always divide your investments into two parts: one is what you can afford to lose and the other you can’t.
There are numerous ways of investing in Bitcoin, among them the most popular ones are futures trading and hodling. In futures trading, trading can earn Bitcoin by speculating the directions of Bitcoin’s price and enhance exposure by borrowing leverage from exchanges. For instance, with 100x leverage, a trader can open a position worth 10 BTC with just 0.1 BTC. When the price goes up(down) 1%, the trader can earn 0.1 BTC. When the market trend is strong, futures trading is one way to earn Bitcoin quickly and easily. But traders can also get their position liquidated when the trend reverses. Always only invest what you can afford to lose in futures trading. For the other part, hodling tight or storing it in an interest wallet to earn passive income with little risks.
Can you devote time and energy to learning to trade?
This question distinguishes those who make their profits by luck and those who reach their goals by themselves. There’s a learning curve to learn something new, for Bitcoin futures trading, it takes you only 10 minutes to understand the mechanism but it can take a few days to build your principles and strategies after attempts of real trading. It’s common for beginners to get lost in a variety of new concepts and learning the ins and outs of an exchange and trading engine could be difficult. So if you are new to crypto trading, it is recommended that you practice first in a trading simulator. And don’t hesitate to consult help centers when you trade on exchanges.
Are you able to be conscious of your emotional swing and control it?
Losing an investment will hurt you for a while and every successful trader has a long list of loss records. The suitable trading signal can happen right away just one minute after your loss, those who feel angry and confused will miss the good trading signals and fall to bad signals. Again, practice more, keep track of your trading plans and set stop-loss. You can also use a smartphone to monitor your investments as Bitcoin trades around the clock. Take the Bexplus app as an example, its 24/7 notification helps you better manage positions during huge price swings.
Bexplus is a recommended leverage trading platform that doesn’t require any KYC. Bexplus provides a demo account with 10 BTC for traders to get familiar with leverage trading. Bexplus platform provides its users with a 100% bonus for every deposit, an affiliate program with up to 50% commission reward, and 24/7 customer support. The application is available on Apple App Store and Google Play.
