8 practical tips for trading virtual currencies you must know

By parismexi | BigoMex Trading | 19 Nov 2021


For virtual currency transactions, interest and making money are two different things. Coin trading is technical and scientific. This is why coin trading is full of charm. If you are a novice investor, the following content will be of great help to you. If you are an investment veteran, you can also learn from each other and make yourself more comfortable in currency trading. Let's take a look at what are the 8 practical coin trading tips you must know?

  1. Learn to establish a position in a coin account, stop loss and liquidation and profit closing

"Establishing a position" means opening a market, also called exposure, that is, buying one currency while selling another currency. After the market opens, the currency that is bought is called a long position, and the currency that is sold is called a short position. Choosing an appropriate exchange rate and timing to establish a position is a prerequisite for profitability. If the time to enter the market is good, the chance of profit is greater; on the contrary, if the time to enter the market is not appropriate, losses are prone to occur.

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"Stop-loss liquidation" is a stop-loss measure taken to prevent excessive losses when the exchange rate of the currency held by the currency falls after the position is established (that is, when the currency depreciates).

The timing of "profit" is more difficult to grasp. After establishing a position, when the exchange rate has developed in a direction that is beneficial to you, you can make a profit by closing the position.

  1. The principle of buying up and not buying down

The principle of coin trading is exactly the same as that of stock trading. Because in the process of price rise, it is wrong to buy up only when the price rises to the apex. In addition to this point, any other point of buying is correct.

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When buying when the exchange rate drops, only one thing is right, that is, when the exchange rate has fallen to the lowest point. In addition, other points are wrong to buy.

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Therefore, the chance of buying a profit when the price is rising is much greater than the chance of buying when the price is falling.

  1. The principle of "pyramid" overweight

"Pyramid" overweight means: After buying a certain currency for the first time, the currency exchange rate rises. If you want to increase your investment, you should follow the principle of "the number of overweights each time is less than the last time." In this way, the number of incremental purchases will become less and less, just like: "pyramid". Because the higher the price, the greater the possibility of approaching the peak of the rise, and the greater the danger. At the same time, buying when it rises will cause the average cost of the bulls to increase, thereby reducing the rate of return.

  1. The principle of buying (selling) when rumored and selling (buying) when facts

The foreign exchange market, like the stock market, often circulates some gossip and even rumors. Some news proves to be true after the fact, and some news proves to be nothing more than a rumor, or even a trap set by someone deliberately. At this time, traders must pay attention to buying immediately when they hear good news, and once the news is confirmed, they will immediately take profits out of the position. The reverse is also true. When bad news comes out, immediately sell, and once the news is confirmed, immediately buy back. If the transaction is not fast enough, it is likely to incur losses due to market changes, or miss profit opportunities.

Five, do not increase the principle of losing money

After buying or selling a coin, some people will want to increase the size and do it again when they encounter a sudden change in the market, such as the reverse, which is very dangerous.

  1. Do not participate in uncertain market activities

When you feel that the currency market is not clear enough and you lack confidence, it is better not to enter the market. Otherwise, it is easy to make wrong judgments.

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Seven, don't pursue integer points

In coin trading, sometimes mistakes are made to fight for a few points. Some people set a profit goal for themselves after establishing a position, such as earning 100 USTD, and they are always waiting for this moment in their hearts. Sometimes the price is close to the target, and the opportunity is good, but it is still a few points before it is in place. It could have closed the position to collect money, but due to the original target, I missed the best price while waiting and missed the opportunity.

  1. Establish a position when the market breaks through

The market refers to a bull market, and the exchange rate volatility is narrow. In the game, buyers and sellers are evenly matched, and they are temporarily in balance. Regardless of whether it is an upward or downward transaction, once the transaction is over, the market price will break the barrier and move up or down, showing a breakthrough. This is a great time to enter the market to establish a position. If the market is in a long-term bull market, the position established when breaking through the market has a greater chance of making big profits.

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parismexi
parismexi

Cryptocurrency enthusiast and holder. Bitcoin to the moon.


BigoMex Trading
BigoMex Trading

Trading Bitcoin and other large cryptocurrencies using the BigoMex platform.

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