How to effectively manage your risk while trading cryptocurrencies

How to effectively manage your risk while trading cryptocurrencies

By jordanjnr | Crypto Digest | 11 Dec 2019


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Ah yes.

Trading cryptocurrencies.

The fastest way to get that yellow lambo and sip some tropical from a coconut on a deserted island while your friends work their gruesome 9 to 5.

Crypto trading is a nice way to accumulate wealth(or to...you know....lose it).

And you should never step foot into apps like Binance or Bittrex if you have not properly learned technical analysis and how to trade cryptocurrencies.

But for everyone else who has learned, it's great to see some wins.

To be honest,I personally have a rush of dopamine whenever I see a double top forming with more green candles than red.

That said,it isn't impossible for you not to encounter losses.

In fact, over 70% of traders make losses almost every day.

And if you start trading cryptocurrencies,you WILL make loses.

So it's always a great idea to have risk management strategies.

The first one is using stop losses. 

I know that many 'gurus' say that stop losses are for losers.

But you never know how the market can go.

All your TA tools could be wrong at the same time,and it could cost you a lot of money.

So it's in you're best interest to always set stop losses,at least 5% away from your trading amount.

Also,know when to take your profits and run. 

It's cool to see green candles following each other in an uptrending market,but the volatility of crypto allows those candles to fall faster than a fat boy running barefoot on ice.

Always use indicators like the RSI to know when to take your pips and run.

Lastly never risk more than 2% of your portfolio.

I know that 2% sounds small to all ye risk takers.

But 2% of a $10000 dollar portfolio is a whole $200. That's some people's whole portfolio.

The market could plummet and you could lose all your hard earned pips if that happens.

Apply all these practices and more,and you'll begin to see more money left over in your account.

Thanks for reading.

This post was made possible by the tips of others. It gives me the drive to get up and publish beneficial content like this one. Consider leaving a tip below. Thanks.


 


jordanjnr
jordanjnr

Hello! I am a Blockchain enthusiast,bitcoin investor,CEO of BigTycoon group and I love crypto! Hit me up @TycoontechBlog on twitter!


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