A person without experience may find it difficult to navigate through the cryptocurrency exchanges and choose the appropriate one. To make an informed choice, you should pay attention to the following parameters:
- Daily trading volume . High turnover of an exchange is a sign of its popularity. The higher volume of trade, the greater chances to earn, trading here.
- Deposit and withdrawal of funds. Find out in advance on what conditions, how quickly and in what currency you can deposit and withdraw funds, and what payment systems this exchange works with.
- Cryptocurrency pairs. A wide choice of pairs means a wide range of opportunities to earn money. Although it is more important for beginning traders to have the most popular and liquid cryptocurrencies.
- Verification. Do you need to prove your identity to trade on this exchange, or can you work anonymously? Are there any restrictions on daily turnover for non-verified users?
Top 7 cryptocurrency trading rules
Don’t gamble on your last. Invest only those funds that you are willing to lose without too much trouble for your budget. Playing on an exchange, including a cryptocurrency exchange, is not a bank deposit. There is always a certain amount of risk, especially if you are a novice trader. Be morally prepared to lose everything you have invested.
Don’t let greed make your decisions for you. It can be very difficult to take profit when you are a beginner, because it always seems that you could earn more. But it’s better to take profits out and make a new run than to wait and incur losses.
“Trust, but verify.” What is written in the exchange chat should be subjected to no less careful analysis than the situation in the cryptocurrency market. There are many people who are ready to promote a certain currency by any means – not out of altruism, but for personal enrichment.
Analyze. Not all cryptocurrencies are the same – some are more stable, some are less stable, and some are questionable. Stable cryptocurrencies are good for medium- and long-term investments, but with “dark horses” you can take a risk on short-term distances. The main thing is not to keep all your eggs in one basket.
Buy cryptocurrency when it falls and sell when it rises. This way you will get ahead of the crowd who mindlessly follow trends.
Don’t try to catch the low and the high. It’s too risky game, especially for a beginner. Even stock market sharks can’t always correctly gauge market sentiment.
“Trust your memory, but make no mistake”: Strategies and orders should always be written down. This will help you calculate the average purchase price in the future and create your own strategy for each trading phase.
A cryptocurrency exchange, like any other exchange, is not a casino. No matter what trader’s mythology says, experience, knowledge and analytical skills mean much more than luck. So if you are seriously interested in cryptocurrency, first of all invest in your education, understand how this market works, learn all about types of cryptocurrencies and strategies and play with full understanding of what you are doing.