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10 Things for Successful Crypto Trading in 2020

2020 Is knocking on the door, and fro us, traders, it means only one thing - time to review the strategy!

Many seasoned traders have a simple rule which helps them stay profitable over extended periods of time and regardless of the market conditions. The rule is simple - you should have a periodic review of your performance, and the best interval is one Quarter of a full year.

Thus, to help you guys stay in shape - we’ve prepared a list of the 10 hottest trading rules that will be popular among top-level traders in 2020.

1. You are the mistake

The market is always right. If the market doesn’t behave the way you thought it would, then you’re wrong. Always and forever. Amen.

2. Beginners lose at trading because they:

  • bet too much money
  • trade without knowledge, so they’re basically playing the lottery
  • hold positions for too long
  • trade with cheap shitcoins
  • gamble with other people’s money
  • never cash out their winnings
  • trade too often, therefore also trying out mediocre trades

3. Less technical analysis (TA) is more

Learn about: Moving averages, stochastic RSI, trend lines, the basics of the Candle Sticks, upwards & downwards channels, bull flags, breakouts and wedges. You can “zoom” TA, you can form them from daily, hourly or minutely values. The shorter the timeframe, the more error-prone the pattern. Don’t search in minutes what you cannot discover in hours.

4. The 80/20 rule of trading

The good traders make their money with 20% of their trades. The rest is either a tie or a loss. If a good trade brings a profit of 16%, then a bad one may bring an average loss of 4%. You can reach this relationship with a stop-loss. In this way, you can also calculate whether you make a net profit. And you see that trade with 3% profit isn’t really a win.

5. 50 plus 1

Once again the seesaw. There are only two relevant states a course can have: rising or falling. It’s a matter of 50:50. If we let a monkey trade, then the probability of it being right is exactly 50%. Nobody is 100% right. There is no system that can always predict an irrational and repeatedly manipulated market correctly. The goal of every trader is to be right at least 51% of the time. Every trader needs a frustration tolerance for losing money in 49 out of 100 trades.

6. Trading is war

In organised battles between nations, there is the term “fog of war”. The general can’t see the entire battlefield but only what’s in front of him. He has to make decisions with incomplete information. It’s the same with trading. Some traders are always on the wrong side of the asymmetry. There are so-called whales — they own so much crypto that they can strongly affect the course with a trade. However, only the whale knows when he will make the trade. If a (real or fake) message drives the price, then we usually find out about it too late. The winners in trading are those that have significant information before the others do.

7. There is no win-win situation

Think back to the seesaw on the schoolyard. Two children rock up and down. There are two states. Either one child is up and the other is down. Or they balance themselves in the middle under a lot of strain. That’s how trading works. Sometimes nothing happens and the courses balance in the middle under a lot of strain. However, every time a trader makes a profit, a different trader takes a loss. The seesaw cannot be up on both sides. Simple physics. The question is: Why do you think you’re better than your counterpart?

8. Use a stop-loss

We cannot emphasise the importance of a stop-loss. Not setting a stop-loss technically gives you an excuse to keep a lousy position open ( hoping that things will get better). We all know, in the crypto markets, bad situations rarely improve.

A correctly placed stop-loss helps you cut losses and eliminates the risk of losing all your trading balance on a single bad trade.

9. Take  profits at a regular interval

Since the crypto market is highly volatile, it’s common to see a coin gaining 20–30% in just a few hours. In such cases, investors may get greedy and hope the rise continues. Unfortunately,  by failing to redeem profits at regular intervals, they miss out on quick gains.

Whatever your trading goal is, greed never wins. To be successful in the long run, you need to take profits at a regular interval. You never know when the trading asset will retrace and take back all the floating profits you left in the market.

Final tip

Successful crypto trading is not a gamble; it’s a strategic game. You need to calculate every move before you execute it. Make a trading plan and trade your plan.

Now that you know the golden rules of crypto trading, do you have any tip that has worked for you in the past that you wish to share with other traders? Make sure to share it in our Telegram Chat, and follow us on Twitter & Facebook!