Crypto investing is a psychological warfare and the enemy is yourself. Stock market traders often say that investing in the traditional markets require extreme mental discipline More of the same is needed in the crypto market. How do you discipline yourself in such an extremely volatile market? How do you stop yourself from making a stupid decision and how do you remain disciplined to your strategy?
If you needed a little bit of discipline in traditional trading, then you will need the mental fortitude of a Jedi in the crypto market. No market has exhibited more volatile characteristic than the crypto market. Your emotions will be put on a roller coaster and pushed to extreme limits.
And if you forget everything you read in this article, remember to keep your emotions out of this. The market is sentimental and price movement is driven by emotion. So try as much as you can to remove emotion out of trading.
You know, it’s not always about what you do but what you don’t do. What you are refraining from when exhibiting mental fortitude. Watching bitcoin go don has not been easy for many holders. It’s hard to remain calm during these times and you might wonder if it will ever come back up again. But history has shown that bitcoin always comes back, stronger than it was and always threatening to reach new ATH.
Don’t Catch the Exact Bottom
The best time to construct a portfolio is when the markets has taken a dip. But be careful, it can be an obsession catching the bottom most downtrend and often, investors have lost on some obvious wins.
Catching the bottom and trying to enter the trade at the bottom of the dip is like catching a falling knife. Staring as the price plummets and wondering when it will stop can be extremely difficult. Many have tried and missed out on great opportunities to trade, far more than gained. So, the best advice that you’d get is: just do it, enter near the bottom, or wherever, you can’t be perfect.
Don’t Sell for the Ones That Are Going Up
It’s never a wise idea. Many have done it. Only for them to see the coin they have abandoned reverse and shoot upwards. What a shame.
Don’t be in a hurry to react to the fear of missing out (FOMO). It has resulted in terrible decisions in trading.
Don’t Stare at the Charts All Day
Mind tricks won’t work here i.e. if they have worked for you elsewhere. They never work. Keep your mind distracted elsewhere. This is the time people make lots of mistakes. It can make you more emotional and could cause an overtrading.
Set a limit order and walk away, but and remember, trading with no strategy is gambling