I have been a trader since 2013. In 2017, I started what has now become one of the largest crypto trading communities in The Netherlands: CryptoCoiners.
Many CryptoCoiners Community members will admit that learning how to trade is not difficult at all. I have made dozens of videos demonstrating how to trade crypto efficiently and successfully. The bottom line is that you don’t have to be a genius or a daredevil to be a profitable trader.
Good traders have both a strategy and a healthy attitude towards money. Also, they know how vital consistent results are and, most importantly, when to stop!
Let me share three essential Crypto Trading Hacks with you.
Hack 1: Aim for Consistency
Typically, a trade will end in a significant profit, a small profit, a slight loss, or a significant loss.
As you might expect, most aspiring traders hunt for those large profits, often taking significant losses as a necessary side-effect. As the saying goes, “no pain, no gain”…
With crypto trading, that saying couldn’t be further from the truth.
Firstly, it is almost impossible to be consistent if your balance keeps swinging from red to green and back! It is emotionally hard to deal with those significant losses. So before you know it, you find yourself in one or more “revenge trades,” desperately trying to get your losses back from the market – losing even more!
My philosophy about crypto trading is simple: the best trade is the trade you don’t lose. So my crypto trading style is defensive, not aggressive. Since I try to avoid losing trades, I’ll typically go after many “small wins” instead of a few “big wins.”
Of course, I lose some trades. But in general, my losses are minimal. The result: consistency. Combine that with compounding (your trading balance grows geometrically, allowing for substantially larger trades as time passes), and you’ll see where this can lead to.
And yes, this style of trading is boring at times. But you probably are not trading to get an adrenaline boost – you want to make profits!
Hack 2: Know when to take a loss
Trading involves taking risks. And taking losses is part of the game. One of the biggest mistakes you can make is refusing to bear a loss if you should!
Here is the golden rule: Before you enter a trade, decide how much you are prepared to lose. Set your stop loss accordingly and respect your decision.
Here comes the hard part. You are in a trade, your trade “goes south,” and you are about to reach the point where the stop loss will kick in. Your gut feeling tells you that the trade will turn in your favor soon and that it might be better to “sit this trade out.” So… you cancel the stop loss and decide to change your strategy for this trade.
This will seldom end well. In the end, you will lose much more than you would have if you had respected the stop-loss price. What’s worse: you have allowed your fear of loss to take control.
Fear and greed are two of the greatest enemies of a successful trade. This is one of the most important things that successful traders have learned.
Hack 3: See money for what it is
I learned this lesson from Anton Kreil, a former Goldman Sachs trader. In a nutshell: money has no opinion about you.
Money doesn’t care about beliefs you may have, such as “money doesn’t buy happiness,” “you have to work hard for money,” and “money is scarce.” Money doesn’t decide to whom it will flow. It is entirely objective about you – even if you haven’t had any luck with it in the past. The past does not equal the future when it comes to money!
To a professional trader, money has two key roles. You can use it to pay for things, as we all do, or use it as a tool to make more of it.
When I trade, money has a specific job: to help me make more of it. My trading strategy is the blueprint that guides me through the trade. Money is merely a tool to achieve the result.