Successful crypto traders in 2018 are rare. Last year anyone could open a Coinbase and buy any of the three main coins on the market and instantly be making money. This year reality has set in. You actually need a defined trading system and rules to make you money. There is still a lot of money to be made in the markets, but you have to be skilled and disciplined. Here are 5 traits that all successful crypto traders have:
The cryptocurrency markets are 24/7. This means that at literally any time of the day the market could make a move. It’s easy to let crypto trading consume your whole life, as you constantly check the markets to make sure your positions are intact. In order to become a successful crypto trader, you must learn to maintain a healthy balance between trading and your personal life. To prevent yourself from becoming a slave to the market, you must be trading small enough size on your trades that you are not emotionally attached to them.
It is difficult to draw your attention away from the markets when you are trading a large portion of your net worth. When you trade money you cannot afford to lose, you cannot afford to bring your attention away from the markets. You cannot go 5 minutes without checking your phone to check on your positions. Trade and invest with small enough positions so that you can divert your attention away from the markets for extended periods of time, so your life is not consumed by the crypto markets. This is how you maintain a healthy balance between trading and your personal life.
Because crypto markets are open all the time, big market moves take time to move and setup. A lot of the time there will be no obvious trades, and the best option is to stay in cash. Losing crypto traders often overtrade because there are so many cryptos moving on any given day. They possess no patience. You have to define your edge in the markets so that you know what setups you need to wait for that will make you money.
All mediocre setups that have bad risk vs reward and low probability of success should be avoided. Becoming a profitable crypto trader is actually more knowing when not to trade versus actually trading. An example of the type of A+ setup you need to be waiting for is the XRP trade that we took around a month ago during its monster run-up. Check out the full trade recap here.
Trading opportunities wait for no one. You have no idea when and where they will appear. Whenever they appear, you have to be ready with your trading plan. You must know what your A+ setups look like, otherwise you will not be decisive with entering and exiting your positions. Losing traders are not decisive, and lose because they gamble and do not have the training needed to become consistently profitable.
Decisiveness comes from competence and understand of what a high quality trading opportunity looks like. Sometimes the right price to buy or short is only available for a matter of seconds. The market waits for no one. The only way to be decisive enough in the markets to make money consistently is through careful planning and extensive market analysis. Hoping is not a trading strategy.
So many crypto traders have been humbled this year. Everyone thought they were on top of the world last year, as everything you would buy would instantly shoot up. The smart and humble traders realized that this kind of market move was not sustainable and sold when everything looked great. The dumb money chased and bought the top thinking we were heading to the moon. Being humble allows you to view market objectively, and not allow your ego to get in the way of your ability to make the correct trading decision.
This is very cliche, but nonetheless true. Without passion you will never be able to become a successful trader. You will not be able to put in the long hours to study and analyze your data if you are not passionate about cryptocurrency trading and blockchain technology. The hard work needed to be put in to consistently extract income from the crypto markets is derived through passion. Making a living from cryptocurrency trading is the dream lifestyle. But it does not come unless you put in the long hours of hard work and study. Nothing worthwhile in life comes without a lot of hard work. If something so rewarding was easy, everyone would do it.