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I made every mistake a crypto beginner could make. Here are the 10 valuable lessons I learned

Interpret Crypto

A full-time crypto-investor, trader, and low-cap gems hunter

Mar 3, 2023 at 03:11

I have learned to be greedy when the general sentiment is fearful, and vice versa

January was an incredibly good month for everyone in crypto. Everyone who stuck around through the incredibly cold crypto winter deserved to be reminded of how a bullish month feels. However, I do believe the current move to the downside was slightly overdue. Many people within the markets still have a bear market mentality, so when the market started to dip, fear was bound to enter the market pretty quickly. The Fear and Greed index was hitting the 60s, and the change in sentiment within just a month was crazy. I have learned to be greedy when the general sentiment is fearful and vice versa, so a dip has not come as a great surprise to me. We also have an incredibly strong level of resistance at $25,250 for Bitcoin, which is repeatedly rejecting us. My opinion is that if we manage to break through that level and use it as support, we could have a great couple of weeks. In the meantime, I’m looking out for supports and resistances and using this opportunity to swing trade, dollar cost averaging in and out at market highs and lows. 

Here’s my crypto portfolio

My portfolio size is not as large as the average crypto YouTuber’s, partly due to some mistakes I made during the last bull run (when I was a newbie). This means I can’t diversify as much as others, but I’m working on it! I won’t list them all, but here are a few. 

Bitcoin is my biggest holding, and I plan to keep it that way. Whenever I’m taking profits from an altcoin investment, I like to try and use a portion of that to build my Bitcoin holdings. 

Of the high-cap altcoins, my favorite two are DOTDOT is a cryptocurrency of the Polkadot blockchain network that allows cross-blockchain transfers (exchanging messages and performing transactions with each other) without a trusted third party. and LINKChainlink (LINK) is a cryptocurrency and technology platform that enables non-blockchain enterprises to securely connect with blockchain platforms..

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DOT has been one of my favorite projects for a while. I won’t go into too much detail about the project, as I’m sure your readers all know the key attributes it holds, but as of recent, I particularly like how the team has been committed to conforming to US regulations, aiming and seemingly accomplishing the challenge of transitioning from a security to a software. I believe this is something all projects should be taking a closer look at because regulators are attacking the space right now.

Any altcoin project that can get itself out of the firing line, either by becoming fully regulated or by positioning itself clearly outside of the security category, will have a much better chance of performing well in this bull run. 

I also have a few low-cap coins to add a little risk and excitement!

All you needed to do was close your eyes, press “buy,” and you’d wake up the next day with profits

This is how I became a crypto trader. 

Prior to graduation, others in my academic year were planning their next steps, but I’m not the best at forward planning; I prefer to focus on the task at hand and worry about all the other stuff later. So I graduated with no real plans for what to do next. I focused on software development in my degree and had a little experience in data analytics, so I knew I wanted something between the two. I had also blindly invested in Bitcoin and Cardano prior to this. The pandemic then arrived, and graduate jobs became few and far between. I started learning more and more about crypto, and it was like the lightbulb lit up above my head – when you get into crypto, it’s hard to ignore! During the pandemic, when tokens were flying, it was somewhat easy to make a living in crypto as a 20-something with few responsibilities; all you needed to do was close your eyes, press ‘buy,’ and you’d wake up the next day with profits. By the time the bear market came, I was too deep to leave the space. I’d begun some blockchain development jobs and was planning a career in the industry. 

My early mistakes and what they taught me

Honestly, I made every mistake in the book at the beginning. But I’ve learned from them all, and the results show. 

As a beginner, as every beginner does, I let my emotions get ahead of me. I’d say one of the biggest lessons I’ve learned is to find a trading strategy that suits me best. There are many strategies out there, we all have different strengths and therefore some will be more profitable using one trading strategy than others. I cannot stress enough how useful it can be to understand all the different trading strategies and typical trader psychological patterns, so you can analyze your own behaviors.

My favorite trading strategy is to DCA (dollar-cost averaging) in and out; this way, whichever way the market moves, I have a plan in place and I don’t begin to stress. With a small percentage of my portfolio, I enjoy leverage trading breakouts from time to time, but I’ve learned that having my DCA positions already scratches the itch to trade, so I don’t overtrade for the sake of it like I used to. 

One big lesson I’ve learned is to stop taking profits from one altcoin and investing them into another in a bull run. Doing that leaves you just as exposed to the market’s turns as if you had never taken profits in the first place. There will be drastic pullbacks that you will want to take advantage of. And maybe I’m being overly cautious this time around, but there are countless opportunities in crypto, and there will always be another pullback in which you will be thankful for keeping some stablecoins to the side ready to buy the dip.

Honestly, I’m proud of myself for sticking around during the last year or so. Whenever we are in a bull market, the idea of hanging around during a bear market seems so simple, and everyone that’s been in the space for years gets accused of being lucky. But bear markets are HARD. Being a part of a crypto company definitely takes the weight off a little.

10 valuable tips from my personal experience

  1. Find a trading strategy that plays to your strengths.
  2. Learn about the different psychological behaviors of traders so you can understand your emotions in the market.
  3. Switch your mentality; be greedy when others are fearful, and fearful when others are greedy.
  4. Don’t be afraid to sit on the sidelines for a while. Having some stablecoins isn’t the worst thing in the world, and you’ll feel like a genius if the market dips.
  5. Don’t give up when times are hard, and if the bear market gets too tough, try and find some peers in the field. The bear markets literally feel like you’re standing in the middle of the desert watching the tumbleweed fly past at times. 
  6. Read the news daily, there’s never a dull day in the world of crypto, so it tends to be pretty interesting. At the beginning, it will probably raise more questions than answers, but eventually you can fit all the puzzle pieces together and understand how the markets react to different stories. 
  7. Accept that you’ll probably make some mistakes. When I first got into crypto, I was like a kid in a candy store, I thought I was hardworking enough that I’d be able to crack the code the first time and become a profitable trader within a few months. Trading and investing isn’t an easy skill to learn, otherwise everyone would be doing it. Accept that you’ll make mistakes and make sure you learn from them! If you don’t learn from your mistakes, this isn’t the industry for you. The markets are harsh.
  8. Don’t trade for the sake of trading; you’ll most likely get burnt. If the setup isn’t quite how you’d like it to be, wait for the next one. The biggest mistake you can make is letting FOMO take over. It’s so easy to think you’ll miss your chance, but there are endless opportunities in crypto. Don’t stress if you missed one, just look for the next one. 
  9. Get yourself involved with the community. Crypto Twitter may host many spiteful and hateful users, but it’s so important to listen to other people’s opinions. Isolating yourself on your own trail of thought can lead you down a rabbit hole. Sometimes it’s good to see other people’s opinions and try to understand why they hold them. You may think some of them are idiots, but at least you’ve understood and solidified your reasons to think the opposite.
  10. Don’t trade against a pattern unless it proves to have failed; the trend is your friend until the end!

Watch my YouTube channel every day, obviously!

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