Cryptocurrency Trading 101: Lessons from my Portfolio

Hello All. Here I would like to share my journey on Cryptocurrency Trading in the hopes that those interested may be able to learn a few things from it. I have come across numerous threads with people asking questions about trading cryptos, etc so I am hoping my successes, failures and lessons may be beneficial to all.

I have traded various types of securities in the past - stocks, futures, options and I will be trading cryptos applying these same principles. My method is strictly technical and chart-based. I do not use indicators or news or any of that. I just read the charts and do what it tells me to do. That's my principle on trading.

STARTING CAPITAL: 0.0171BTC ($100)
TRADING STYLE: Technical Analysis, Chart reading, Trading Volume and Momentum
TOOLS: Laptop, Mobile Phone (to check prices on the go), tradingview.com (most detailed free resource online for checking financial market data)

Well that's it. Enjoy the Journey and feel free to ask any questions you may have.

Good luck mate. Subscribing to this thread.

Looking forward to the journey.

I am beginning my trading journey in BTC derivatives. For those not familiar with derivatives, derivatives are pretty much a way of buying BTC or any financial security (stocks, bonds, etc) for a fraction of the cost thereby maximizing your profit potential and also maximizing your loss potential. for example instead of purchasing 1 BTC at $6000, I may be able to buy a derivative that lets me pay $60 for it. If BTC then jumps up by $60, i get a 100% returns on my money. If it it goes down by $60, I lose all I invested.

Its a game of risks but this is the tough route I choose to follow a man who doesnt take risks can never see whats on the other side of his comfort zone.

So I purchased derivatives of BTC at $6018 and I paid approximately $100. I believe the market is in an uptrend and will soon be on a sharp rise.

michaeladewale2010 said:

I am beginning my trading journey in BTC derivatives. For those not familiar with derivatives, derivatives are pretty much a way of buying BTC or any financial security (stocks, bonds, etc) for a fraction of the cost thereby maximizing your profit potential and also maximizing your loss potential. for example instead of purchasing 1 BTC at $6000, I may be able to buy a derivative that lets me pay $60 for it. If BTC then jumps up by $60, i get a 100% returns on my money. If it it goes down by $60, I lose all I invested.

Its a game of risks but this is the tough route I choose to follow a man who doesnt take risks can never see whats on the other side of his comfort zone.

So I purchased derivatives of BTC at $6018 and I paid approximately $100. I believe the market is in an uptrend and will soon be on a sharp rise.

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I've been wondering about derivatives in crypto because if I were to jump on Crypto that is how I would do that.

Can you share how you are doing that (broker/website)?

BassTrackerBoats said:

I've been wondering about derivatives in crypto because if I were to jump on Crypto that is how I would do that.

Can you share how you are doing that (broker/website)?

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i use bitmex.com for derivatives. they have options in BTC, ETH, XRP and some other coins. not more than 10 of them but they all work differently. the derivatives are quite complicated so make sure you read on the one that you are interested in thoroughly. they have excellent guides on each one and a group chat where mods chat as well with other traders. XBTUSD has upto 100x leverage but make sure you understand there are fees attached. the more money you make the more they charge you. you will still make loads of profit if you catch a good rise though. they call this charge the funding charge.

michaeladewale2010 said:

i use bitmex.com for derivatives. they have options in BTC, ETH, XRP and some other coins. not more than 10 of them but they all work differently. the derivatives are quite complicated so make sure you read on the one that you are interested in thoroughly. they have excellent guides on each one and a group chat where mods chat as well with other traders. XBTUSD has upto 100x leverage but make sure you understand there are fees attached. the more money you make the more they charge you. you will still make loads of profit if you catch a good rise though. they call this charge the funding charge.

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I've traded using derivatives as well as options in the past so I'm comfortable in that world. I'm sure there are nuances in crypto that would cause me to make some adjustments but, to me, that is the way to take advantage of a semi-volitale market.

Thanks for that!

michaeladewale2010 said:

I am beginning my trading journey in BTC derivatives. For those not familiar with derivatives, derivatives are pretty much a way of buying BTC or any financial security (stocks, bonds, etc) for a fraction of the cost thereby maximizing your profit potential and also maximizing your loss potential. for example instead of purchasing 1 BTC at $6000, I may be able to buy a derivative that lets me pay $60 for it. If BTC then jumps up by $60, i get a 100% returns on my money. If it it goes down by $60, I lose all I invested.

Its a game of risks but this is the tough route I choose to follow a man who doesnt take risks can never see whats on the other side of his comfort zone.

So I purchased derivatives of BTC at $6018 and I paid approximately $100. I believe the market is in an uptrend and will soon be on a sharp rise.

Click to expand...

from your explanation i can take conclusion thats leverage trading/margin trading , actually i dont really knows what derivatives is but, when read at this article http://www.investinganswers.com/financial-dictionary/optionsderivatives/derivative-2202 i think its clearly very different than your explanation

BassTrackerBoats said:

I've been wondering about derivatives in crypto because if I were to jump on Crypto that is how I would do that.

Can you share how you are doing that (broker/website)?

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it might be that you want to look ?? https://www.dailyforex.com/forex-brokers/bitcoin-brokers or http://www.bitcointradingsites.net/features/leverage/

BassTrackerBoats said:

I've traded using derivatives as well as options in the past so I'm comfortable in that world. I'm sure there are nuances in crypto that would cause me to make some adjustments but, to me, that is the way to take advantage of a semi-volitale market.

Thanks for that!

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you are welcome. glad to know you are familair in this space. most people arent so i tend to explain myself a little more than is necessary. thanks for the feedback. let me know what you think about the platform or if you come across any others.

TechnoBridge said:

from your explanation i can take conclusion thats leverage trading/margin trading , actually i dont really knows what derivatives is but, when read at this article http://www.investinganswers.com/financial-dictionary/optionsderivatives/derivative-2202 i think its clearly very different than your explanation/

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thanks for the links. very valuable. no i am not refering to margin/leverage trading as you might be thinking. i mean derivatives. if you want to get technical about derivatives yes that definition in your link hits it right in the head. my explanation was simplified so most people reading this may understand. simply stating that you pay a fraction of the cost for a commodity is simpler to understand than saying you are paying for a new security that derives its value from an underlying asset.

End of Day1. I have 25% ROI on my portfolio.

BTC is going through a consolidation phase (meaning there are lots of buys and sells at the same price range). at some point one of these people should exhaust all their resources. if the buyers exhaust all their money then the price of BTC is going down. if sellers exhaust all their coins then the price is going up. we can only sit down and wait. my estimate is that the buyers will win this battle because of how quickly they accumulated coins passing the $6000 mark. it's a sign of very rich investors paying for the coin.

but again in trading, its not about being right. its about protecting your money. so just incase i am wrong, i have set orders to sell immediately if the price goes lower than my perceived threshold.

Man, I have 0 knowledge of this derivatives but sth telling me you will be very good at this and finally pull out a lot lol at least I think so, btw will you reject people who want to put money on your hand and let you manage it? That would be awesome for tech idiot like me lol.

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lol thanks for the compliment. unfortunately, i am not accepting external funds for management at this time. maybe in the future.

100$ you should have invested 10 years ago

What site would you suggest me to use if I were to trade only BTC and not derivates?

W9go said:

100$ you should have invested 10 years ago

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There’s still plenty of time

Prototype40 said:

What site would you suggest me to use if I were to trade only BTC and not derivates?

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Local bitcoins is good site to buy and sell bitcoin.

Day 3
--------
On my last post i mentioned that BTC was in a consolidation phase and was most likely to have a sharp upward or downward shoot in prices. I believed the prices are going up and still do but i set a trigger to sell if it hit a certain price level below $5800. Unfortunately that price was hit yesterday and I was forced to sell losing 65% of my capital

so now i am back to speculating where next i believe the prices would go so i culd get back in the game.

CURRENT CAPITAL: 0.0058 BTC ($35)
PROFIT / LOSS FROM STARTING CAPITAL: -65%


LESSONS LEARNED
-----------------------------
1. Have a respectful fear of the market. The truth is on saturday i was up 25% (see previous post with screenshot) I saw the signs on the chart that there was a massive selloff. My gut told me to sell but I refused because my emotions told me the price was still going up. My emotions were wrong and before I knew it I found the price coming down faster than I could imagine. Next time I hope to listen to my gut. It is better to take a 25% profit and re-enter when I do not see any reason to fear; than to hope that a 25% profit will become 50% even though all the signs are showing otherwise.

2. Buying at the right time makes it easier for you to hold your position. I think I entered this position a little bit higher than I had planned. that caused me to lower the leverage I had when the price went down. If I entered the position early enough, I would have had more leverage to sit tight while the price kept declining. This is VERY important. Many traders state this fact but its always hitting home when it happens to you.

W9go said:

100$ you should have invested 10 years ago

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a wise man once told me 'the best time to begin investing was 10 years ago. the 2nd best time is now'. relishing on the past does nothing for anyone. what you do now determines what your tomorrow becomes.

Prototype40 said:

What site would you suggest me to use if I were to trade only BTC and not derivates?

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there are numerous BTC sites. truth is I never realy traded just BTC but many names that come up in groups I'm in are POLONIEX (for many cryptocurrencies and they offer leverage but ive also heard people complain and funds withdrawal). another reputable exchange i hear of is BITTREX. mostly hear good things about them.

Good luck

@op, can I start with something small, like 10$ or 20$?

ShehuAB said:

@op, can I start with something small, like 10$ or 20$?

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Yes you can.

Thanks. So If understand you well, if I put 20$ for btc at 5700, and it appreciates to 5720, my gain will be 20$, 100%. Please forgive my stupid question, I am new to this.

And do help me with links, if any, to learn of trading derivates, in a simple way. Thanks.

Trading $100, jeez. Might wanna get more capital lol

crypto currency is all new for me. I am planning to invest $100 in trading too for last week as friend of mine said after fork I can see good increase in prices.