1. Never be emotional – especially afraid
It’s easy to come in with mentality that it’s exciting to make money, because it is. However, trading has to be looked at with a cold and calculating eye. Don’t let the ups get you excited, or the downs get you depressed. People with a loser’s mentality trade with emotion. When the coin is down, just start slowly buying. When it’s up just start slowly selling (more on this later). If you allow fear to come into the trading process – fear of missing out, or fear of selling too soon / too late, you will never be an effective trader.
2. Always be prepared
Know your market, read the ANN thread of the coin you’re buying. Know the development team, their past, their scam accusations. Know the total amount of the coin in circulation and the inflation rate. Know how many coins the top holders have. Plan on coin accumulation over time – even when a coin can seem at its bottom, there’s always a chance scared people will push it 20% lower before there’s someone to pick up the pieces
3. Never put all your eggs in one basket
This should be obvious to everyone, but never champion a specific coin. “believing in a community” is the single most ridiculous thing that the altcoin traders have come up with. The dogecoin community was massive and actually got a nascar sponsorship through, but the excitement of the past doge days is long gone. My point here is that no community sticks around for too long, because there’s nothing to actually lock anyone in after big traders have abandoned the coin.
4. Always be logical
The same as never be emotional, stated in the positive. It is important enough to restate, because it is the single most critical, and common, mistake that traders make. The herd moves with what “seems” correct. Buy when a coin is going up. However, you should be selling when the coin is going up. That is the time to take profit – when everyone else is trading with emotional excitement, thinking only of their greed. It’s easy to take advantage of if you know what to look for
5.Never sell all your coins at once
Space your trades out – pumps can start and stop at any time, and any price level.
Even if you “know” it’s at the top, it can always go higher. Don’t live with that regret.