Golden Rules of Cryptocurrency Trading.

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Rule 1)
Only invest the money that you are ready to lose:
It is common to see many investors taking loans to invest in cryptocurrency. This might work out for few, but not for everyone. And, you don’t want to go into debt. Not only that, even if you don’t take a loan for investing, always keep in mind that the money you put in is lost forever. Cryptocurrency is highly volatile, and your investment can anytime become zero.

Rule 2)
Diversification is the key to success:
The cryptocurrency market currently has 1500+ coins. If you plan your investment, you can gain the most out of the big market out there. By investing in one coin, you are taking unnecessary risk. It is always a good idea to have an investment in 4–5 coins so that you minimize risk as much as you can.

Rule 3)
Take profits at regular intervals:
You can easily find a coin doing 20–30% increase in a span of 2 or 3 hours. When this happens, it is common to see investors getting greedy and hoping that it goes more. By not taking out profits at regular intervals, you are doing the mistake of missing out on apparent profit. It doesn’t matter what your goal is; you need to take profits at regular interval. This habit can save you a lot of pain, later on, when the coin sees a correction, and you see yourself losing a lot of profit.

Rule 4)
Do proper research before investing:
There are many ICO’s and Ponzi schemes out there that only need your money. By doing some basic research and understanding the crypto-coin you are investing, you are just making sure that you are doing your best and also taking responsibility for your investment.

Rule 5)
Use stop-loss:
If you are into day trading, it is necessary for you to set stop-loss. Stop-loss can help you cut losses. Many coins are not good for long-term and hence should be traded with caution. Stop-loss gives you to the ability to automate a trigger when the coin is sold. This is a good strategy considering you cut your losses and want to move out of that coin to Bitcoin or USD.

Rule 6)
Never FOMO:
Fear of missing out is a popular term in trading. It is a human response when they see prices going up and don’t want to miss out on the chance to profit

Source : https://cryptodigestnews.com