Crypto For Noobs #2: "When To Sell?"
In part two of this series I will address one of the most common questions that people ask in the crypto world. That is of course "WHEN TO SELL?"
If your are new to cryptocurrency, things may seem very chaotic right now. The market is swinging up and down with some serious volatility almost on a daily basis now. We have seen the most amazing highs and crushing lows in just the past 7 months. Where will this market bottom out and when will it come back up?! These are all things I will cover today in this installment of Crypto For Noobs.
As always, when to sell is entirely dependent on your individual situation and portfolio. Obviously the goal is always to buy low and sell high, but it isn't always that simple.
If you were into crypto before the massive hype at the end of last year then you were able to see Bitcoin go for prices as low as a few hundred dollars a piece up to a few thousand. And then out of nowhere it was like BOOM! Everyone wanted to get in on it... the price went skyrocketing to ridiculous highs of $20,000 each!
If you didn't take any profits at that point then you got to experience the massive rollercoaster of a ride of emotions that ensued for crypto holders.
Bitcoin saw a decline of over 70% since December 2017's highs and has since only recovered a small piece of that loss to around $6,500 today. Many say that we have not yet reached the bottom but only time will tell. Overall the sentiment is mixed right now, with the general public being somewhat frustrated and bored. Industry insiders know that the market is just setting up for a much larger move in the near future. This stuff isn't going anywhere and certainly isn't going to stop: just strap in for the wild ride!
This brings me back to my original idea for this post and that is when you should click that dreaded red sell button.
1) Decide what kind of profit/losses you are willing to take BEFORE you even buy. Many people enter a trade without any sort of plan or idea of when they are going to sell to take profits or limit losses. This really should be the first thing you plan before you make any significant trade since it really eliminates the guesswork out of when to sell.
2) You want to figure out the best exchange to make this trade now. Certain exchanges charge more for their withdrawal fees and trading fees so make sure you do your homework on these numbers before you get too deep into a large trade. For example: I prefer to use GDAX for larger orders so I don't have to pay a trading fee by setting a limit order, rather than a market order (like Coinbase would perform). Also make sure the exchange you are trading on has enough liquidity in the market you will be trading- especially important with smaller altcoins or exchanges that can experience some serious slippage.
3) DON'T PANIC SELL! I REPEAT DO NOT PANIC SELL! All too often I hear people selling out of fear. If you don't have a plan before buying then you are just a sitting duck for the more experienced traders. These markets are still very immature and will have volatility unlike anything else you may have seen. This presents fantastic buying AND selling opportunities- there is always a dollar to be made.
4) Use trading tools and learn technical analysis so you can feel more comfortable before making any large sell orders. If you have no idea how to read a chart then it will make it pretty difficult to decide when is a good time to enter or exit the market. You might end up making decisions purely based on emotions and that can severely affect your bottom line and mental health. There are plenty of people to learn technical analysis from now online- all of the information is available at your fingertips and much of it for free too.
Using these tips you should be able to make a more informed decision next time you need to sell part of your portfolio. Eventually buyer demand for most cryptocurrencies will increase again along with their prices. It's just a waiting game now!
Don't be a NOOB! Check out part one HERE
*Never invest more than you are willing to lose and always do your own research before making any investment decisions. I am NOT a financial advisor and this is NOT financial advice- this material is intended for entertainment and informational purposes only. Hit "CTRL + or CTRL -" to change size of chart.
(All pictures are free domain images and/or created by myself with the help of Snappygoat.com, Coinmarketcap.com and Coinigy.com.)
Check Out My Last Bitcoin Post:
https://steemit.com/bitcoin/@hotsauceislethal/bitcoin-price-mini-t-a-6-15-2018
Feeling Salty About Missing The Crypto Boat?
https://steemit.com/bitcoin/@hotsauceislethal/how-to-conquer-fomo-fear-of-missing-out
Fantastic Documentary About Relevant STUFF! (MUST WATCH!!!)
https://steemit.com/cryptocurrency/@avii/mind-over-money-documentary
Like Bitcoin But Want To Avoid The Fees?
https://steemit.com/bitcoin/@hotsauceislethal/save-money-when-sending-crypto
Pay No Transaction Fee From Coinbase!!!
https://steemit.com/bitcoin/@hotsauceislethal/no-transaction-fee-bitcoin-trick-using-coinbase
Need A Good Laugh?
https://steemit.com/bitcoin/@hotsauceislethal/what-kind-of-crypto-trader-are-you
Keep A Strong Hand!
https://steemit.com/bitcoin/@hotsauceislethal/bitcoin-s-increasing-dominance-and-shrinking-market-cap
I never actually think about selling, i just will use the crypto for daily transactions in the future. I only sell the coins I have lost faith in, and exchange it to other coins, but never sell it into fiat
Interesting! I sold many of my alts for Bitcoin but I had to cash some of that out to fund my vacations this year.
wow, that might be the most expensive holiday after the next bull run
Nice one Hot Sauce, good advice! Learn TA everyone! It can be profoundly useful!
It has certainly helped me to make very profitable trades in the past and also get out of trades that I would have otherwise lost money on.
Upvoted !!