How to Make Money Trading - A Basic Introduction

Recently I've been doing a lot of crypto trading. This is almost a revelation to me, as when I first got into Forex, crypto trading was in it's infancy, at least to the degree the exchanges are now. I remember thinking how much I wished I could trade crypto like I traded forex. Perhaps I would have been Mr Goxxed if I had gotten into it though. Now, I'm regularly making profit on crypto trading. If anything, it's easier than forex, at least for me. Forex is a huge fucking stress. For some reason, with crypto, it's just numbers. It's a little stressful when it falls, especially when it falls a lot, but not as much as Forex was.

I dunno if it's the fact that it's disconnected from all the associations we have with money, or that it's not traded on a margin, but it just seems less stressful.

So I thought I'd help others get their foot in the door a bit, and get started. Yeah, there are probably a fuck ton of other guides, but fuck man. I haven't seen a guide I can link anyone too and have them get a grasp. It's all about bear bull balls and shit. I don't plan on this being the perfect guide either, but if it helps one person, that's good enough.

So, lets get started. How do you trade?

Buy low sell high.

Done.

Shit, not enough? Damn.

Buy when it's the lowest it's going to get, and then sell when it's the highest it's gonna get for a while.

Still not enough? Damn!

This actually isn't even true.

Well, in general it does boil down to buying low, and selling higher, but it's more complicated than that. You can't magically come up with the exact number that the market is going to be at it's lowest or highest. Maybe with an advanced AI you might be able to get a number closer, but trading is basically statistical gambling. If you know the odds, and what to look for, it's not gambling. You watch the market, and look for signs of when to buy in, and when to take profit. But you still don't go all in the instant you see something, usually. You buy in a little bit, and then when you're sure, you buy in more. Then when you're really sure, you buy in more still. Then you slowly sell off, at resistance points, and signs that it might be slowing down or reversing. Occasionally you even buy in a bit more at certain reversals.

Trading actually isn't really that complicated. It just takes a bit of study, and stilling your heart against the flutter from the market's dance.

Basically, "you gotta know when to hold 'em, know when to fold them, know when to walk away, and know when to run!"

There are also a lot of different styles and techniques in trading. There is no one right way. There are plenty of wrong ways though.

So, lets go into some basics. I only have a plan to cover the very basics. You should research yourself how to trade, even if you don't plan on doing any trading. You should know enough to at least know when might be a possible good time to sell in the immediate future, since steemit does pay you in crypto-coin.

I don't want to give you trading advice, as far as what to buy or not buy, just give you a little bit of an introduction to trading, so you have a slightly lower chance of losing your shit. You are responsible for your own monetary decisions. Don't blame me when you lose your shit. I already told you that you need to do a lot more research than I'm gonna cover here.

So, lets get started!

Candlesticks

Candlesticks are one way to view a price chart, such as you might get from stocks, or forex, or crypto. They have four aspects, the opening price, the closing price, the high, and the low. The main block of the candle consists of the opening and closing price. The wick coming out the top and/or bottom represents the high and low for the designated period of time.

_{Scheme of a basic candlestick chart such as used in Japanese trading.
Image used under Creative Commons Attribution-Share Alike 3.0 Unported license. (source)}

Above you can see a Japanese candlestick, which is where candlestick charts originated. They may be displayed as either filled, or simply outlines, and in color or not. Often online you'll see color charts, as they're more common. The American style seems to be to display candles that close higher than they open as green, and the opposite as red. Kinda like stop and go. It's green? GO! BUY! No, really, you need to know more than just the color. Don't just buy because it's going up for a single candlestick.

You can actually use candlesticks along as basic signs of when you buy and sell. They're not great signs, but honestly, they factor in a lot in my personal trading.

Since the wick going out the top or bottom says that someone bought or sold at that level, this can be an indicator. Just as it closing at a different level can be an indicator. These are all based on buy and sell orders though, so don't get too hung up on them. But realize others trade on them, which gives them more power.

If a wick is going out the top, it means some sold at that level, but people put in sells lower before the time period ended. This might indicate that some in the market really want to ditch their coin. Do they know something I don't? When it's at the top of a climb in price, and the wick is quite a bit larger than the body, this is what is known as a shooting star, and it can be a sign of reversal.

_{Image used under Creative Commons Attribution 3.0 Unported license.(source)}

Of course, if it's at the bottom of a drop, it could also be a sign of a reversal, but a much weaker one, as the market couldn't maintain that higher price.

A wick going out the bottom means that someone sold coin lower, but there were sales higher before the close.

At the bottom of drop in price, this can be a sign of a possible reversal, and is known as a hammer. This is due to the fact that it clearly looks like a hammer. What, you can't see it? It's said to be "hammering out the bottom of the market" or some such. Basically, the price tried to go down farther, but the market was buying things fast enough to take care of it, or no one else wanted to sell that low. It met "resistance" as they say.

_{Image used under Creative Commons Attribution 3.0 Unported license. (source)}

If you happen to see a candlestick with a line coming outta both ends, that sort of looks like a cross, that's a doji. If it happens a bit too often, your head will be spinning, and it will be the cross on your grave. Basically, it means that the market is temporarily neutral. People aren't pushing stronger for lower prices or higher prices in particular. People sold an bought at lower and higher prices, but they ended up somewhere in the middle. If it's rising, it may be a slow agonizing crawl to the top.

It can also be a sign of reversal though, as it does suggest that some are trying to sell, even if others are buying their sells, for now. Only option is to look at the order book, and judge for yourself if maybe you should take a bit of profit.

_(source)

There are tons more candlestick patterns, but I'm not here to teach you to trade on candlestick patterns. I'm not sure I even believe in all of them. Some may just be superstition. You should do your own research. I'm just here to give you a basic introduction.

_{Image used under Creative Commons Attribution-Share Alike 4.0 International license. (source)}

Resistance Levels

Resistance levels are basically just sales clumpings. They're numbers that people like to sell at. If there's a massive sale, then there's a good chance the market will stop there, buy a little, and then as people start to sell off, possibly reverse. This means that it might be a good idea to sell off a bit before it gets close to a previously identified resistance level.

_{Image used under Creative Commons Attribution-ShareAlike 3.0 License. (source)}

Support Levels

Same as Resistance Levels, except opposite. You can use these as signals when to possibly buy in a bit.

_{Image used under Creative Commons Attribution-ShareAlike 3.0 License. (source)}

You can of course buy some back as it drops to support as well, then rinse and repeat, but just make sure your fees aren't more than your profit margin.

With either, you pretty much just look for where the market bounces back from a point several times, and you draw a line. Easy as.

Ironically, what I've covered so far is actually enough to start trading with. Maybe not responsibly, but if you're clever, you could eek just a bit of profit off, if you were careful. But you'd probably make a lot of mistakes. So, you need what I'm gonna talk about next.

Minimizing losses, and maximizing profits.

So you bought in, thinking the market was going to go up...but then it doesn't. Fuck. What do you do? Do you just sell it all, and buy lower? Maybe. But is that lower point going to be the low? Maybe you'll make another mistake.

You gotta make a decision. Are you going to sell off, or are you going to buy in harder? Maybe you'll sell off a little, and buy back a bit lower.

The internet will tell you to HODL, but honestly, sometimes that's a really bad move. When it drops significantly, you're making losses the whole way down. So that means the rise back up is going to be all lost profit.

_(source)

If it's going to drop significantly, you'd probably be better off just selling it all, and buying it back lower. Unless it's bitcoin. Then you're fucked, because even if you could transfer it, the fees are significant, and you can't transfer it. It's gonna take forever.

But what do you expect as advice from a meme to plebs? They don't wanna go through all the techniques to try to ensure when it returns, you're super green, or that even if it never returns, you're at least hurting a bit less, or even slightly profitable.

_{When the market has you by the throat, but you're already green. (source)}

If it's only going to drop a bit, or if you're in for the long haul, maybe you just wanna increase your holdings a little. Maybe you have a lot in, and don't wanna risk the fees being larger than any profits from the rise again. Same if you aren't sure if it's gonna drop a lot more.

Dealing with such situations is pretty basic. You sell higher than it will be, and buy lower. If you do this really well, you can actually make profit, even as a coin goes down in price, if it's also going up a bit as it goes down. I've had a few times where I ended up thinking I'd rather just take a loss after a day of trading, and suddenly realize after I sold it all that I was actually up, even though the price was down.

The key to this all has to do with judging how frantic the market is to sell. If it's too frantic, you're fucked. You won't even be able to sell fast enough. You might even be better off selling at whatever the top rate is at the time. I've lost hundreds of dollars in a flash before due to a market panic selling. It happens. Then I gained it right the fuck back. When you get knocked off the horse, you make it into dog food.

Just try to make sure you don't sell right above where it stops going down, or that you end up buying more in before it's at it's bottom.

But I'm not going to teach you the techniques to do this though. Honestly, it's a lot easier to watch a youtube vid, and see someone actually do it. Do your own research. That is the theme for today. You need to learn how to do this, but it's really difficult for me to teach you in text. This is just to make it slightly easier for you to do your research, and have a bit to get started on.

It's actually almost exactly the same as every other technique to gain profit, except you're simply forgetting about where you bought in for a moment, and just selling where you need to increase your holdings, so when it returns to the previous rate, you've got more to sell.

That smile, when it does return back to where you bought in, and you already have a ton of profit, that's priceless.

Don't Sell All At Once!

If you have a lot of coin, do not sell it all at once. You can cause the market to go down quite significantly. Break up your sales into small amounts. Additionally, you can make more money, if the market is going up, by having a little patience. If the market is going down, it can be scary, but selling a massive chunk will only make it worse.

Don't Buy All At Once!

Not only is it a bad idea to sell all at once, it's often a bad idea to buy all at once on many platforms. You may have misjudged the market, and it could not be going up as much as you think it is. It could go lower before it goes up. Even if you're completely correct though, it's easier to have multiple buys, so the market doesn't just completely pass up your buy-in, and you can put in more than a few as it rises, rather than having to keep canceling it and redoing it.

I've already written a ton on this, so I'm gonna leave it here. I hope that it gave you a little insight. If not, well, fuck, sorry. I'm tired though, so I'm gonna post it. Be sure to do your own research! Learn how the market works at least a little bit, so when you do sell your crypto, you know when to do so. I don't even know as much as many, but I thought maybe a laid back intro to the basics might be good, without as much lingo as when I tried to first learn.