Top 5 things I have learned from trading as a noobie to becoming an amateur using Bitshares & Poloniex
Dipping my feet into the waters of trading crypto coins!
I recently decided to start trading crypto currencies and it has been a very fun journey! Very emotional and intense but none the less very fun. I started trading on bitshares first (which now I realized was probably a bad idea because it gave me a distorted view of what trading really is), then later opened up my poloniex account.
The difference between these two platform is like night and day. Bitshares is like taking the stairs up to the top of the tower and poloniex is like taking a freaking rocket ship; Especially when everyone is trading at once in an emotional frenzy.
Since I have started trading on Poloniex I have made tons of mistake but I have learned a lot. I must thank steemit for being the thing that gave me the motivation to even try trading; Having Steem is what really opened up my world up to actually deciding to trade because otherwise I would feel it was too risky. The possible (and necessary) losses are very hard for someone with a lacking mentality. Since I have acquired "free" steem (not really, I've invested a lot of my time & money into the steemit platform) I am ok to experiment more with learning to trade!
Here are the the top five things I have learned from trading!
1. NEVER TRADE EMOTIONALLY!
Yes, This is by far the biggest rule of them all. I have heard this advice many times but it is an easy trap to fall into. I should have 0.08839318 BTC (the total of my different timed buy ins with steem) yet because of emotional trading I only have about .062 BTC. This is because of emotional trading losses in margin (pulling out in long term investments to quickly retract on a negative) and on exchange; Panicking when price start to drastically drop and selling on a low. This happened to me when I first started using poloniex because it was so drastically faster than bitshares. Be calm, be patient. The prices of everything will always fluctuate up and down!
2. Buy low and sell high! Be ready to strategically hold on to some trades.
I know this sounds obvious but it is really easy to get into frenzy when prices are rapidly dropping low or high. The thoughts of "will it every go back up or down" have easily popped up in my mind in these moments. With bitshares it is very easy to buy and hold because sometimes it is hard to find a buyer and seller in a quick time frame; This is because bitshares backs all their own assets, so that's all that they provide. With poloniex it is completely opposite! They do not back their own assets, so they trade all coins. You can usually find a buyer and a seller very quickly. Sometimes the changes in prices happen so quickly that there is not enough time to even place your order before the market changes again. This is what has created the emotional panic in me that has caused me to sometimes break buy low sell high rule. Always follow rule 1# and rule #2 will be way easier to follow.
3. Nobody wants to be a taker, always be a market maker.
Being a market maker provides liquidity to the market, so therefore there are smaller fees or no fees if you are a market maker. A taker will always have larger fees because they are taking away from the market. With Poloniex there is a 0.25% fee for market takers and a 0.15% fee for market makers. I find it interesting watching when the market is at a stand still. with just a .0000001 decimal point away between the buy and the sell. From my understanding this is because both sides want to be the market maker and not the taker because of the fees! There are times that being a taker is the best choice because of a rapid price rise in the near future but if possible try to avoid this.
4. A buy/sell wall is essentially a cockblock to your order!
If I am trying to place an order to sell 100 "coins" at a certain price and someone dumps the amount of 5000 coins to sell at a cheaper price, they have now cockblocked me with a sell wall! Now I either have to wait until all there 5000 coins to are bought before I can even stand a chance for mine to be sold. Another possibility is just to cancel my order and place a lower bid!The same thing applies with a buy wall too except it is a buy wall that cockblocks your buying instead of selling. I am not really sure of any positives of a buy or sell wall though. I mostly know how it has affect me during trading.
5. If you know that the market will rise or fall the next day prepare accordingly! Place your order now!
I learned this with the recent hardfork. I knew it was coming and I was ready to be a part of the pump but it was so early in the morning that I missed it. If you know there will be a pump and dump make all your money transfers to your chosen exchange, place several high orders to sell to the high price where you think it will rise to and low orders to buy to were you think it will drop. Then fall asleep peacefully knowing you will be a part of the action even if you are not physically there for it.
These are the things that I have learned so far in my short time trading. Some of it may not all be right but it is what I am going by at the current moment. If you have any feedback, advice or tips for me I would love to hear it. All comments are much appreciated, thanks!
Thanks for viewing my post!
Great post man, many of us that are newer feel similarly on things here - the tone is great - it will help newbs and is very honest!
Thumbs Up brother!
Thanks man, I appreciate ti! Yeah, Steemit has been the introduction for a lot of us to actually learn about the crypto world!
Thanks bro! ^_^
We have had such similar experiences! The panic sell, the missed pump/dumps.. I am glad its not just me!
Haha that's always. It's great to know that it is a normal learning mistake! I completely agree! but I learned great lessons and now know how to prepare for next time ^_^
0.25% fee for market takers and a 0.15% fee for market makers
Yeah I think I said that but thanks for the tip ^_^
no, your blog says something different, check it
I don't see anything contradicting that statement. The only thing I can see that all of you are referencing to is this
^Which is a true statement! The reason I said that it could be no fees is because since I haven't tried all exchanges I don't know if the fees are always the same for every single one.
But then I go on to say this
So I actually did say the same thing as you did, but none the less I appreciate your tip!
The real question that has gone unanswered is, are the maker/taker fees always the same on every exchange platform? I know that taker is always higher and maker is always lower but does the percentage vary?
a 25% fee for market takers and a 15% fee for market makers.
0.25% ... not 25%
0.15% --- not 15%
big difference
Oh shit, my noobie eye totally didn't see that; Even after you pointed that out! I knew that but for some reason I couldn't see my type. Thanks for taking the time to explain that in a very specific way, I edited my post now :p
Yeah a 15-25% fee would be ridiculous! That would be as bad as government taxes!
Another lesson: Always use stop limit :) Good luck in this journey.
oh yes, I have just been learning about this but i haven't tried to implement it yet. My understanding of it is that when the price drop to a certain amount it sets a limit to were you will immediately sell if the price drops below a certain point. Is this correct in my understanding? Thanks you for the tip, I really want to implement that strategically in my trading!
Dude, I though you read my tips. What the hell about "never trade emotionally"? It is the only way to success... :D
What he's saying is don't be a weak hand I believe.
I know. It is kind of a joke. Ballin has commented on my ironic article earlier, so I wanted to remind him the real path, lol
https://steemit.com/funny/@writingamigo/golden-rules-of-horrific-betting-applicable-to-everyday-life-2-trust-your-gutt-feeling-but-not-facts
Ahh. my apologies. :)
Lol yes, I guess it has become an inside joke! ^_^
I still follow the real path! Check my bitsler account stats and I totally still follow the golden rules; I haven't strayed for a second :p I lost a bit but I always try to win it all back the day that I lose it so I can go to sleep a winner! :p
Yes, My trading strategy is completely different from my gambling one! Gambling is just for fun with me, trading to me is totally serious and means business!
Haha yes I know I broke the rule! I feel it is necessary to play by different rules for trading! But I still follow your golden rules for my gambling like I said before. Check my bitsler account stats and I totally still follow that rules; I haven't stray for a second :p
Everyday I get 20 chances for free .00002000 BTC/satoshi and I gamble it with %50/%50 odds! You gotta risk it, all to win it all! You gotta Play big to win big :p
Hi @ballinconscious, I just stopped back to let you know your post was one of my favourite reads yesterday and I included it in my Steemit Ramble. You can read what I wrote about your post here.
Cool thanks, I checked it out and liked it!