Match by match
The first thing to keep in mind is that you have to invest little by little. For example, instead of putting 1,000 euros in bitcoin (or any other fashionable crypto), it is advisable to start with 200, and if things go well, double the bet until we reach those 1,000 euros proposed at first.
The art of buying and selling
From the creators of ‘buy in the falls’, comes this advice that consists of effectively buying when such a volatile asset falls, and taking advantage to sell, at least half of your position, when it has risen a lot. “There’s no point in being greedy with those kinds of assets because you risk losing everything or almost everything.”
At first, aim to make a modest profit before climbing your bets. “A lot of people have made millions with bitcoin but, like lottery winners, many others have lost a good deal of their money.”
Avoid margin call
Another tip to keep in mind when investing in bitcoin is to never borrow money, that is, leverage, to do so. “It’s a double-edged sword and, if you get it right, you can win a lot but, if you fail, you can end up owing more than you’ve invested.”
Watch out for stop-losses
Since some brokers do not even allow to establish the so-called ‘hard’ stop losses as bitcoin is such a volatile asset, a good idea is to mark a series of mental stop losses and generate the habit to obey them.
Don’t hold on to your losses
If you go against the tide, do not hesitate to sell all or at least half of your position to prevent a small loss from going to greater.
Have a plan
In line with point 6, it is important to have a short-, medium- and long-term plan in mind to guide our actions. So, for example, we may decide to sell only a portion of our position when they go wrong, in the hope that the trend will reverse, as happened to those who sold at $20,000 just before it shot up to $60,000.
Look at technical analysis
This discipline offers you clues and signals to know when to enter or exit a security or asset, especially in one as complicated to deal with as bitcoin.
Never put all your eggs in the same basket, and even less so if that basket is an asset that can go up as soon as it can go up 20% as it goes down 40%.
Practice before investing in the real world
If you get the chance, try making yourself a trial account that simulates the experience of investing before doing it with real money. Otherwise, stick to rule number 3.