The Cryptocurrency market is every day growing in size, popularity, and global adoption! And with this trajectory of growth, it is only a matter of time before this industry becomes a mainstream focus of the financial world just like the Stocks and FX market.
With this kind of future, being in this crypto industry right now is the best place to be! It not only opens you up to potentially take advantage of this massive crypto growth yet to come, but it also allows you to learn, make mistakes, fine-tune your trading skills, and get ready for when the crypto run to the moon truly begins.
And in this article, we will be breaking down and helping you understand the 5 Things Still Holding You Back From Becoming A Profitable Crypto Trader and what you can do about it to change your trading story from that of failure and pain to that of success.
1) Trading Is A Skill, Learn It:
The first issue holding you back from becoming a profitable trader is your ego. You believe you can just walk into this industry and figure it out on the fly.
It might take you a couple of years and a lot of lost resources, but in the end, you will learn “when it comes to crypto trading, you need to learn the skillset needed to understand and take advantage of the market before you can start earning from this industry”
And the longer it takes you to humble yourself and find a mentor you can learn from, the more likely you would still be on the sideline, trying out things that don’t work while the crypto bull run begins.
Side note: (This is a wake-up call) Free Youtube videos do not explain what you need to do, how you need to do it, and why you need to do it when it comes to trading, paid courses do!
So make yourself that small investment, learn what you need to ASAP, and move on to the next stage of your journey instead of staying in one place trying to figure it all out by yourself. And while learning, stick to just one mentor, mixing multiple strategies together at the beginning of your journey is a recipe for disaster.
2) Understand There Are Good Times and Bad Times, Don’t Strategy Hop:
The next major reason why you might still not be profitable as a crypto trader yet is because you still think “the grass should always be green every day, every month, and every year when it comes to trading“.
And the worst part is social media is fueling this wrong perception of trading. So let me be the one to break it for you:
You will not always be profitable because the market comes in seasons. Your goal as a trader is to minimize your losses in your Off-Season and maximize your gains in your On-Season
If you can do this effectively over and over again, you will be able to create a sustainable income from your edge in the market.
So take a deep breath and get back to work on minding your business and trading your strategy. If by chance you are currently on a losing streak, this might be your off-season, there is nothing to worry about, take your beating, bear the pain, and move on (it happens).
And in the future when you have another off-season, you will be well prepared to manage risk and have the foresight to take your foot off the gas. Only then can you claim to be a professional trader.
3) Allowing The Myths of Risk to Reward and High Win Rates Keep You Chained:
A lot of crypto traders already have an amazing strategy that brings in a bit of income every month. However, the allure of new and more shiny strategies (and  experts offering a 1:16 Risk to reward trading system that wins all the time) has always been a distraction.
And the truth is, this will always be a distraction for you if you do not find a way to tune out the noise and focus on just one thing.
As a beginner, it is important to take your learning one step at a time. This means, learning one strategy from a mentor, and sticking to it until you have perfected it and made money from using it in the market. Only then should you begin to look for another strategy that you might be interested in adding to your arsenal.
By strategy hopping, you never give yourself adequate time to learn, master, or even optimize any particular strategy to suit your needs. And this is one of the reasons why you might still be unprofitable or just an above-break-even trader.
4) Not Understanding The Kind Of Trader You Are:
“Finding a trading system that works” is one thing.
“Finding a trading system that works for you and your type of personality” is something entirely different.
And this is where a lot of crypto traders are making mistakes. The goal is to find a trading system/strategy that is very compatible with you and the way you handle/think about risk.
This could mean:
- Moving from scalping to day trading or even swing trading.
- Looking for a strategy that offers multiple confluences to confirm a trade
- Trading a more systematic strategy with set rules and less discretion…….and more!
So before jumping into any strategy, you need to find out what your personality is and if the strategy is compatible with you. If you don’t do this and end up picking the wrong strategy, it might work for you, but it will always be an uphill battle for you emotionally.
Check out this article: 5 Steps To Finding The Crypto Investment Style That Suits You. Beginners Guide
5) Bad Risk Management:
Cryptocurrency trading is a high-risk business and more traders lose money because of bad risk management. The main source of many bad risk management is Emotions, specifically Fear and Greed.
The ability to control these two emotions is what separates successful cryptocurrency traders from everyone else. If you don’t get your fears and greed under control when it comes to trading, it can cloud your judgment, causing you to make wrong decisions.
And in a blink of an eye, one big loss caused by your lack of control of your emotions has just wiped out all your small gains for the month. And the cycle of unprofitable trading continues.
How do you solve this? Well, the answer is simple, have a good risk management plan and then stick to it no matter what. Do not let your emotions come in the way, and do not let your excitement on seeing a winning trade make you deviate.
Just stick to the plan and trust the process.
Conclusion!
Becoming a profitable trader takes a whole lot, but there is no one size for all approach. The goal is to find what suits you and then focus on learning as much as you can about it. With time, you will get really good at it and begin to see the positive impacts it is having on your trading.
Disclaimer: This article is meant to provide general guidance and understanding of cryptocurrency and the Blockchain network. It’s not an exhaustive list and should not be taken as financial advice. InvestorsKeep is not responsible for your investment decisions.
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