3 Things Not to Do When Bitcoin is Going Down – Hacker Noon

Trading or investing in cryptocurrency is a psychological war against yourself. Stock traders often say that investing in traditional markets requires extreme mental discipline. That discipline is how they control themselves when the market is volatile. How they stop from making stupid decisions, and keep on track with their strategy.

If traditional trading requires extreme discipline, crypto requires the mental fortitude of Jedi. The crypto market is more volatile than any market the world has ever seen. You need to be the emotional equal to Yoda meditating on top of a mountain during a meteor shower.

Yes the world might be ending, but it’s all good, you’re hanging out on your mountain top.

Photo by : you might be better equipped to catch bottoms. This isn’t directed at you. This is for everyone else, the retail investors that make up the majority of this market. You’re not the Wolf of Wall Street, and you’ll bank more coin if you stop thinking you are.

Don’t sell your coins for ones that are going up.

Everyone’s done it. You don’t have to be ashamed. It’s only human. We’ve all sold the bottom of a downtrend only to see it immediately reverse and shoot upwards.

It seems like everytime I abandon ship on a coin to FOMO into another one, the coin I sell goes up. FOMO stands for Fear of Missing Out, it’s a common fear that causes a lot of bad decisions in trading.

Let me paint you a picture.

You buy $XYZ at $0.25 cents, you’ve done your due diligence, studied the charts for a while, and you’re ready. You didn’t even try to catch the bottom, you know this is a long term hold so you’re fine with your entry. You’re cool as a cucumber.

Two weeks pass, $XYZ is still at $0.25 cents. You’re starting to question your beliefs, sense of logic, even your reality. You start getting into arguments with old people at Denny’s about what “money” means. The longer your bag sits firmly on the ground and not the “moon” , the more bitter you become.

Two more weeks pass. $XYZ is at $0.20 cents. You’re friend John who just got into crypto last week told you about some sh*tcoin called $ABC. You laugh at him for even considering any coin besides $XYZ. Then, a mere 6 hours after John buys $ABC it skyrockets. It goes up 70%, John thinks he’s the king of crypto. He offers you advice, knowing that your coin is still in the gutter.

It’s at this fateful moment that you lose sight of what is most important.

Your strategy.

Screw it!”, you exclaim.

“This market doesn’t make sense if it rewards idiots like John”, you think.

After all, he’s only been trading for 12 hours and he’s up 80%, what kind of sick joke is this. He already got that promotion over you, and now he’s getting all the good trades?!

The next day John’s stupid $ABC coin goes up 150%. You stare out your window, not at the beautiful LA skyline, but at the street below. Wondering if jumping out the window would hurt less than watching John tell everyone in the office what “Hodl” means as he waves around his hardware wallet. You get home, open up your exchange, and say goodbye to $XYZ. You sell all your holdings, at a loss, and move your capital into $ABC.

The next day, $XYZ goes up 800%. John calls you, excited, “Congrats! I saw $XYZ mooned today, oh man I wish I got out of $ABC while I was ahead, It’s down now, practically the same as when I got in. I should have listened to you and bought $XYZ”.

Don’t be that person. I’ve been that person, it sucks.

Don’t stare at the charts all day.

Believe it or not, you can’t force a chart to go up or down with Jedi Mind Tricks.

Sorry for all the Star Wars references, I watched the Han Solo movie last night.

Trust me, I’ve tried. When I first started trading I used to spend countless hours “charting”. Looking back, if I’m being honest with myself, a lot of those hours were wasted. Sure, I spent a lot of time actually studying and applying what I learned to my trading, but I also spent a lot of time aimlessly staring at a computer screen for hours on end.

I learned that the majority of my mistakes where made in moments like those. When I wasn’t being productive, I was needlessly monitoring my holdings like a hawk. It made me more emotional, and it made me overtrade. Two things I now know to avoid at all cost.

Sometimes the best thing you can do, is set a limit-order, and walk away. Trust your strategy, and always remember — if you’re not trading with a strategy, you’re gambling.

— — — — — — — — — — —

If you want to learn more about trading, technical analysis, or even just chat about the market

Stop by Cosmic Trading and say hello, my Discord handle is RezaJates#5824

Join the Trading Channel

Some of my recent work..

read original article here