Some tips for new and experienced investors just entering the cryptocurrency space.
Newcomers to digital currency should not enter blindly; first, they need to understand the basic knowledge of digital currency.
1. Trading time is unlimited, meaning a true 24/7 trading time without market closure, allowing investors to trade at times that are convenient for them. This is quite flexible, but it also has a downside: professional investors need to invest a lot of time to monitor price trends and interpret market news.
2. Trading rules allow for spot trading, buying high and selling low to profit from price differences, or using leveraged contracts where both long and short positions can be operated. This is quite flexible, but to make money, a high level of technical support is needed.
3. Trading fees, any investment transaction incurs fees charged by the platform. Fees also apply in digital currency trading, and due to leverage, the fees for each transaction can be relatively high. Different platforms have different trading contract specifications.
4. The T+0 trading model allows buying and selling at any time without strict limitations on trading hours.
5. There are no limits on price fluctuations. While this can lead to high returns, it also carries high and uncontrollable risks. When market news causes sudden movements, it may lead to sharp rises or falls, and whether one can seize the opportunity to profit depends on their skills.
6. The coins in your wallet can be withdrawn at any time without time limits and without fees.
Before engaging in formal trading, it's best to master the following four points:
1. Learn to interpret news and understand market information. Major market news often leads to the largest price fluctuations in digital currencies, which can result in significant rises or falls. Traders need to make judgments. For newcomers, it is advisable to wait and observe during major news events.
2. Learn to analyze technical indicators. The study of technical indicators requires long-term accumulation. Create a learning plan for yourself, studying moving averages, KDJ, Bollinger Bands, candlestick patterns, volume-price relationships, capital flow, etc.
3. Develop a trading plan. Avoid frequent trading, as it not only incurs high fees but also affects your trading mindset, leading to irrational judgments.
4. Implement risk control. Ensure stop-loss and take-profit measures during trading to manage risks. Keep both profits and risks within acceptable limits. When the price reaches the stop-loss or take-profit point, the system will automatically close the position, meaning selling. Additionally, managing the size of trading positions is crucial, as it is a skill mastered by experts.
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Investors in the cryptocurrency space, whether newcomers or experts, gain not only financial returns but also growth in investment knowledge and experience.