Learning Crypto trading the hard way and how you can benefit from my experience

In this post I want to share the 'journey' I experienced from the moment I started in cryptocurrencies till now. I also want to share my lessons learned that are (I hope) of benefit to people entering this market and people that are here for (quite) some time but don’t succeed to earn profit.

Over the past months I have learned a lot from an area of which I thought I possessed quite a skillset to analyze and foresee future potential actions. Just for your information, my background is in ICT and within the area of applying ICT solutions in businesses (E.g. software development, network administration, business intelligence, IT Auditing, ERP implementations, SaaS solutions).

Why I started in Crypto
As I am interested in IT and what it can do for businesses and mankind I was already interested in blockchain and crypto’s for quite some time. However, as most (IT) people I am not a trader and was more interested in the technology instead of the financial possibilities to make a profit. After a dear friend of my showed me the active world of cryptocurrency trading of emerging blockchain appliances, I was immediately ‘sold’.
After my dear friend introduced me in creating a wallet, an account on an exchange and buying bitcoins, my journey started. As probably most of you I asked him what good crypto’s to buy. So I started to buy Siacoin, Ripple, Verge and Digibyte. As I heard stories of crypto millionaires who bought Bitcoin for a couple of dollars I ‘investigated’ cheap coins and bought some coins such as Dogecoin and Reddcoin because I thought if these would rise to a dollar, I would make a nice profit. I started with a limit amount of money just to learn how to trade and get better in understanding the crypto’s.

As I started to actively trade in May/June my entry point was very bad as the prices we at its peak but as didn’t know because of inexperience I still bought what I liked and I used the ‘Top Volume’, ‘Biggest Raise’ indicators on exchanges to buy crypto’s with the assumption that these crypto’s were good to add to your portfolio.
After my first buys I installed Blockfolio, a nice App in where you can add crypto’s and add alerts on price levels (belows and aboves). The rest of the month I just watched the prices and refreshed (on a too high frequency) my Blockfolio portfolio to see how my crypto’s were doing. During the rest of the June and July Bitcoin dipped to USD ~1800 from USD ~3000 due to FUD from the Bitcoin Cash Fork that introduced a bearish market (low appetite to buy and prices that are dipping) and 75% of my cash disappeared. Because of decreasing prices I decided to do some trades and sell (with loss) Digibyte and some Reddcoin to ‘save’ my investments. From this moment on I started to lose money because selling with loss is actually losing money.
During this period I learned a lot:

• Never buy on price only but look at total number tokens available and current market cap.
• Don’t look on an hourly basis to pricing if you don’t trade as well at this frequency.
• Gather a mixed group of people to talk with and discuss thoughts and crypto’s.
• Each transfer cost you money, especially on exchanges, and you need to incorporates these as well in your trade.
• Never buy on peaks / All Time Highs (ATH)
• Use an monitoring app to set alerts on price levels on which you want to act

How can everyone earn money except me?
During the period of June to August crypto’s became more well known by the public and on TV shows / Radio, YouTube people were interviewed that earned a lot of money, and I didn’t… Instead of quitting I decided to put real effort and time to better understand this and be more successful.
I started by first reading the white paper by Satoshi Nakamato to really understand the initial concept and think about any appliances of the concept. By doing this I am better able to determine the added value of crypto’s. Furthermore I created a list of 5 - 10 crypto’s that I choose to understand better and perform research on. Lastly, I decided to invest in ICOs that were of interest to me, again I created a list of 5 ICOs per month to potentially invest in. ICOs are far more risky but potential returns are also higher.

How to turn your ‘bad luck’ around
During this period I invested 2-4 hours daily (on avg) by reading all the coins I selected, subscribe to different channels (e.g. Telegram, Discord) and reading ICO white papers to value them. I decreased my trading effort and instead of that I started to read, listen and watch to YouTube or other channels.
In another blog I will discuss my ICOs rating variables (it is already quite a long article).
Furthermore I contacted friends, colleagues, and other interested people to create a community and discuss the developments in crypto’s and thoughts of each other. Especially gathering a multidisciplinary community of people is most valuable to get different insights and views.
After listening, reading and discussing about crypto’s, blockchain and the community I learned some valuable lessons that I still use nowadays. By following several people, discussing with other interested people I am able to create my own vision and thoughts that I now use to determine strategy. Defining and pursuing a strategy is one of the most valuable lessons I learned during this period and I apply this now on a (bi)weekly basis.

Get a portfolio strategy!
Defining a strategy includes determining which assets you invest in, your scalp levels (at what percentage/price do you sell/buy) and for what period. Investing in crypto’s is so volatile a strategy on a weekly basis is good depending on your trade activity. I switched from a daily to a bi-weekly trade frequency by using a strategy that allows this frequency. For me a strategy means:

• Decide which information channels you use for source to collect knowledge
• Create a long list of existing crypto’s to invest in and determine entry levels and expected gains over time
• Create a short list of crypto’s to align your portfolio to
• Discuss with your connections the portfolio to validate
• Research which interesting ICO’s are upcoming in the next period
• Determine the percentage of your portfolio / new money you want to invest in your list of ICO’s, normally I use 3 ICO’s and invest 50/30/20 into them, depending on my expectations in the ICO’s of course
• Follow your strategy and act upon it. I try to don’t let FUD / FOMO act me on impulse because most often I regret this
• Remember that every source you use to gather knowledge and determine decisions/strategy, has a delay in how fast the news reaches you. Everyone that provides you a ‘tip’ beliefs in the tip itself or benefits from it. This is not a bad thing but something to keep in mind.
  Sources I use(d)
  Finally, I want to provide you with an overview of sources/channels I use(d) to gain knowledge. Maybe it can be of use to you.
  YouTube:
• Coin Mastery, Carter Thomas for macro analyses and market insights
• Datadash for data analysis on altcoins
• Suppoman for getting started, ICOs and for fun
• Ian Balina, ICO reviews
• Coin Bloq, ICO reviews
• Several by YouTube recommended videos
  Websites:
• Coinmarketcap.com, for coin and price information
• Reddit pages, for detailed information on my long list coins
• Twitter, for company pages and latest official news
• Company sites, for getting real information instead of rumors
  Slack and Telegram of specific crypto’s.

Please bear in mind that everything I discussed in this article is based upon my experience and can be totally different to you. For the information sources I mentioned I don’t get anything in return, I just want to share my experience.