A) Place yourself in the following situation:
You bought BTC a couple of days ago at a price of USDT 62K. Suddenly, you see that this situation is going on:
What would you have done before reading this class? What would you do now? Explain in detail if there's something you would do differently.
MY REACTION BEFORE JOINING THE CLASS
As an investor who is new in the crypto currency space, I will definitely panic at the sight of my Coin which I had a buy-in and is already having a bearish trend. I am too pretty sure not to have any rethink of my action rather that look for a way to pull down my assets before it goes down the drain. Looking at the trade already, I am about $8 short of my initially invested amount, hence I will be really tensed to allow any more shortfall in this regards. As a lay man, I am better off with the balance of $54 than any other thoughts short of my actions which may bring more loss of asset value.
MY REACTION AFTER JOINING YOUR CLASS
With my three months SteemitCryptoAcademy classes and Prof @fendit classes on today's lecture, i think i am a bit exposed to some series of actions to take prior before and after the bearish trend. I have come to know about the STOP-LOSS tool, which regulates my percentage loss in an asset and put risk level aversion in check, hence i will apply this which would help stop any further loss on the trade as soon as markets goes bearish.
On the other hand, I will quickly open the coin-market to ascertain the movement of this asset as at the moment to determine my immediate next line of action. My expectation would go this way; if there are mass outflow or sell-outs of bitcoin at the moment, which tells me from all indications that it will continue been bearish whereas if there trends in the assets are very infinitesimal in terms of cash outs/sell outs, i would continue to HODL until market reverses and corrects itself.
More so, if my investment drive is a long term one, there are every indication too that I do not need the investment outcome at the moment, hence i will allow the market to reverse and corrects itself. Remember too, I can use the Relative Strength Index (RSI) to determine if the assets is either overbought or oversold which also tips me off on what else to do.
B.Share your own experience when it comes to making mistakes in trading:
What mistakes have you done when trading and what did you learn from them? If you have little experience when it comes to trading, tell if you got to know about someone else's experience.
MY LITTLE EXPERIENCE AND A FRIEND'S ORDEAL IN TRADING
First, I would want to share my friends experience on this issue since I have little or no experience in crypto currency trading. My only mistake so far was loosing my TRON account since i could not provide my Private keys to transfer my assets. So, to my friend's experience too; I have this senior male friend who I believed is quite knowledgeable in the online trading but this was his woos. He told me during his start up , when he engaged the FX markets and invested $200 to enable make some quick profits. I did not really know what exact trading tool he used but I learnt he mentioned opening many positions at that time. I guess that would be margin trading and precisely the cross margin trading which was seen to be more risky. He said he wanted to make quick cash from it since it opens up for more potential gains immediately, and before he could say jack, he lost all his invested dollars in a twinkle of an eye. He got agitated and re-invested another $100 and this towed same line too. It was an unfortunate moment for him then.
LESSONS LEARNT FROM THIS SCENARIOS
For me who misplaced her TRON private keys, I was able to re-download the TRON PDF file and now kept it in a more secured way by filing it and also got it backed up in the cloud/G-mail. Then for my friend's experience, It was obvious he needed to be experienced enough to engage the market which is seen to be very volatile. He needed to deal more with the various market indicators, trading patterns, exit/entry, fundamental, technical and sentimental analysis etc.
Also he was trading with greed and emotions. Ability to tame our emotions during trade is a sure way of being focused for a more profit oriented trade. He does not need to re-engage the market the second time when he lost the first one almost immediately. Staying off for a while and re-examine what went wrong should have been his best shot. This led to over-trading and unnecessary exposure to market volatility
Which of the strategies discussed in the class you find the most useful for you? Why?
The class was an indeed an awesome one, but I will like to thrown more lights to the ones I found more interesting.
OVER-TRADING: I see most people in this category as those who usually do not have a self controlling limit to indulge in this and not necessarily newbies and new-entrance. This is prompted either by recovering what that has been lost or trying to get more after price changes has given an opportunity to reap from. This very act of over-trading exposes the trader to highly market volatility which causes more loss of assets and also the quest to gain more or recover lost assets gives room for more and suicidal loss of assets.
EMOTIONAL TRADING: This does not only keep us to the ground but also continually ruin our chances of getting better in the trade market. If we've lost assets in the trade, we should be able to know when to exit and make the next entry positions into the trade. But when we keep re-engaging the trade, we may not be in a best position to make profits. This generally lead to revenge kind of trading. Revenge Trading leads to more loss of assets and makes us worse off.
Place yourself in the following situation; You're browsing Twitter and you see this
You see that whenever this kind of things happen, BTC prices rush. What would you have done before reading this class? What would you do now? Explain in details if there's something you should differently.
MY REACTION BEFORE JOINING THE CLASS
My reaction before joining the class would be a one way direction decision making just as I've narrated in my previous experience above. I will quickly make an entry into the market and get this asset into my portfolio. My intentions would be, how do I break even quickly from this, bearing in mind price changes as market continue to go bullish. I would be a typical short term investor in this case.
MY REACTION AFTER JOINING YOUR CLASS
Most times it is not the our entry points that mostly matters but our exit positions in a trade. I will definitely have two positions here. Firstly , I will quickly apply my usually market indicators/analysis by ensuring that all is well set before diving into this price rush. Lets all remember that, price rush here is basically on the sentimental analytical approach. And if I could remember, the fundamental and technical analytical approaches dominates and plays a more critical market analysis than the sentimental analysis.
When the same twitter man bought some huge amounts of this assets and was announced, the asset price went bullish for a while, and we already experienced a bearish trend last month on same assets. This is to say this price rush here is only for a temporary period before market corrects and reverses its self. A better analytical approach to determine if this price is overbought or oversold is the Relative Strength Index (RSI).
On the other hand, BTC is a LEADER coin and hence the basis for other coins to follow. So, if I have spare cash which I may not necessarily be using at the moment or needing anytime soon, I may likely make an entry position. This is based on my idea that no money invested in the cryptocurrency without been traded is lost except when we trade with them or account gets compromised. All I have to do is wait let a longer period of time when its bearish so as to welcome a bullish trend capable of positively exceeding my entry positions for profits.
Thank you Prof @fendit for making an entry into your homework task for the week.
Thank you for being part of my lecture and completing the task!
My comments:
Nice work! :)
It was very nicely presented and your tasks were fine!
Overall score:
6/10
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