I’m realistic enough to know that most people are here because they want to work with Crypto Currencies and they won’t be told otherwise… so if you’re determined to get started trading crypto-currencies ASAP, here’s a simple Action Plan that might help you do it a little more safely and profitably.
One important thing to remember with this kind of trading is, every winner has a corresponding loser…
You only make a profit when you win because someone else has taken the opposite trade to you and lost.
And 98% of retail traders… that’s you and me… lose more than they win.
That’s why the rewards can be so big… only 2% of traders win consistently!
So your goal should be to find a way to give yourself an edge, in order to position yourself in the 2% for the long-term.
And the only way to truly do that is with time and effort… study, practice, discipline and constant, honest self-assessment.
Step 1. Get Yourself Some Theory
If you’re serious about this, there’s no avoiding it… you need some solid training. Trading without a sound plan is just gambling, and you can’t make a real trading plan without some sort of training.
The sad fact is, most of the 98% are just gambling. Even many of those with expensive ‘proven systems’ they bought online…
They might have a strategy or two, but without the knowledge to create a solid trading plan… and the discipline to stick to it… they are going to be improvising any time the market doesn’t perfectly match their system.
So that gives you a real opportunity to find your edge and step into the 2%…
This is totally free and 10 times better than any of the courses I’ve ever paid for in the past. It covers a lot of information in small bite-sized instalments, making it super easy to consume at your own pace. It’s not flashy and doesn’t make any of the grand promises you see so often in this field… it’s just good solid information that pro traders have been relying on for years.
Some of it even presents as a little simplistic, but don’t let that fool you… if you work your way through it and complete the various exercises when prompted, you will be a better trader than most of the people out there.. which will put you firmly in the 2% category.
Step 2. Find Yourself A Mentor To Study
This is actually easier than you’d expect, and it’s called Copy Trading. It’s also something you can start immediately, while you’re working through the training above. It might even help some people meet their need for some ‘action’.
This is part trading platform, part social network… the emphasis is on trading of course, but you have the ability to watch what other traders do, check their past performance and then automatically copy the trades of anyone you like.
This can be a great way to learn if you do it right. That means starting with a small account, watch what your mentor does, make notes, ask questions, and really look to understand the patterns behind the trades.
You should also understand that all traders expect to have losing trades. So note their success rate, and get a feel for the process of minimizing losses and maximizing wins, but don’t for a minute think that any copied trade is a sure thing. This is a game of percentages: knowing your expected win rate and managing your losses.
Always remember that past results offer no assurance of future performance. No matter how good a given trader’s statistics might be, that is no guarantee that their run will continue.
Step 3. Step Up To A Pro Trading Platform
eToro is a good learning platform, but at some point you’ll want to upgrade to a standalone platform which will give you better tools, more control over your account, and depending on the broker you choose, much better trading terms.
For most people, that means switching to MetaTrader 4, which is one of the most popular standalone trading platforms. Most brokers support it, so to get started you simply create an account with a broker and download their version of MetaTrader 4, which will be preconfigured to use their servers.
To begin with, you might find it useful to run an Auto Trading Bot on a small account to get a feel of the way MetaTrader works… even if you run it on a Demo account.
For the most part, I have very little time for Autotrading Robots.
Most make more profits from bot sales than they’ll ever make trading. They’re built to optimize returns based on historical results, and if they work at all, usually have a very short life-expectancy. Most simply cannot adjust to changing market conditions.
That said, there are some that are based on sound technical patterns combined with smart money management, and can have a reasonable expectation of continuing to work into the future. These robots can be worth running as long as you treat them with some caution (suspicion!) and expect them to stop working, eventually!
BTC Robot Trader is one such robot that is working quite well for me at present.
Even so, I never trust it with too big a portion of my account, and I monitor it’s activity closely… ready to intervene if necessary. It is a subscription-based software, but that’s actually a good thing… if they want you to keep on paying to use their Robot, they have to do the work to keep it updated and producing profits! So far they are doing that quite well…
It runs on the MetaTrader4 platform, so if you decide to give it a run, you’ll need to set up an account with a broker first…
Step 4. Set Up A Broker Trading Account
This can appear a little daunting as there’s a huge number of brokers out there and many of them have pretty poor reputations. There’s also a host of broker review sites to help you sort through them, though most of those are just a front to push their own preference… so the website owner gets paid a commission for your business.
That’s quite standard though, and in the interests of full disclosure, if you sign for either of the options below, I’ll be paid a commission on your first deposit. The thing is, almost every broker does this but these are services I actually use myself.
If you aren’t confident though, you can choose to check out some reviews… Forex Peace Army maintains a long list of questionable brokers and outright scams… but I’m confident you’ll find these both come highly rated.
This platform checks all the right boxes when looking for a broker… it is a regulated broker, well established, operating in over 150 countries for the last 10 years. They offer very competitive spreads, fantastic support and training and a variety of trading platforms, including a web-based option for any time you’re away from your desktop.
What I like the most about this platform is their regular technical analysis which often identifies opportunities in currencies I don’t usually follow. Also the Autochartist software that’s included in the package. They also offer trading on the 5 main crypto-currencies at very competitive rates and margins. While most brokers are offering Bitcoin these days, very few have the others, and personally I often to find more opportunities on those.
So even if you prefer to shop around, I encourage you to look AVA Trade over, and use what you discover as your benchmark of what a good broker should offer…
This is worth a quick mention as well before we move on. If you struggle with the technical side of things, then you might find MetaTrader to be a pretty steep learning curve at first. It is a curve you definitely want to master, but if you prefer doing it in small steps, you might find it useful to use Plus500 for a while first…
I first signed up with Plus500 when I was looking for a Trading App for my tablet when I was out of the office.
While MetaTrader ‘works’ on my devices for essential chores, I was never totally happy with it when I was using my tablet, and got caught out a few times when I had trades running and was out on the road and couldn’t easily access the option I wanted.
I looked at a few apps but decided to try Plus500, primarily because it also accepted PayPal deposits, but I was soon pleasantly surprised.
It is very easy to master. It doesn’t have all the technical analysis tools of Metatrader, but if you want a simple interface to place and monitor trades, this is it. They also have a very good archive of training resources which makes it a very good staging point for the less technically inclined to make a start trading currencies.