How to get started with trading

(Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.)

1. Risk management

The first thing you want to master, before putting any capital and energy elsewhere, is risk management. As a trader, survival is your priority: you need betting chips to take advantage of opportunities. Sounds easy and simple, but takes a lot of self control and understanding of principles. Think of risk management as a key which will open the door to profiting from profitable trading ideas.

Cryptocred risk management video: https://www.youtube.com/watch?v=ofwtsc20hOY&t=4s&ab_channel=CryptoCred

Position size and leverage: https://medium.com/@cryptocreddy/comprehensive-guide-to-position-size-and-leverage-2e27764ce9e0

2. Familiarity with your exchange

Thoroughly understand the mechanics of the products you use, whichever platform you choose. The different order types, the liquidation engine, the funding rates implications. Get familiar so that it becomes second nature, and so that you’re efficient in your trading execution.

3. Once points 1 and 2 are MASTERED, you’re ready. The only way to learn trading, is by trading. The market feedback is your teacher. People often ask me about courses, books and such. The reality is that those are helpful once you traded a lot, and can grasp a solid understanding of the game, which will allow you to relate and reflect while consuming trading related material.

• SKIN IN THE GAME: whichever amount you start with, think of it as a necessary learning expense. You’re extremely likely to lose for a while; it’s normal. Personally, I lost for 18 months straight with leverage trading. I was an extreme stubborn case, I know many who didn’t go through such a prolonged losing phase. Simply be aware that you’re likely to, at the very least, have a rough first few months.
• You either make money, make money and learn a lesson, lose money but learn a lesson. For every trade, make sure to keep notes. No need to make it an overwhelming task. At least, make sure to note your entry reason and invalidation BEFORE entering every trade. After the trade is closed, you can add whichever details you deem useful: how it went, what you did well, could do better, why you closed, etc. Maybe add a screenshot. Make it liveable and easy to stick with, at least have the two highlighted points noted for every trade.
• Review your trades at the end of every week: especially in your early learning stage. A simple review of your trades, reading your notes and taking time to reflect. This will help consolidate your knowledge, facilitate understanding of your strengths and weaknesses as a trader.

4. When do I size up?

The market is dynamic, tides shift from bullish, to bearish, to choppy conditions, and so on… The fun part in crypto is that the space moves quickly. If you stay for a couple years, you’ll experience all those phases faster than in any other market. As a general rule of thumb, I would advise to keep your risk per trade minimal until at least 3 months of consistent profitability, assuming you take trades every day. The more you trade, the more you’ll build confidence in your abilities, through various types of market conditions. You don’t become a profitable trader over night, you slowly tweak yourself into profitability from market feedback.

5. The ‘holy grail’

There’s none, you’ll find what works and what doesn’t. Build a style which works for you. Whichever tools you use, make sure to comprehend their functionalities thoroughly, and aim to be the best in the world at using it. Stay away from paid groups: they’re wildly -EV bets. The subscription is not your only cost: you also will spend a lot of time to likely be mislead by someone who’s not making it’s money in the markets. Don’t get sucked in by the marketing sham, there’s no shortcuts. I personally use various tools to take my decisions: newsfeed (tweetdeck), exchange data (open interest, books, funding rates), price action, volume, order flow, etc. All the data is made public by crypto exchanges, everyone has access to the same things: it’s all about your expertise in using it.

6. That’s it, I don’t want to make this guide too extensive. It covers the basics on how to start your journey as a trader. Stay focused: be process oriented. Focus on your mission: to extract value from the market; all else is noise. GOOD LUCK FAM