10 Tips to Maintain Crypto Profitability during QuarantineDavid Kemp
Experts are ready to share some hints and tips with people willing to find out how they should act if they want to keep their crypto portfolio as profitable as possible even while under quarantine.
Dennis Gartman boasts a rich trading experience – he has been around for a long time and he knows what trading Forex is about. He also knows a lot about commodities, treasures, and derivatives. Investors trust his opinion and follow his advice. His trading prognosis is always accurate. All this allowed him to make a list of his own trading rules.
Most of what Gartman says can be applied to many spheres and various businesses. However, crypto market has its own nuances. You have to take into consideration things like volatility and compare the current liquidity to other markets as well as be aware of the latest trends.
It’s typical of retail traders to take wrong decisions. As a rule, traditional practices do not always work for cryptocurrencies. In some cases they produce undesired results. Here strategies are different and you develop your own tactics if you wish to achieve better outcomes.
Let us now review some of the rules created by Gartman. They information has been adapted for crypto investors.
- Never Increase Losing Position
Terminate losing positions and refrain from increasing them. The best thing you can do is to average down. As an investor, you may offset your loss sooner – just wait for prices to recover. If you purchase ETH at 240 USD and then it falls to 160 USD, increasing your position would averagely result in 200 USD. This method is widely applied yet, according to Gartman, is one of the worst things an investor may practice.
- Cut Your Loss Early
Prices of assets can decrease and achieve the stop-loss. That’s where your position needs closing. Forget about new bids for a while. Here the wisest step is try and sell some more. Frequent and early cutting of losses may lead to success.
- Mental Tension Is Devastating
Financial failures do less harm than all the tension you go through. You do not need positions that ruin portfolio value. Your mental health is important, no doubt. After a loss all you need is to distract yourself and restore psychologically. Pay attention to your mental state. Betting isn’t always good, and bad bets are inevitable. Even experienced traders cannot avoid them. Remember that investments are different from trades.
- Stay Neutral When the Market is Bullish
Once we see that the trade has achieved the top loss, we understand that the investor misinterpreted the market. Bankruptcy follows attempts to predict the bottom. Gartman suggests you should do re-evaluation after a loss. You cannot and must not fight the trend.
- Leave Losing Trades and Stay Patient
Profit comes to investors even when they get no more than 30 percent of their choices right. If your stop-loss is around 7-10%, you are very likely to gain profit. Positive trends as well as high positions allow you to obtain more. Gartman insists you should learn the importance of stop orders during bullruns.
- Power Market Trends
How confident are you of your prognosis and price moves? Market sentiment doesn’t tolerate argument. Your vision is not for everyone even if you think you’re 100% right. You might feel like looking for traders with similar mindset. Pay attention to the general trend and respect it.
- Importance of Large Candles
Revise the position as soon as possible if you see a negative candle during a slow rise. A twenty cent loss may follow after a four per cent reversal. However, a sizeable positive candle may serve as a trigger to a trend reversal. Shifts offer greater opportunities and then investors may want to perform good purchases. Prompt and significant reversals come after long-lasting trends.
- Trades in Cycles for Your Gain
Watch trends and raise the stakes accordingly. When prices decrease, don’t hurry to make greater positions.
- Long Trendless Periods for Patient Investors
Periods may be trendless. Investors cannot always find clear directions. If you are in doubt, stay patient. Positions should be built when there is a trend confirmation.
- Smaller Trades and Simplicity
Have a few tools that you can use for successful trading. The more indicators you have, the harder it will be for you to make the right decision.
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