Tempted by the news of virtual currencies’ formidable prices, you feel lost pondering whether to invest in cryptocurrency or not? Without any doubt, such a tricky question bothers people all over the world.
As a matter of fact, most of them have never dealt with financial operations at all. Thus, the newbies may feel lost in the universe of virtual currency. What is their biggest concern? Sure, the fear of losing their assets.
To make the process of buying virtual currencies smooth for you, in this ultimate guide, we have enlightened all the pieces of advice you should be aware of before your first purchase of crypto. So what are the tips we have prepared for you?
Do a thorough research
The crypto market is highly volatile and unpredictable. Thus, to understand how things work, it’s a good idea to search for some info.
- Read as much as you can and as often as you can on the topic to be in tune with the digital currency trends.
- One more wise decision is to engage in community blogs with vivid discussions. There you could find the answer to the questions that bother you.
- As well, subscribe to mailing lists. They won’t let you miss some important info.
- Listen to the podcasts. There is a high possibility that you don’t have enough time to read during the day. Instead, try listening to the radio/podcast in the background while doing some chores.
- Download books on topics such as digital currency, cryptography, game theory, and economics.
Get acquainted with trading analysis
Virtual currency is tricky – you never know for sure how it will behave the next moment on the market. However, there is a way allowing you to predict the next move. Namely, this is a trading analysis. It’s a tool that gives the possibility to predict price fluctuations. Going deep into the analysis consists of learning price formations and patterns. The most widely used method of following prices on the chart is candlestick formations and triangles.
For any time span, a candlestick is formed from the market sentiment during a single time. Each candlestick on an hourly chart features the price movements for one hour, whereas each candlestick on a 4-hour chart represents the price action for four hours.
Candlesticks are formed in the following way: The top of a candlestick represents the highest price during that time period, while the lowest point of a candlestick represents the lowest price throughout that time period. The “body” of a candlestick (the corresponding red or green “blocks” ) reflects the time period’s opening and closing prices.
As examples of popular patterns it’s necessary to point out doji, marubozu, hammer, hanging man, shooting star, etc.
Triangles are classified into three types, each of which should be thoroughly studied. These formations are the ascending triangle, descending triangle, and symmetrical triangle. These patterns are known to have early breakouts that provide venturers with a “head fake.” Retain for a day or two after the breakout to see if it is accurate. In a bullish chart pattern, experts look for a one-day closing price above the trendline, and in a bearish chart pattern, they look for a one-day closing price below the trendline.
Wedges, pennants, flags, rectangles, peaks, valleys, and so on are also often used for a profound analysis of the current situation on the market.
Never rely on rumors
Many people tend to believe what others say without asking for any proves. However, they forget that to err is human and someones’ shots in the dark concerning price movements may be mistaken. With this in mind, always verify the info you hear or read via multiple sources.
Virtual currency is riskier than many other types of investments. Apart from volatility, nothing is guaranteed. Furthermore, in most cases, it is unregulated. There is no FDIC insurance for this, and there is no customer of last resort. Cryptocurrency prices fluctuate wildly from minute to minute. While the market is completely immersed in the glow of a bull market, it has been subjected to painful and protracted corrections in the past and will almost certainly do so again.
Hence, take into consideration all the factors mentioned above and start by buying a small amount of coins. You do not have to purchase the entire coin. Bitcoin, for instance, can be divided to the eighth decimal place. So, if you’re wondering about how this thing works, you can buy it for as little as $10 and experiment with it.
Choose a robust crypto exchange
If you are ready to buy and trade cryptocurrency, search for the potent exchange. What you really need to pay attention to is the security it provides. In other words, the digital currency exchange platform must dispose of the security certificates. So always check that the crypto exchange you select provides certificates such as SSL encryption.
What is more, the other sign pointing at the reliability of the digital currency platform is its ability to protect your profile from scams. Thus, verify whether your account is protected by 2FA.
Finally, compare the commissions the exchange charges and take a closer look at CEX.IO coin prices.
No matter which crypto exchange you opt for, each of them obligatory takes commission fees for the services. In order not to pay more money than expected, always read thoroughly the Terms and Conditions of the platform you choose. There should be mentioned the amount of the fee the platform charges.
As well, don’t forget to check the terms of your payment method, because they may take an additional percentage as well.
Is it possible to take into account everything not to lose the assets you own?
The answer is obvious: no. Everything comes with experience. The more you get into crypto, the more profit you can get. Take note that no technical indicator is impeccable. None of them consistently provides alerts that are entirely accurate. All actions you undertake depend only on you.
The post The First Purchase of Cryptocurrency without Stress: Which Aspects Should be Considered? first appeared on Mind My Business.