19 Feb 2025

light mode

Manage risks, do not rush, and other tips for crypto traders

Manage risks, do not rush, and other tips for crypto traders

While trading cryptocurrencies does not endanger your life (aside from the possibility of pulling out your hair), there is a chance that you will make costly mistakes. Therefore, you should arm yourself with knowledge before entering the market.

On this page

Our cryptocurrency trading tips are not a guarantee of success, but rather a precautionary measure. To begin with, profitable crypto trading requires a basic understanding of technical analysis as well as the principles of the digital asset market's operation.

Keep in mind that cryptocurrencies are extremely volatile. The bankruptcies of their ally companies, the tweets of influencers, and other (human and non-human) factors all have an impact on the value of many of them. In light of this, even experts occasionally misjudge how prices will move. Nevertheless, a beginner can reduce losses by using some crypto trading tips.

Don't ignore risk management

Do not turn trading into gambling. Be specific and realistic in your goals, and manage your risks. The first step towards this goal is to limit your trading capital to what you can afford to lose without jeopardizing your standard of living or endangering your mental health. Do not trade highly leveraged assets unless you have sufficient funds to cover the debt in the event of a failure. Caution should be your middle name, as it is better to make a small profit than a large loss. 

Don't rush

The advice is relevant for both day crypto traders and scalpers. There are times when you should sit back and watch the market move rather than take action. When in doubt, wait, test your theory a few times using experiments or other people's experiences, and then come to your own conclusions.

Analyze the market situation

The success of crypto trading is largely determined by how thoroughly you have studied the behavior of the cryptocurrency market under various conditions. This is a very voluminous process, as it is necessary to consider the level of supply and demand, news on a specific crypto project, changes in economic indicators (inflation, base rates, supply chains), ongoing cataclysms, whales’ behavior, current bankruptcies, regulators’ policies, and so on.

It’s possible to benefit from the market through the study of technical analysis and the use of trading strategies based on it. Therefore, don't overlook learning how to read charts and spot patterns in them.

Set Take Profit and Stop Loss

The two most important tools to use when opening trading positions are the take profit and stop loss orders. Make sure to set a realistic profit and acceptable loss, after which the trade will be automatically closed. 

Instead of using these orders, inexperienced cryptocurrency traders may choose to hold onto their positions in the hope of making more money. As a result, they are psychologically trapped in greed and lose profits and sometimes capital.

Pay attention to capitalization

Avoid the common beginner’s mistake and take into consideration a digital asset's market value rather than its price. Just because tokens are extremely cheap doesn't mean you should buy them. High capitalization is an indicator of profitable assets.

Choose an active and legitimate crypto exchange

Rather than looking for cheap cryptocurrencies, find a trustworthy, cost-effective, and time-tested cryptocurrency exchange. Commissions and fees must not exceed your profit.

Check the trading platform's legitimacy before registering. Read reviews and overviews, look for more information online, and get to know the team behind it. Kraken, KuCoin, Bitstamp, WhiteBIT, and Bybit are examples of safe platforms.

Consider the trading volumes

Large daily trading volumes are the primary indicator of high liquidity, which is necessary for successful trading. The higher the daily trading volume is, the better the asset is suitable for trading.

Low liquidity limits a trader's ability to quickly sell and buy cryptocurrencies, making it difficult to enter and exit positions. Furthermore, low trading volumes raise trading costs.

Control your emotions

The results of your trading may not be what you were hoping for if you were driven by greed or fear. To avoid falling into psychological traps, learn to recognize and control your emotions. Stick to your trading strategy, analyze the charts, and don't let your emotions guide you through a process that requires a cold mind.

The given cryptocurrency trading tips will assist you in developing a conscious approach to trading digital currencies and prevent you from suffering catastrophic losses, but they will not replace an understanding of the theoretical basics and the ability to apply them in practice.

The content on The Coinomist is for informational purposes only and should not be interpreted as financial advice. While we strive to provide accurate and up-to-date information, we do not guarantee the accuracy, completeness, or reliability of any content. Neither we accept liability for any errors or omissions in the information provided or for any financial losses incurred as a result of relying on this information. Actions based on this content are at your own risk. Always do your own research and consult a professional. See our Terms, Privacy Policy, and Disclaimers for more details.

Articles by this author
MEMX Files for SEC Approval to List XRP ETF from 21Shares

MEMX Files for SEC Approval to List XRP ETF from 21Shares

The U.S. market is seeing a wave of altcoin ETF applications, and MEMX is the latest player to join in. The exchange has filed a request with the SEC to approve the listing of the XRP ETF introduced by 21Shares, a major name in crypto investment products.

The Coinomist
Bitcoin Bull Run Is Just Starting as Institutions Buy In

Bitcoin Bull Run Is Just Starting as Institutions Buy In

A recent Bernstein report suggests that Bitcoin could soon see strong upward momentum, driven by increasing institutional investments.

Anton Kryshtal
Mystery Coder Burns $7M in ETH—Calls Out Brain-Tech ‘Weapons’

Mystery Coder Burns $7M in ETH—Calls Out Brain-Tech ‘Weapons’

A mysterious figure, Hu Lezhi, has publicly burned millions in ETH, alleging the existence of an underground organization manipulating human consciousness.

Anton Kryshtal
Lawmaker Attacks Trump’s Meme Coin, Musk’s DOGE

Lawmaker Attacks Trump’s Meme Coin, Musk’s DOGE

Democratic Congresswoman Ayanna Pressley has criticized the DOGE agency and Trump’s meme coin, arguing they represent a dangerous shift in financial oversight.

Anton Kryshtal
Weekly Analysis of BTC, ETH, and the Stock Market (Feb 18, 2025)

Weekly Analysis of BTC, ETH, and the Stock Market (Feb 18, 2025)

An overview of BTC, ETH, XAUT, and S&P500 charts, and the current cryptocurrency market dynamics.

Artem Khomenko
Weekly Analysis of BTC, ETH, and the Stock Market (Feb 10, 2025)

Weekly Analysis of BTC, ETH, and the Stock Market (Feb 10, 2025)

An overview of BTC, ETH, XAUT, and S&P500 charts, and the current cryptocurrency market dynamics.

Artem Khomenko
Weekly Analysis of BTC, ETH, and the Stock Market (Feb 3, 2025)

Weekly Analysis of BTC, ETH, and the Stock Market (Feb 3, 2025)

An overview of BTC, ETH, XAUT, and S&P500 charts, and the current cryptocurrency market dynamics.

Artem Khomenko
How to Bump a Transaction in the Bitcoin Network

How to Bump a Transaction in the Bitcoin Network

Sometimes, Bitcoin transactions can get “stuck,” especially if a low fee was set. In such cases, you might wonder: Why is my Bitcoin transaction stuck?

bitOn
Inside Cryptocurrency Farms: How Digital Coins Are Mined

Inside Cryptocurrency Farms: How Digital Coins Are Mined

Cryptocurrency farms and mining have evolved significantly since Bitcoin launched in 2009. To understand their growth, it helps to look at the broader history of resource extraction.

The Coinomist
From Bulls to Ballers — Why Celebrities Are Flocking to Crypto

From Bulls to Ballers — Why Celebrities Are Flocking to Crypto

Trump’s meme coin isn’t an outlier—it’s part of a broader trend. Back in 2021, celebrities were minting NFTs, and by 2024, they had moved on to personal token launches. The connection between fame and crypto has been growing for years, even if many failed to see it.

Vlad Vovk
Which Macroeconomic Factors Make Crypto Rise or Fall? 

Which Macroeconomic Factors Make Crypto Rise or Fall? 

It happens when you check the market and crypto prices are up or down for no obvious reason. Then you do some research and find out that there are actually reasons outside the crypto space.

Anahit Avetisyan
How Blockchain Helps Combat Disinformation

How Blockchain Helps Combat Disinformation

Fake news has become a global issue, shaping public opinion, fueling social tensions, and even influencing political decisions. With the rise of social media, the spread of misinformation has accelerated, making it increasingly difficult to regulate. However, blockchain technology offers a promising solution in the fight against fake news.

Daryna Nesterenko
Trading Psychology: How to Avoid Falling Victim to Your Own Biases

Trading Psychology: How to Avoid Falling Victim to Your Own Biases

The most successful traders aren’t always the smartest. More often, those who excel are the ones who understand psychological traps, manage their emotions, and maintain rationality under pressure.

Vlad Vovk
Pantera’s Tax Probe: A Wake-Up Call for Crypto Investors

Pantera’s Tax Probe: A Wake-Up Call for Crypto Investors

Dan Morehead, the founder of Pantera Capital, is under investigation by the US Senate Finance Committee (SFC) over $850 million in crypto profits. The key issue is whether he avoided U.S. taxes by moving to Puerto Rico, a well-known tax haven for crypto investors.

Anahit Avetisyan
The Bitcoin Kid’s 2011 Prediction – How Right Was He? 

The Bitcoin Kid’s 2011 Prediction – How Right Was He? 

In May 2011, an unusual video surfaced on YouTube. A 12-year-old boy explained Bitcoin – how it works and what its future might hold.

Anahit Avetisyan
MORE
«Mass Adoption Isn’t About Tech – It’s About Perception». Bitmedia Founder Matvii Diadkov – About RWA, Web3, And Marketing

«Mass Adoption Isn’t About Tech – It’s About Perception». Bitmedia Founder Matvii Diadkov – About RWA, Web3, And Marketing

Matvii Diadkov, founder of Bitmedia, shared with us in an exclusive interview his expert insights on Web3 adoption, impact of GameFi and community-centering tendencies in the market.

The Coinomist
“Satoshi is CIA”: Swedish crypto bro opens up about his Bitcoin journey

“Satoshi is CIA”: Swedish crypto bro opens up about his Bitcoin journey

The first crypto craze took place almost a decade ago. Overnight, many people found out about Bitcoin and its underlying technology, blockchain.

Lesia Dubenko
MORE