Rekt: Learning From Trading Mistakes
CRIPTHALTO CRIPTH 2017: CAUTION FOR TRADERS
Few events in the world of finance are so exciting to watch the rise and fall of cryptocurrencies. In 2017, the only tweet of the now famous pseudonym that wrote Fate for Bitcoin, which fell from $ 19,666 to $ 2886. This event is often referred to as "rect" moment, which is the expression per face for those who have been the victim of trading errors.
What caused Rect?
The collision was struck by a combination of factors. One of the main contributors was the excessive degree of hype and speculation. Many investors have bought the promise of Bitcoin "infinite value" just to remain only with worthless paper when the price collapsed. This phenomenon was known as "whale" psychology, where large sums are invested in a particular device, often because of charismatic shape or unrealistic expectations.
Another factor is the lack of regulation and transparency. The cryptography market did not have a clear guidance on security, supervision and municipal processes, making hacks, phishing attacks and other forms of financial exploitation vulnerable.
Lesson of Rect: Don't follow Hype -T
So what can we learn from Rect? Here are some key taking:
- Diversify your portfolio : Just because you have invested in bitcoin, it does not mean that you have to keep it forever. Diversification is essential for managing risk and reducing the effects of market fluctuations.
- Be careful for hype : Take care of the excessive promises or exaggerated demands of the potential of a particular device. Remember that no one can make sure the future.
- Do not chase profit at all costs : stop chase yields by investing in assets that do not meet risk tolerance and financial goals. Here comes the emotions; It is easy to catch the excitement of a powerful device, only to realize that it has made a mistake.
- Focus on the basics : Understand the mechanics underlying the asset and its potential risks before investing. Do not rely solely on hype or marketing needs.
The heritage of the rect
The collapse of 2017 served as the alarm calls of many investors. He highlighted the importance of the following:
- Risk Management : Investors must be prepared to accept losses and have the risk to manage the risk.
- Dollar cost averaging : Regular investment can help reduce timing risks and avoid market volatility.
- Education of itself : The investment of cryptocurrency requires continuous learning and research. Be informed, but do not rely solely on hype or speculation.
Conclusion
The rect serves as a cautious fairy tale for all trader. It reminds us that, by the very nature of the cryptocurrency trade, it must be approached by a high risk, and must be approached by a clear understanding of the market and our own risk tolerance. If we learn the mistakes of others, we can avoid similar pitfalls and will be stronger on the other side.
More sources:
* "The Bitcoin Bible", Andreas Antonopoulos : A comprehensive guide to the investment and trade of cryptocurrency.
* "Trading in cryptocurrency", Michael Saylor
: Insight into the world of cryptocurrency investment and market trends.
Remember, in Tim Ferriss, "You don't have to be great to start, but you have to be great." Don't just dream of becoming big; Take steps, learn from your mistakes, and create a solid foundation for long -term success.
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