Cryptocurrencies have become a very hot topic for the last few years. Many people have earned millions of dollars by investing in Bitcoin at the perfect time. Back in 2009, bitcoin started its journey in the global market. From that period, it has managed to secure a decent place as a standard medium of payment. Many reputed Forex brokerage firms have already enlisted BTC/USD as their trading instrument. So, how can we earn money by investing money in bitcoins? Can we create a stable source of income by using Bitcoin? Well, the answer greatly depends on your skills. If you learn to invest like the pro traders and follow the basic rules of the investment business, you are going to make tons of money by investing money on Bitcoin.
Becoming a millionaire or securing your financial freedom is not so easy. Investment is a very sophisticated business and you must know the ins and outs of this business. But don’t worry! We are not going to give you a complicated guide for investing in bitcoins. Follow the tips of this article to create a stable source of income.
Learn technical analysis
Investing in bitcoin is a very challenging task. You can’t make a profit if you trade Bitcoin in the overbought region. This is the place where the big players cash out and eventually, price starts its bearish correction. You must have the skills to find the endpoint of the bearish retracement and only then you will be able to find the perfect position to buy Bitcoin. Placement of your trade plays a great role when it comes to profit factors. Since the market is extremely volatile, you need to give you the importance of precision when it comes to investment decisions.
A few pips deviation can create a huge difference in your profit factor. So, learn about the technical analysis so that you can find the perfect spot to buy crypto. Never buy Bitcoin based on emotions or gut feelings. The price needs to trade at the support level and only then you can trade with a tight stop.
Avoid buying during uncertainty
Though bitcoin has become popular in most of the leading countries, you should still focus on the fundamental factors. Major announcements related to cryptocurrency can result in massive fluctuation in the price. So, how to deal with such a complex condition of the market. Well, you need to learn fundamental analysis. Most of the naïve traders never give importance to fundamental analysis while buying crypto. But it is often known as the leading indicators in the Forex market. Analyzing the news data is not that hard. Focus on the core news and try to relate the price movement.
If you are not sure, stay in the sidelines. Never invest your money in Bitcoin when you are not certain about the trade setup. Even after analyzing all the key parameters it becomes hard for the retail traders to make a profit. So, focus on rational logic when you intend to buy Bitcoin.
Analyze the risk exposure
You must learn to analyze the risk so that you don’t have to lose your entire investment due to one wrong move. Investment business is nothing but dealing with the probability. If you start taking things as a certainty, you are bound to lose money even if you manage to buy bitcoins at the best possible price. Always analyze the worst-case scenario so that you can create your next steps. Stop placing the trades with high risk since you never know what will happen to the asset shortly.
The professional Bitcoin investors are always analyzing the risk exposure so that they can scale their trade. They invest money from their comfort zone so that they never have a deal with mental stress. Follow their guideline if you want to be a pro at buying Bitcoin.