As mentioned, bitcoin is unpredictably volatile, more so than any other financial instrument, so it’s vital to have a plan and stick to it.
Before opening a position, consider what level of profit you would be happy to take from the trade, what losses you can afford to shoulder, and set your target and stop-loss levels right from the start.
This is one of the most important tips, as without a disciplined approach it’s all too easy to expose yourself to potentially devastating movement.
Many beginner traders fall victim to greed, holding on to a position for further profit only to see prices plummet, whilst others optimistically convince themselves that a downward trend will reverse as they fall deeper into the loss zone.
By being strict with your profit targets and stop-loss orders, you can easily avoid this pitfall and minimise risk.