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The thoughts of a professional cryptocurrency trader – Nick Patel

Nick Patel (also known as @cointradernik) is a frequent trader, investor and writer in the field. Since 2013, he has been active in the cryptocurrency markets. Nick gained many followers on Twitter since then. He publishes market ideas and charts with comments. He also writes reports about coins and shares his views on the market in Blog traders for alternative coins.

Binance Academy talked with Nick about trading and investing, as well as his general strategies and lifestyle as an investor and trader in cryptocurrency.

Binance Academy – How do you trade cryptocurrencies?

Nick Patel I first discovered Crypto Twitter in February 2014, after I had read about Dogecoin in December 2013. After signing up with MintPal, I began trading that month.

Academy Share your early trading experiences. Do you think there are any bad deals?

Nick The worst deal I ever made was my first trade. I can remember signing up to MintPal in February 2014. I bought Mazacoin after I noticed it had increased significantly over several days. This trade cost me two-thirds my initial capital and I lost the rest.

Academy: For how long did you trade before becoming consistently profitable?

Nick I spent four months learning cryptography. I attribute this to some good fortune in 2014, which allowed me to adapt, refine and improve my strategies throughout the year. It took me just over a year, except for cryptocurrency.

Academia Are you still trading in non-crypto market?

Nick I trade on all markets. I also trade in cryptocurrencies, indices, and metals.

Academy: Which is the best deal that you have ever made?

Nick I bought Neutron at 130 satoshis. It was sold for an average of 6800 satoshis. This gave me a return of more than 50 times the size of my original position.

Academy: After we’ve gone over some of the highlights, how do you decide what makes a deal a good deal?

Nick A good deal means that you follow your rules. Bad deals are those where you haven’t followed your rules and made an emotional decision regardless of the outcome.

Academia This answer is likely to be agreed upon by many successful investors. The outcome of a trade does not determine whether it is a good or bad trade. A bad trade can result in a loss, while a good trade could prove to be very profitable. It is important to have a solid strategy that you stick with over time.

What lessons have we learned from bitcoin’s long-running bear market?

Nick Rather than focusing on the price of BTC altcoins (which I was), we should have looked at their prices in U.S. Dollars. This is where the bubble was in January 2018. Moving on, I began to consider both the historical context and prices in my decision-making.

Academy It is fascinating to see how crowd psychology on social media can reinforce and create biases. Which traders are most important to you, while we’re talking about community?

Nick Tom Dante is the most important in my process, particularly in regard to logging minor improvements in anticipation to trading.

Academy: Any investor should never stop trying to improve their strategy. How did you discover your advantage? What advice would you offer novice traders trying to discover their market advantage?

Nick I am particularly strong in cyclical positions. When I find undervalued projects that have good fundamentals and low prices, and hold them throughout their market cycles, my advantage is even stronger. To identify your strengths and weaknesses, I recommend keeping a detailed journal.

The Most successful traders record their trades. To identify and strengthen your strengths, it is important to keep track of your performance. Do you trade multiple strategies? Or are you looking for specific trading setups or strategies?

Nick I know a few simple stats-based strategies to trade within a week (or a month) of each other. For long-term positions I first look at the fundamentals, then I buy at historically low prices in order to keep them throughout the market cycle.

Academy How long have you been holding a coin for?

Nick More than a year

Education: It can sometimes seem like a lifetime of cryptography. It can be difficult to manage risks and enter long-term positions in such a volatile market. What indicator do you think is most helpful in assessing the profitability a token or coin?

Nickname The structure for tokens. Inflation is the only constant indicator of whether a token will yield a high yield or die.

Academy: Are you including intranet metrics into your strategy?

Nick To distinguish the transaction volume in the chain from the exchange volume, I look at it. I also pay attention to the rich lists, which are the main holders of the token.

Academy: Which do you prefer, technical analysis or fundamental?

Nick I use fundamentals to determine long-term positions. Then, I make a decision on technical specifications. I only use technical settings to base intra-week spot trades. Additionally, I base all borrowed transactions on technical specifications.

Academia Now let’s get to the practical side of trading. They are important and not to be overlooked. How does your trading day look? And how can you live a sustainable life by watching the screens?

Nick: On Sundays, I do an asset market valuation to determine what I want for the week. This information is then written down and marked up my charts. I set alarms at important price levels, with notes about what I want in each area. Next, I execute my trades. Then, I monitor them periodically.

It takes me more than a week for most trades to be resolved. I spend my time blogging, freelancing and reading. I don’t like to look at screens, which is why I avoid day trading. I can work remotely and use alarms and other systems so I don’t need to spend too much time learning graphs. This lifestyle was not for me so I stopped day trading.

Academy: Which tools are most important for you in trading?

Nick: You don’t really need that much. A tablet, TradingView, and a laptop are all I need. There is nothing else you need.

Academy Without a price forecast, it would be a shame for you to leave. What do you think Bitcoin will look like at the end 2020?

Nickname: 26000 dollars.

Let’s go over some key points that Nick taught us.

  • Establish ground rules and stick to them. Avoid emotional trading. If you let your rules go and make emotional decisions, it is likely that your results will reflect this.
  • Keep track of your trades and look for ways to improve.
  • Sometimes, it is worth taking a moment to consider whether your community biases might be affecting your trades.
  • Do not complicate the situation. Simple setups can make all the difference in a good strategy.

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