In a word: Don't.
TL;DR - Don't trade. Invest.
But if you must trade, keep reading and I will eventually point you in the direction of doing it right. Before doing that, I must open a side channel, a second-layer. Think of it as a sort of intellectual Lightning Network.
Let's first define our base postulate: Investment and Trading, a study in contrast
Investment is very different from trading. Investment is something that you do for the long-term. Trading is something you do to snipe a quick buck here and there. If you understand the value of cryptocurrency, you understand that "making a buck" is not the goal. The "buck" is what will eventually be either destroyed or severely undermined by crypto. Why would you trade your precious crypto for that?
You put a million "bucks" in the bank, and you are virtually guaranteed to have less buying power a year from now. This is why you invest for the long term: to maintain or increase the value of your surplus wealth, to beat the inevitable inflation that arises from a currency that needs to increase in supply every year in order to survive. If you're thrifty and live within your means, you won't spend everything you earn. That surplus is what you invest. If you don't invest it, you'll die poor. It really is that simple.
Trading is about maybe eeking out a short-term profit. It's gambling with the title of "Knight." It ain't no bishop or rook, and it's a damn sight weaker than a queen.
Second postulate: #hodl
Either you understand and believe in the technology or you don't. If you do understand the value proposition -- money without banks or other "elite" controlling authorities -- find a project that you like and invest in it.
This next bit is very important: Don't follow leaders and watch the parking meters
Do not invest any money in anything if you can't afford to lose 100 percent of that money.
The above goes for stocks, bonds, real estate, precious metals or anything else. If it's going to burden you. don't do it. Pay off your debts and grind it out until you have a surplus.
Here's what I love about crypto
It encourages savings. If you have a few extra dollars, euro, yen, souvlakis, Hong Kong Phooeys or whatever fiat your geographical situation forces you to use, you can put them into some kind of crypto that will be useful anywhere on this beautiful planet. You won't need a banker to transfer it for you or to take a cut when you cross some arbitrary line. Crypto represents freedom in a very distilled sense. When you buy crypto, you're voting against the current system wherein a select few issue money by fiat. More than that, you're incentivized to save, to #hodl.
And that is really the crux of the biscuit -- HODL
Here's why trading is not advisable
- You'll complicate your tax picture -- if you live in the U.S., at least, probably in other less fascistic countries too.
- You have no way of knowing -- I mean, they say the top P.H.ds from School SuperAwesome are leading the project, but who the fuck knows, really.
Errrm, that's basically it. The only thing you can trust is the tests. Has your crypto of choice dived by 70 percent, then come back 500 percent stronger? Is this going to last? Has anyone even tried to hack it? Are there sleazy "leaders" involved just trying to cash out and make a "buck?"
So don't fucking trade. Invest.