It's been about two weeks since I started trading back and forth between Steem and SBD on the Steemit internal market.
As I pointed out in an older post about why you should trade on the internal market, "trading on the Steemit internal market can earn you some extra Steem without you having to put in much work. It is a safe and easy way for beginners to trade cryptocurrency and therefore it can serve a good purpose for people who are eager to learn about trading."
For me, this is my first real experience in trading cryptocurrencies as well, so let's take a look at how I've done in the last two weeks!
Let's see the results!
I've kept track of everything that happened in my wallet since I began trading. Buying and selling Steem, at what price (in SBD), how much profit I make in Steem, and the post earnings I get in the meantime that don't count towards the profit I make in trading. Beware: the profit is counted in Steem, regardless of its price in dollars/euros/etc. So, whenever I buy Steem with SBD, I buy more Steem with the same amount of SBD I sold it for before... If that makes sense. The idea is to gather as much Steem as possible, regardless of its value. This is because I have faith in the value of Steem in the medium/long term.
As you can see in the table above, I've only done a couple of transactions in the past two weeks. This is because I focused on the large differences in value. This way I'm more certain to run a profit. As you can see, I tried to aim at around $1.20 to buy and around $1,35 to sell. I as lucky to caught some bigger price differences as well!
If you find reading this table difficult, I basically earned 73 extra Steem after selling it when the price was high, and buying it back when the price was low.
After these two weeks I've already learned some interesting things:
Don't follow the crowd
Many people discover a currency when it's already soaring. This means that they will probably buy at a high price. If you're unlucky, the price will go down again and your investment will lose value again. The important thing is to be faster than the crowd. I have learned to buy when less people are interested, thus the price is low, and sell when more people are interested, thus the price is high. If you're faster than the masses, there's profit to be made.
Patience is key
For me, trading on the internal market isn't something I do all day long. I rather wait for the price to rise and fall in large proportions instead of profiting off marginal differences. This way there is a larger guarantee that you will make a profit with your trade. To do this, however, you need to have patience.
Don't listen to your emotions
Discipline is a very important thing to have in trading. Getting excited and emotional will often make you make irrational decisions. Sometimes when I check the Steem price on the internal market, I see that I could have made a bigger profit, so I think: shoot, I should have waited. But oh well, it's already too late now, I can't predict the future and I've made my profit for this trade. Better luck next time! It's important not to make irresponsible decisions. Instead, try to stay cool and keep trading around a target high and a target low. This way, you won't do anything stupid that could lose you your hard earned Steem.
Keeping your profits safe
I am thinking about trading a part of my profits for other cryptocurrencies, so I can diversify my portfolio and spread the risk a little more. I'm not so sure about Bitcoin at the moment, since it just passed a new All Time High, and Bitcoin Cash seems to do really well too. I was also interested in Litecoin, which is pretty stable right now, but I'm not sure if that's the way to go right now. I do have faith in Ethereum, though. The fact that is has real user value (the smart contracts) means that many people value it more than other coins on the market, such as Litecoin. Maybe I will turn my Steem profits into ETH and start Hodling.
Let me know what your thoughts are! What are your experiences in trading crypto? I'm always looking for more advice, so let me know!
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There is so much you can learn here on steemit, i name thought about learning to trade on the internal market. Great idea. One more reason to get started on steemit :)
It's very easy! You should give it a try.
Thanks for reading!
Nice job on 73 more steem honestly not bad at all! Investing 101 don't trade on emotion. In fact I still let my emotions flow but when i feel like the worlds coming to an end like last night with bitcoin I buy instead and 9 out of 10 times so far its worked out very well.
Thank you! 73 Steem is indeed not bad with an initial amount of 90, that's almost double!
Steem on!
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Hi, thanks for the comment and the citation! The spreadsheet is actually very easy to make in MS Excel. You don't even have to know how to use formulas in excel, you can just calculate everything yourself and enter it manually. Hope that helps :)
Cool! Good luck with earning :)