How to not get rich quick

In 2017 i first put money into bitcoin. I already looked into it back in 2009 but didn’t have the money back then to “waste” on something like that. Well jokes on me, but at least i got in early 2017 and not at the end.

With the rise of BTC i looked into the exchanges and instantly got hooked. Started trading XRP on bitstamp cause i thought BTC got to much volume in it and not enough volatility. Then moved to bitfinex for even more altcoins with high vola to trade. During the rise in 2017 trading was easy. I didn’t risk much, didn’t earn much but i won (pretty hard to loose when the market is super easy to read cause its manipulated like crazy). Then came 2018 and i learned that non manipulated markets are far harder to trade. For every big win came a loosing stride to put me back below zero.

First i traded M15 cause of the thrill and fast moves. No position longer than 2 hours. no overnights. Quick and nice. just not profitable. So i moved higher to reduce the randomness: M30, H1, H4… Still no luck. So i decided to acutally use what i learned back in the days and define a risk strategy and document every trade for analysis.

Truth be told it sucked. First i didn’t want make a real effort so i just exported the trading reports and tracked the equity curve… going down. My “risk the same amount on every trade” rule was a rough calc in my head before i opened the position and the trading decisions where still more impulses while watching the chart on the phone, then real analysis.

So i decided i need to step up the game and scale down the risk. Before i traded positions with 5$ risk per trade. Yes i know, thats rookie numbers. My crypto portfolio would allow for much bigger positions, but with all the crap i did in the first trading year, i was at least smart enough to try find a trading strategy that might work *before* i start to risk real amounts. (Except for the occasional FOMO gamble that always went south…). Now i stepped down to 2$ risk per trade, so with a “max 2% risk per trade” policy i pretend to have only 100$ in my account. And i document for every trade why i started it, with entry, SL and rough target.

On the one hand this allows me to automatically calc the needed pos size (since i document the levels beforehand in a spreadsheet) and really track the development trade by trade and do some analysis.

Thanks to the rise of BTC my portfolio is still green, despite the hundreds of dollars i burned (or spent) on education as trader (aka lost in trading). But even if my current strategy works as i expect it to, i wont be able to live from trading within the next 2 years (cause how slowly i will raise the risk etc.). So getting rich quick is definitly off the table.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.