Hi everyone and welcome to my homework post for Professor @fendit. This is an outstanding lecturer on highlighting the mistakes that are made by the traders. I have learned many new things from this lecture.
A(i). In the given situation where BTC moved to $62000 and If I have bought BTC at this rate.
First of all, I want to tell about my experience regarding Trading. I have worked as a trader and I was working on Forex and it was a very bitter experience. So, I am not a very new trader, and I would have not entered the market at this rate. On the other hand, I would have set Stoploss to my trade. I have learned "Never trade without stoploss" and I mist have set Stoploss to my trade. Firstly, Price Forecasting should be conducted and proper entry and exit points should be identified. After entering the market by buying an asset, stoploss must be set and take profit should also be set to exit the market in either way, Profit or Loss. Stoploss is like a guarantee that protects your capital and you don't suffer huge loss.
A(ii). This lecture has indeed added lot to my knowledge of trading, and after reading this lecture, I would not have entered the market at this price. It is something like " Jumping onto a running train" and I will avoid such trading. I will surely try to buy at lows and at $62000, it is not a good idea to buy at this rate. After a bull rally, there is always a tendency of some correction and at that point, I would prefer to buy the dips. Moreover, without stoploss, it is not good to enter the market.
My experience and mistakes in trading.
(i). As I have already stated that I entered the trading world in 2016 and I lost too much money. I made many mistakes that led me to huge loss. First of all, it was not risk Capital that I invested and I lost all of it in very short period of time.
Secondly, I was not aware of Takeprofit and Stoploss. I entered trades with setting stoploss and Takeprofit. This was a very big mistake on my part and I lost lot of money.
Thirdly, I have no knowledge of Price Forecasting and was unable to conduct technical or fundamental analysis before entering the trades. Also I tried revenge trading after losing some capital and thus lost the remaining capital in revenge trading.
So, it was a very bitter experience and I made almost all the mistakes that have been mentioned in this lecture. After that I was never able to trade as I was under lot of debt and now steemit platform has given me lot of hope.
(ii). After this experience, I learned too many things.
I decided not to trade with greed or emotions.
Always try to make price forecasting before entering the trade.
Always use Stoploss to protect capital and enter the market again with good entry.
Never try to do revenge trading as it can only bring loss instead of profit.
Proper money management strategy should be followed to invest capital efficiently.
Best strategy I learned from this lecture.
This lecture is very detailed and well explained and all the strategies discussed in this lecture are very important to follow. I have also attended other lectures too and this lecture especially has a strategy (Never invest money that you're not willing to lose) and this is the best strategy for anyone to follow. It can also termed as Risk Capital. So always try to invest Risk Capital and then follow other strategies. This is the most important thing that should be considered before investing in crypto trading. It doesn't mean that your capital will be lost, but it simply tells to invest the capital that one can afford to lose and it is extra money. If a trader is using Risk Capital for trading purpose, he will surely be confident in trading because there is no fear and no emotions involved in such trading.
This question is about a panic situation that can lead the market to immediate upward movement. Such news create panic in the market and there are many traders who are willing to benefit from such situations. But I am not such trader.
In such situation, market can react very fastly, but when things settle after some time, market will surely go for correction and I will prefer to enter the market when there is any price action signal on a support level. Support and Resistance Levels are very important in entering and exiting the market and I will wait for any such signal. Moreover, I will trade with Risk Capital and it will give me confidence to trade freely without any emotions or fear.
Now, as I have learned many things from this lecture, I would invest only the money I can afford to lose. In such panic situation, I would not let my emotions control me and I will follow my strategy and trade according to my plan.
A trader should always has a plan to follow and it should strictly be followed. Greed and emotions have no place in trading world and these strategies should be strictly followed. Otherwise, Trading can be total loss and a trader can lose all his investment.
Thanks in anticipation,