Prevent most common crypto mistakes | How to DYOR

DYOR - Do your own research

“It is not just moto, it is not just a rule, it is a lifestyle” – ElliotTrades Crypto. Hearing somebody you trust, know, or just seen somebody on YouTube say something about Bitcoin, Cardano or Polkadot should NOT be the main indicator to purchase a cryptocurrency. Vice versa, doing your own research is key to success, and failing to do so is one step closer to getting wrecked by common crypto mistakes. This does not mean you should ignore others’ opinions at all costs, however, to use it as a way to gather awareness about different cryptocurrencies.

Know what DYOR is? Great, but do you know how should you do it? Let’s take a look of simple steps you can take to start your DYOR journey.

How to DYOR

Step #1 - Check Market Activity

If the recent volume is relatively low it hints at a dead marketplace. In this way, you can avoid coins that have been dead for months, invest in coins that have high volume and promising projects. Additionally, you can ask yourself a general question “What problem does this cryptocurrency solve?”

Step #2 - Social Media

As stated before, purchasing cryptocurrencies based only on a person(s) opinion can be a narrow-minded decision. Common practice on different social media platforms is known as shilling, meaning that people tend to advertise different currencies they own, to affect the price. Secondly, Sybil attacks are a way of boosting a post with fake accounts to become more popular and persuade people to invest in specific cryptocurrencies, these take most commonly place on Reddit, Twitter, and Facebook. Since it is not always distinguishable to spot fake accounts or other methods of tricking people into investing, the most important takeaway is to stay skeptical when it becomes to DYOR on social media platforms.

Step #3 - Reliable News Outlets and Communities

Reading the newspaper in the morning? Good, now dive more into cryptocurrency news to keep yourself always inside the loop to not miss out on important changes in the crypto game. 

List of some popular news outlets:

  1. Coin Desk
  2. Coin Telegraph
  3. NewsBTC
  4. Cryptonews

Joining a community might be a better idea instead of getting information from social media platforms. There you will get a chance to interact with different people more in-depth, gain different aspects from other people or simply just want to belong to a community to surround yourself with people with the same interest. Additionally, there are hundreds of signal groups that give out free buying signals and can be utilized in gaining additional information. 

Step #4 - Technical analysis

Besides fundamental analysis there is also the possibility to look at charts, candle sticks patterns, indicators and test trading strategies. This plays a huge role in day trader life, however can help you to acquire more information, for instance, if the trading currency is in a bear or bullish trend. Moreover, you probably have heard about the expression “buy the dip” or “buy on bloody(red) days”, which means purchasing the currency when it is oversold. There will be always be market corrections and purchasing when the value has dipped is the most simple way to buy cryptocurrencies on “discount”.

Did you also know?!

DYOR Token was created by the victims of scams to bring together a community to fight against the growing number of rug pulls, honeypots, and fraudulent contracts in the cryptocurrency markets. Joining a community is a great way to keep yourself updated about ongoing scams and involving yourself deeper into cryptocurrencies.

DYOR Token community: https://dyortoken.info/#links

More Mistakes and best practices for a crypto investor

Buy PUMPED/OVER HYPED cryptocurrency

Have the urge to go all in when finding a coin that is up 300% in the last 24h? This typical mistakes references to known crypto slang FOMO – fear of missing out. Having the ability to make purchases off your emotions is something that every trader has to master. Simply put, buy the red, sell the green aka buy low, sell high. Similar to that was also the hyped purchasing with Gamestop stocks, where people decided to purchase on the stock market all together.

Going ALL-IN on micro-caps

Everything under 100m is considered micro-cap and this should be a small amount of your portfolio due to high risk. Also, as stated before, checking the market cap is a quick way to separate markets from dead markets.

Selling/Buying out entire position

The magical solution to this mistake is to simply layer your positions over time. This also comes down to controlling your emotions which is mandatory to eliminate them when trading. Basic strategy to sell out a position is by taking out the initial investment with some profit and leaving other positions open just in case there is still some bullish movement. For buying layer positions whilst the price drops. For instance,

Investing into the future

As Facebook released Metaverse, other cryptocurrencies similar to that ide like Sandbox, Sidus, Bigtime, Phantom Galaxy, Immutable x can have a enormous role in the future. The Bitcoin for example, where ten years ago nobody was talking about it and nowadays it is recognized as a valuable and influential asset.

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