10 Tips for Investing in Bitcoin Cash (BTC) in 2021
10 Tips for Investing in Bitcoin Cash (BTC) in 2021
As is revealed in discussions on the same over at runrex.com, 2020 was undoubtedly the year of Bitcoin. This is because, while almost every other industry suffered as a result of the Coronavirus pandemic, Bitcoin has grown even since the beginning of the pandemic. The price of Bitcoin reached new and unimaginable heights during this period as articulated over at guttulus.com. With this in mind, investing in Bitcoin in 2021 can prove to be a very profitable venture which is why many investors are considering doing just that. If you are one of them and are considering investing in Bitcoin Cash in 2021, here are 10 tips that we hope will be of great help to you.
Conduct proper research
One of the most important tips for those considering investing in BTC in 2021 as per the gurus over at runrex.com is conducting thorough research. This is important since understanding the ins and outs of the crypto market will increase our chances of turning a profit from your investment, as well as the fact that it will make the process much easier. Do your research, particularly when it comes to price predictions, with the top-rated guttulus.com coming in handy if you are looking for such information as far as Bitcoin and other cryptocurrencies are concerned.
Start with a small investment
As the subject matter experts over at runrex.com always point out, when it comes to investing in any cryptocurrency, including Bitcoin, you should never invest more than you can afford to lose. Given that Bitcoin is volatile, it is subject to huge disturbances and its value can fluctuate rapidly within days, hours, or even minutes. This is why you should start trading with a fraction of your money, and later on, when you are better acquainted with the market, you can then go for bigger options.
Use stop-loss/cut position orders
Using stop-loss orders is a great strategy if you want to make money while minimizing your chances of suffering losses according to the gurus over at guttulus.com. Stop-loss and cut position orders are tools that will help you cut short losses and, therefore, if you don’t want to suffer huge losses when investing in Bitcoin, you should look for a trading platform that offers these tools. As soon as the price of an asset reaches the loss you cannot tolerate, stop price automatically sends a request to close your position.
Diversify your investments
Another key tip if you are looking to invest in BTC in 2021 is to make sure that you diversify your investments. Don’t put all your eggs in one basket. Diversification could prove to be the key to having a winning investment strategy since if you invest all your funds in one asset, you might have to suffer a serious loss when the price of Bitcoin plummets. Spreading the risk between different investment opportunities or assets as explained over at runrex.com will, therefore, be a better strategy. Avoid investing all your funds in Bitcoin, and instead, take a look at other good investment opportunities such as the stock market.
Monitor technical indicators
Any crypto trader worth their salt should always be aware of trading technicalities. As outlined over at guttulus.com, this means keeping yourself updated with Bitcoin news, demand, supply, price, and other influential factors. In addition to this, you should also have a good understanding of technical tools and indicators. Owning all this critical data will help you forecast movements to assists you make the right investment decisions and move in the right direction if you are thinking of investing in BTC in 2021.
Pay attention to your Bitcoin’s safety
As the subject matter experts over at runrex.com are quick to point out, given the increase in cybercrimes, you must be aware of ensuring the safety of your Bitcoin. The best way to achieve this is to choose a wallet that assures your comprehensive security. If you are serious about investing in Bitcoin, and you see yourself buying a significant amount, then you should use Bitcoin wallets that were built with security in mind, such as Ledger Nano X or TREZOR.
Make sure you have a straightforward financial goal
Your investment goal when looking to invest in BTC can be long-term or short-term as articulated over at guttulus.com. Here, if you are familiar with day trading, then making interest in the short term is feasible. On the other hand, long-term investment will take off the stress of following daily and weekly Bitcoin trends and updates. You can set a long-term goal of keeping your Bitcoin until the Bitcoin price hits say $50,000. Irrespective of the investment goal you set, it is important that you ensure you make it clear and work towards achieving it.
Let your investment have a dollar-cost average
It is worth pointing out that Bitcoin has outperformed other digital assets in the last 10 years. However, as already mentioned, it is also the most volatile, which means that if you are experienced, you might have issues when Bitcoin dips. For instance, if Bitcoin dipped by 50% (from $10,000 to $5,000) in the first quarter of 2020, an inexperienced investor might want to cut their losses and take out all funds. On the other hand, a patient investor that held on to BTC will be smiling now that BTC is above $35,000. Therefore, according to the gurus over at runrex.com, a good strategy is to have a dollar-cost average, which means your investment will be periodic. You might choose to invest $500 on the first day of every month, which will help you make your cost price variable, while also reducing the effect of short-term volatility.
When is the right time to buy?
If you are looking to invest in Bitcoin in 2021, one question you will find yourself asking is when the right time to invest is. Here, as revealed over at guttulus.com, it is worth noting that given that throughout its history Bitcoin has generally increased in value at a very fast pace, followed by a slow, steady downfall until it stabilizes, it is usually difficult to predict accurately near term Bitcoin prices. However, you should use online tools and Bitcoin price charts to analyze Bitcoin’s price history which will help you make a decision.
Don’t invest in Bitcoin mining if you are a new Bitcoin user
Finally, another question people ask is if they should invest in Bitcoin mining, as covered over at runrex.com. It is worth noting that mining, which could once be done on the average home computer, is now only done profitably using specialized data centers and hardware known as ASICs, which are built for the sole purpose of mining Bitcoin. Today, it costs millions of dollars to even start a profitable mining operation, which means that Bitcoin miners are no longer a profitable investment for new Bitcoin users.
Hopefully, these tips will help you as you consider investing in Bitcoin Cash in 2021, with more insights, tips, and information on the same to be found over at the excellent runrex.com and guttulus.com.