If you want to trade with a rewarding but risky financial asset, you could try your luck in the crypto market. However, keep in mind the risks involved, as the digital currency market is a highly volatile economy with an equal chance of making or losing a lot of money. Every trader should understand their short- and long-term risks and profits as it is also advised to investigate various price predictions for the selected cryptocurrencies.

Experts make price forecasts after thoroughly researching market factors, blockchain technology, and the demand and potential uses for the relevant currency. As a result, an investor can be confident that such a forecast will reduce their investment risks. If you're an aspiring investor and trader of digital currencies in Australia, the following are mistakes that you must avoid as you gain a better understanding of the cryptocurrency market.

Trading Without Establishing A Goal

Consider why you want to trade and determine which cryptocurrency asset you want to date with, especially in Australia, where the number of crypto assets available will rely on the exchange. Are you venturing into crypto trading because everyone else is doing it? Do you see it as an investment opportunity, or is it just an approach to make a quick buck?

While the objective's internal consistency can be debated, it is critical to have a goal in mind before engaging in crypto trading. A trading strategy with no goals is similar to driving a car without a GPS when you don't know where you're going.

Not Utilising A Reliable And Efficient Platform

Trade stabilisation, price fluctuations, expenses, history, commodity prices, and user experience are all important considerations when selecting a crypto platform. Finding the best crypto trading platform for you could take some time and effort, but it will be well worth it. A straightforward method is to read professional reviews.

Given the numerous factors to take into account when selecting a platform, it's important to understand its functionality and credibility. Platforms such as Immediate Edge are both trustworthy and secure. Aside from that, it allows users to communicate with professional brokers, which is a useful feature to consider when deciding where to trade.

Not Studying Crypto's Jargon Before Jumping In

Do you understand your DeFi from the DAO? What are your Nocoiners and Altcoins? What is your HODL from Cold Storage? You're not by yourself when you don't understand it. The world of crypto is so full of jargon, abbreviations, and assumed information that it can be very exclusive and exclusionary. For instance, a recent news story from a crypto newsletter states: "Goguen: Alonzo Hard Fork. The Alonzo Protocol upgrade went live on Cardano mainnet around 10:00 pm, enabling Plutus smart contract capabilities."

The high dependency on jargon is unsurprising for currencies established by web developers, but it can make reading about potential investments mindboggling and off-putting for us mere mortals. It's no shock, then, that around 77% of Australian crypto holders are between the ages of 18 and 44 ; according to BTC Market's 2021 Investor report, which similar percentage is male. In short, despite an increase in the number of female and older investors, the "crypto bros" who communicate with jargon language continue to run the show.

Making A Massive Investment At Once

Except if you purchased bitcoin in 2010, it's generally not a good idea to buy a large quantity of the cryptocurrency and then leave it alone. Since Bitcoin is fairly expensive and susceptible to semi-regular price swings, the dollar-cost averaging is a more prudent strategy.

Instead of buying $10,000 in ETH immediately, it's likely a better gamble to spread this purchase out over several months. By buying $1,000 or $2,000 in ETH each month, you can compensate for and even out the price fluctuations, attempting to balance dips after purchases with rises. In comparison, with a single large purchase, you risk overpaying and experiencing an immediate drop in its value.

Final Thoughts

The preceding guide does not necessarily prevent you from selecting a single crypto asset and sticking with it for the long term. It simply means spreading out your investments in this single crypto asset so that the falls and rises are equal.

Making a choice of only a few cryptocurrencies and HODLing them for the long term is, indeed, the core principle of cryptocurrency investing. Once your own investigation has shown that a specific coin, or group of coins, is truly likely to increase its value in the coming years, the only logical course of action is to stick with them regardless of what else happens.

To be sure, additional knowledge may spring up that dramatically changes your perspective of a cryptocurrency, but if it doesn't, no amount of social media hype or negative media coverage should change your mind.