Cryptocurrencies

Confession of a Trader Addict – Cryptocurrencies

Last week, we saw together the emotions perceived in trading, and how to manage them. Today, we will continue in this topic, with a practical case. This article does not really constitute the fourteenth chapter, rather a chapter thirteen bis. And, I will be frank with you, the writing of this article is a little particular for me … Since it is from my personal experience that we are going to discuss! Come on, make yourself comfortable, with the drink of your choice, a little popcorn to savor my inglorious experience, and off you go!


Preamble

Before getting to the heart of the matter, I think that a small implementation context is necessary. Indeed, I will tell you here a personal experience. And the word “personal” is important here!

What happened to me, how I reacted, and everything that follows may never happen to you. Or maybe you will recognize yourself. I do not know.

Nevertheless, I think that in any experience there is interesting lessons to be learned, and therefore, even if you are not entirely concerned by this experience, I think you can learn from this story.

My beginnings in trading, prudence is the mother of safety

When I found out Bitcoin (BTC), Ethereum, and more broadly, cryptocurrencies 2 years ago, I didn’t know where to start. Very quickly, I took the beast by the two horns:

  • Technology (#Heu The Blockchain is The Revolution)
  • Financial

I will not detail here my technological learning on this field, this is not the subject. So we will focus on the financial aspect, and in particular, everything related to trading of Bitcoin and crypto.

My beginnings in the trading world are not very glorious. Indeed, to put you in context, I couldn’t even read simple japanese candlesticks.

Bitcoin chart
This image was completely incomprehensible to me at the time, 2 years ago

I even remember wondering why to do it violence to read such graphics, when a simple curve was more pleasant to look at.

Obviously, in the meantime, I learned, and if you followed this Trading Forum carefully, you know that the subject has already been discussed !

I then inquired. I read everything that was possible, I took advantage of the slightest break at my work to document myself … In the evening, I followed the lessons BabyPips (an excellent free English site for learning the basics of trading)… In short, I lived, breathed, ate and drank trading!

And I am like that. When a notion strikes me passionate, I’m totally into it, with the desire to learn more and more ! This is the origin of Cryptodidact

2 years ago, the shy Florian behind his screen who created Cryptodidacte saw here a way to interact with the community and so to learn more easily. I never could have imagined that it would go so far turn my professional and personal life upside down. But it’s a whole different story!

Profile image of Cryptodidacte on the CryptoFr forum
My beginnings as a Cryptodidact

As you can see above, I started by not participating on social media … but on CryptoFr forum ! 728 messages, in a few months, it must be said that I was on it every day.

Besides, little aside, but this forum is excellent if you start and you are looking for some help. The community is at listening, available, and very united.

Work and persistence, the first results

By dint of reading, learning and of exchanges on the CryptoFr forum, I ended up develop my skills in technical analysis, but also by assume my analyzes.

I no longer had to hide behind other people’s analyzes, I shared mine with envy, without pride, but with the conviction that it’s by forging that one becomes a blacksmith !

It was then that I created my Twitter and started to share my trading with you.

And as you can see, there is no certainty or arrogance. I was aware of my limits, of my gaps, and I mostly stayed in a learning lens by interaction.

So I started to trading more and more. My trading style is generally rather banal: trading altcoin pairs against Bitcoin (XXX / BTC), with trades lasting from a few days to a few weeks.

And despite a raging bearmarket… The first results pointed the tip of their nose ! I made an average of 6% monthly gain on my total capital.

6%, compared to the 500% promised by the gurus sellers of signals, I grant you that it is little. However, taking into account:

  • My beginner level/novice ;
  • The bearkmarket.

I don’t think I should be ashamed of this result. Then I saw, every month, my bitcoin stack grow, grow, grow … Heaven what!

Cryptodidact taking himself for Scrooge during his trading
A little too innocent CryptoPicsou…

With euphoria comes addiction

Heaven ? Oh no … I was light years away from imagining what was going to happen. My favorite mantra is: “This will work as well”. Unfortunately … I discovered this principle too late. To put it simply, this sentence reads from two angles. If a situation goes wrong, “This will work as well”, there is hope. But when a situation is fine, “This will work as well”, you have to stay humble and prepare for everything.

When all is well, gains are present, we are euphoric, like on a little cloudTo The Moon even !

The concern of this premature success, I’m just starting out in trading. And that these results ended up making me to go crazy. I called it the “almighty trader syndrome“(Admittedly, it smacks of inventing concepts, right?).

Indeed, the gain can have a perverse effect. Especially on me who am competitor in the soul.

Winning is good, winning more is better. Always want to improve, grow, do more, more, more.

I got to a point where, not have a trade in progress, it was a heresy. Here is my reflection which seemed to me supposed at the time:

  • When my capital is in trade, he fruitful ;
  • Now, he is not in a trade;
  • So I “Lose” the gains I don’t make.

And there you have it, how to trade successfully can make you see “stable” capital as a loss. And this is the start of the slippery slope …

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Indeed, after that, I did what you could call “Over-trading”. I traded far too much. Instead of let the opportunities come to me, I them forced.

It’s very simple, so that you understand what was going on, as soon as I had any BTC available, I would go through TradingView and I only stopped when I found a trade to do.

I have learned an important trading lesson at my expense: to be patient is also to trade. Not having a position is already having a position.

The intelligence of the profitable trader, it’s from know when to go, and when wait. Lucidity that I did not have at the time. And you can imagine … It ended badly.

I have chained losses. My results plummeted, and I couldn’t focus on all the things I had learned before.

Under these conditions, it’s as if you’re blinded. Besides, a term exists for that: tunnel vision (or tunnel effect in French). We use this term to describe someone who has a narrow view of the situation. Such was my case.

I was so focused on trader, trader, trader, that in the end, I didn’t see that I was running for my loss

Heal fire with fire

I was off to a good start sink into darkness forever (I would have made a great Dark Cryptodidact, I will have changed my logo for black hair!) …

Until the moment that served me as first electroshock : My total capital has become lower than the capital I had invested in my early days in cryptocurrencies. Outch. I can tell you that morale is taking a huge hit at this time. And the ego too. But so much the better, this is what i needed.

The second electroshock arrived almost at the same time. Indeed, in my daily learning, I read a lot of books dealing with trading. And a passage from one of these books resonated strongly with me.

Extract from a trading book
Extract from book “Living from trading” by Alexander Elder

What do you mean ? Me ? I would be an Alcoholic Anonymous? Or rather, a Anonymous Loser in that case ?

The confession was not easy, but I had to face the facts:

  • The losses were linked ;
  • I couldn’t not stop trading Nevertheless.

This is how I realized that I had omitted in my learning one of the essential elements in trading: the psychology.

So, I took the root trouble, and I acted like an alcoholic in redemption would act: complete weaning !

So, for several months (on my tweet I wrote 2, in reality we were approaching more than 3 or even 4 months), I am forbidden to take any position. I could consult my graphics, carry out my technical analyzes, find opportunities … but I never concluded with a position.

These few monthstotal abstinence taking positions would not have been useless, on the contrary.

Indeed, during this period, I redoubled in intensity on my learning. And above all, I have caught up my gaps on everything that was psychology, risk management, capital management, but also, the managing emotions.

I discovered that i knew nothing, which I had previously only touched on the tip of the iceberg called Trading.

It was also during this period that I became aware of the interest of personal development, that I improved my lifestyle, with more sport, more rest, etc.

I had hit bottom, and I have pushed with both feet to rise to the surface. With limitless desire. As a competitor, defeat does not collapse. On the contrary, it shows me the way I still have to go, and motivates me all the more!

It is from this moment that I started to annoy you more and more on Twitter with the management of risk, of its capital, but also by insisting on the fact that trading was not just about analyzes technical… Far from it!

Following these beginnings worthy of the greatest roller coasters, I became much wiser and moderate in my actions. I learned a lot, both on the theory and practice of trading, but also on myself. To trade is not to face the market, it is above all to face yourself. And, I was not ready for this fight when I started.

Today, I am more fulfilled than ever (cucul phrase worthy of a Disney, but it is so). I trust my skills, while perceiving my limits. And every day, I push those limits a little further through hard work and learning.

And thinking about it, I tell myself that my biggest mistake was not to become a trading addict. My biggest mistake would have been to give up and give up at the time. Today, I manage to trade in a healthy way, with success, and without getting carried away by my impulses.

And I take advantage of this learning to regulate my desires, my impulses, elsewhere. Because, no, I did not manage to make them disappear in 2 months so easily. Now, when I want to indulge my feelings, I turn to poker that I started (in amateur mode, without headache, or capital management), or other activities like running in competition, with timing objective.

And if you, too, one day encounter the same pitfalls as I do, I hope that you will be able to overcome them. And find solutions to allow you to gain stability.

See you next week for a more classic chapter of the Trading Tribune, I promise, stop talking about me!

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See you soon !

Previous chapters of the Trading Grandstand:

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