It has now been well over a year since I purchased my first crypto. I’ll never forget it. Since then, it’s been a spectacular journey filled with many ups and downs, naturally. However, even before my first ETH purchase, I made a personal commitment to myself that I was going to do things right this time (for once in my life).

As I started to have more and more success — I quickly reflected on what I was doing, and wanted to see if there were certain things I found myself doing with consistency for every trade or investment I made. What I learned astonished me! I found that I was (to a degree, at this point) following a blueprint of sorts.

At this moment — I realized I needed to solidify and organize my processes for entering trades and picking up new coins/tokens for longer term holds. This was the foundational key to everything I was doing, and now my hope is you find this process as useful as I have.

The fist thing I learned that became painfully, and scarily clear was the volatility. Sure, this is what attracts so many to the space; the lure of wealth and riches in a condensed amount of time for virtually no effort….that’s what we hear all around us, right? Wrong. Well, partially wrong.

Yeah, sure — there are many people making huge profits in short time-frames, I get it. I too have been there. Plenty of times. What you don’t know is the top-tier traders and investors have a plan, and they work their plan. They prepare for success. Even expect it. Additionally, these “Whales” are certainly not hitting home-runs with every at-bat (trade entry). Nothing in this world is ever 100%, and our beloved crypto markets are no exception. With success comes failure.

The objective of the game is to win more than you lose. But how? Well, simple really. What I mean is, take high quality entries and let your winners run. Don’t take profits too early. You can always incrementally pull profits on the way up to lock them in. Additionally, when prices fall, do not hesitate to cut bait and exit the positions. Hope is never a strategy. Let me repeat: hope-is-never-a-strategy.

Trading is like hitting in Baseball: if someone has a lifetime batting average of .300 they are in the Hall of Fame. This means, the best sluggers in the world fail 70% of the time!

The people you see on Twitter touting their successes, the stories your buddy from college has about his co-worker who just quit to trade crypto full-time…those are not one-off situations. These stories are becoming more common. BUT, no one, I repeat no one ever succeeded without a plan, solid structure and proper preparation (including mentally and emotionally).

This article is primarily for the beginner to intermediate level trader & investor. However, even some of the most experienced traders I’ve met tend veer off the (disciplined and structured) path every so often, so let this serve as a refresher for even those with more trading experience.

About the list below:

This is not meant to be an all-encompassing list…rather a guide and check-points to help you navigate as you work your way throughout the thought processes that should be apart of any trade or long entry being considered.

How the list list structured:

Fundamental analysis and technical analysis are equally important, yet server vastly different purposes. I start out with TA (technical analysis) then move to FA (fundamental analysis). There is not reason for this, it is just how I initially had my notes structured in my journal.

If you have questions, or what to chat about anything you read here, please feel free to reach out on Twitter https://twitter.com/CryptoDeNiro

Here are you keys:

Identify if price is trading within a range, or in a trend:

Generally speaking, understand price trades within a range 80% of the time, while 20% of the time price trades in a trend (know this!)

2. Never take any position without 3 reasons to take the trade (be it a pattern, RSI, ichimoku) (fib, MACD, RSI), etc…this is known as ‘confluence’ aka — several supporting reasons all aligning to the same desired result — DON’T FORCE THIS by placing your biases upon them.

3. Volume & liquidity:

What is: historical volume vs most recent 24hr volume

Did price rip or dip occurring on a spike in volume, or low volume? (important to not fall for the seductive fake out)

Liquidity: how many pairs are available to trade with — just btc, or also eth and usdt? How many exchanges list it?

4. What is my risk/reward? Ideally, we want a 3/1 (example: enter position with $1,000 and see potential for $900 profit and risking max of $300 to the down side — not risking more than $300 loss)

5. Avoid buying tops, avoid selling bottoms

6. Identify if price is in an accumulation or distribution phase?

Accumulation = sideways price action after a significant run higher (more bids before the next leg up)

Distribution = sideways price action after a significant dip or sell off (more asks before the next leg down)

Bonus* the longer price remains in an accumulation or distribution phase — the harder the pump or dump thereafter

7. Trading time-frames:

Shorter time-frames = quicker trades and less reliable indicator and chart info — but consider using the 10min, 15min, 30min and 1hr here

Longer time-frames = more reliable chart/indicator data and use: 4hr, 6hr, 12hr and Daily time-frames

Time-frame expectations: is this a trade (intra-day, or intra-week) or a hold for 3–5+ months?

8. Community strength and prominence: Twitter, Reddit, Discord, Telegram for sentiments, investor/trader info and updates (looking for solid supporting evidence for AND against taking an entry, whether a trade or a hold)

9. Other fundamentals to consider:

Inflationary or deflationary? Not all coins or Tokens function with a capped supply — some are inflationary, meaning there will be more introduction into circulation at some point (any decent Whitepaper will have this detailed within it)

What is the distribution schedule and dev team/founders keep, and are their coins/tokens locked for a specific amount of time?

Current Market-cap? What are the competitors (aka sector)?

Does it have a niche target end user/market, or does it address a larger audience (think platforms such as Neo, Ethereum, bitcoin, privacy coins, etc…),

How long has it been available for?

Was it a pre-mine, ICO, etc.?

What is the Dev team and have they worked on other successful projects?

What is the Richlist top wallet addresses doing — are they accumulating or distributing? See here for an example.

10. Understand the difference in being up/down in dollars vs btc (satoshi’s): example: your alts are up 30% but btc or eth is up 40% — you made 30% usd fiat gains BUT lost btc which impacts purchasing power. Also, if you’re up (lets say) 30% on alts but btc or eth is flat or down, you profit in both USD fiat and satoshi’s (more bitcoin or eth — aka purchasing power)….is your goal to trade alts to acquire more btc, or are you only concerned with dollars, or both? If you plan to take profits from the market and want to spend earnings; usd is relevant — however most people want more btc as they expect to have their funds in the market for extended periods of time.

11. Proper mental preparation/psychological: for trades: aim for base hits producing single/double digit gains (singles, doubles, triples) — swing for the fences and your strikeouts pile up. Your long bucket should comprise the (potential) home-runs and grand slams (triple digit and even quadruple digit gains in some cases)…but, despite the strength of the coin or token, these gains still require higher expected time-frames to produce and a higher risk tolerance as sell offs and heavy retracements will occur. Mentally preparing for this before taking any trade instills discipline and cultivates patience. Never fomo buy nor panic sell. If you do, you haven’t prepared yourself accordingly and are not approaching the markets from a position of strength.

12. Pay attention to what other (foreign) exchanges are doing for your selected coin/token — for example Asian exchanges tend to trade at a premium and have higher volume for select coins. Be aware of this, if used properly can serve as a leading indicator in certain situations.

13. Is it a Masternode or staking coin/token? Important because it directly impacts current and potential available supply which may lead to an increased demand.

The bottom line is this:

There are many factors to consider when evaluating any coin or token to purchase. The goal of this exercise is simply to raise awareness about some of the steps I have found useful and what I know to work well. Consistency breeds success, and having a foundation to your approach, and refining your process over time leads to success.

Happy trading, everyone.