Waiting for USDT value to accrue overtime might be a very long wait. Hence, USDT trading is increasing in popularity. While USDT is less volatile than other crypto assets, investors still make several trading mistakes. So, before you start trading, it is best that you know these mistakes. Here are seven common USDT trading mistakes to watch out for before entering the market:
- Ignoring Fundamental Analysis
- Letting Emotions Get in the Way
- Limited Research
- Ignoring Risk Management
- Over trading
- Throwing Patience Out the Window
- Trading Without A Plan
In this article, I explore the common mistakes and how to avoid them. This way, you will be better informed about what to do when trading USDT. Stick around to learn more.
Top Seven USDT Trading Mistakes And How to Avoid Them
1. Ignoring Fundamental Analysis
When many USDT traders enter the market, they enter fully equipped with technical analysis. They know the candlestick patterns and other related tools. While technical analysis is vital, traders can only partially rely on it. Refrain from discarding fundamental analysis as it leads to poor choices. Instead, both analyses should be implemented while trading USDT. You can stay in touch with fundamental analysis by following crypto news channels like Coindesk, Crypto Weekly, and The Coin Bureau.
2. Letting Emotions Get in the Way
Allowing emotions to get in the way of your trades can lead to impulsive and nonsensical decisions. With USDT trading, two major culprits are fear and greed. The fear of missing out (FOMO) can lead you to enter a trade at the top. Greed, on the other hand, can cause you to leave a trade prematurely. When trading with USDT, ensure that you stay logical at all times and stick to your trading plan.
3. Limited Research
Research is the crux of crypto trading. The difference between new and seasoned traders is how much they know. Before entering the market, ensure you have sufficient information about both trading pairs’ assets. This step saves your effort.
An example is spotting a scam coin from a sloppy white paper or uncovering shady intent from the asset distribution. Research can also shed light on the trading type for arbitrage, day trading, or swing trading.
4. Ignoring Risk Management
Trading is all about risk management. Neglecting this aspect can be very detrimental to your trading setup. Many traders often skip risk management because they think it reduces their profit, which is untrue. Risk management protects your investment. You can implement stop-loss orders and diversify your portfolio to ensure you don’t experience significant losses while trading.
5. Over Trading
Yes, over-trading is a thing, and it is common among traders with access to huge capital. As a trader, you should analyse your risk appetite before deciding on an investment capital, especially a large one. While more capital can lead to more profit, it can also lead to significant losses and burn through your portfolio.
Cryptocurrency is volatile. Your capital can be gone in a matter of minutes. As a new trader trying to navigate USDT trading, focus more on risk management and fundamental and technical analysis rather than how significant your investment capital is.
6. Throwing Patience Out the Window
While the crypto space is saturated with people who have hit it big, most wins take time. Crypto investment requires much work and patience, and even losses before people “hit it big”. Don’t enter the market with the mindset of crypto as a “get-rich-quick” scheme. Be ready to take time and know that everything might not play out as you intended.
7. Trading Without A Plan
Some traders are impulsive. They trade the assets that are new gainers and drop out the instant the value drops. These traders jump from trade to trade without a plan or strategy to navigate the market. This technique often leads to significant losses and the depletion of a portfolio. Ensure you trade USDT with a plan. Figure out your risk-to-reward ratio, technical analysis tool, USDT network, and preferred trading pair before entering the market.
Frequently Asked Questions (FAQs) About Common USDT Trading Mistakes
How Do You Make Profit From USDT?
USDT offers numerous opportunities to profit. You can HODL, trade, or stake your Tether (USDT). There are several ways to earn using USDT; you only need to choose the method that best suits your risk tolerance.
Is It Safe To Trade USDT?
It is safe to trade USDT. First off, the value of the asset is pegged to the US dollar, so the value is relatively stable. Also, you can trade USDT with several other cryptocurrencies.
How To Sell USDT For Real Money
You can sell your USDT for actual cash using our recommended over-the-counter platform, Breet. The platform offers swift and convenient transactions with minimal fees. You also get top-tier security, such as anti-fraud technology and other innovative security measures.
Can I Transfer USDT To My Bank Account?
A Naira or Cedis account doesn’t support a USDT deposit. However, you can seamlessly exchange the asset on Breet and have the Naira or Cedis equivalent sent to your bank account in minutes.
Who Created USDT?
Tether, commonly known as USDT, was launched in 2014 by the Hong Kong-registered company “IFinex“. The company also owns the exchange Bitfinex, the first platform to trade USDT.
Conclusion
USDT trading comes with risks, but noting the common mistakes and how to avoid them gives you a better chance in the market. Hence, you must invest in deep research, be patient, and don’t neglect fundamental analysis! While trading will always have risks, you are better off knowing the proper steps from the wrong ones.
Also, working with an indispensable companion like Breet can ensure you seamlessly convert your USDT to cash whenever you like. That said, ensure you trade without emotions and have a solid risk management system.
Stay safe and trade responsibly!
