Cryptocurrency & NFT’s trading can exploit those with low self-control, don’t let your emotions get in the way of trading logically. Trading based off analysis and data is a key way to make sure you aren’t making risky decisions that may come to bite you in the back financially. While entering the NFT space, it is best to stick to a budget, not spending more than can be afforded, and not chasing losses.
Below we will be breaking down emotional trading factors I see become more & more prominent as NFT trading is gets mainstream acceptance:
Instant-Gratification
This psychological game that I see repeat itself over & over again has become a toxic trading habit by many people within the space. This type of trading is commonly known as ”paperhanding” with this, users buy in hopes for instant returns on an investment.
Whether its following the “hype” of a project or blindly buying in, this trading method can be avoided by creating a stop-loss/hold-time.
FOMO
Fear Of Missing Out, the envy of someone making more than you, not taking advantage of bigger gains. These events trigger anxious and spontaneous decisions that more or less, lead to a risky decision.
Profitable trades will appear time and time again, its best to just let the past be the past & collect data on why/how this certain NFT rose & how you can apply that to help you find the next profitable flip.
Idea of Crypto being Non-Tangible
Trading within crypto creates the false perception that the money made within the ecosystem is just “play money.” the value of 1 ETH compared to US Dollar plays a certain mind game when it comes to trading. 1 ETH is the equivalent of $1607, yet, the perception of losing a 1 digit number makes the trader feel less accountable then losing a 4 digit number.
This makes traders feel as if it wont effect their portfolio as much if they lost 0.5 ETH of their total 1 ETH. With this being said, even the tiniest amount of cryptocurrency holds a real world monetary value.
