Maintaining The Right Cryptocurrency Trading Psychology

If you keep your eyes on the crypto markets daily, there always seems to be a huge gain for a coin as well as a huge loss for another coin. Look at all the recent Bitcoin Cash drama for example. People start to panic and either sell at a loss or they want to catch that big "gain-train" and buy in at the top of the price because they don't want to miss out. When large swings of volatility hit the market it is of the utmost importance to maintain the right cryptocurrency trading psychology so you don't fall into many of these common traps & pitfalls. Keep reading as I talk about some best practices for beginners just getting into the crypto space. 

Accept The Risk

First and foremost, you must "Accept the Risk". Now repeat it again to yourself...

Accept the risk!

Cryptocurrency investing is risky, plain & simple (less risky then trusting the government with your money, but that's just one 'Stache's opinion!). Playing the Stock Market is also risky. Driving in your car each day is probably the MOST risk you take on a daily basis, but most of us don't bat an eye at this fact. If you start by personally accepting this risk and making your internal psyche aware of this fact, you can begin your journey understanding what you stand to lose. The golden rule is "don't invest what you can't stand to lose" and following this lets you stay focused on the goal: profits.

Don't Fear The Reaper

The second pitfall to avoid is the massive amount of Fear, Uncertainty, & Doubt that gets spread around the investing world. Make no mistake, there are large players out there, or "whales" if you prefer, that will try to manipulate the markets to their whim. They use news outlets and social media to spread FUD (Fear, Uncertainty, & Doubt) so they can take advantage. This is nothing new, and it happens in just about every investment industry. The real difference is cryptocurrency is still in it's infancy so there is much less regulation and more speculation.

Blindly listening to other people about how this coin is going to fall and this other coin will now be "king" will only lead you down the wrong mental path. You need to have a plan!! Do your research, don't take just a few peoples opinions (including MINE!). Everyone is susceptible to giving into FUD (even The 'Stache), and all we can do is learn from our mistakes and keep trying. 

You Are NOT Missing Out

When you see that massive gain on the Bitcoin charts and think "If I don't get in NOW I will miss out!", take a step back and use that brain of yours. The Fear Of Missing Out, or "FOMO" as its called, can be a strong driving force in peoples decisions. Fear is a major part of the basic human psyche and it has saved our human butts many times over. This same type of primitive fear can be triggered by FUD and FOMO events in the market. People are confused, they don't know what to do, they stop thinking and maintaining that right trading philosophy, and THAT is where bad decisions are made. There will ALWAYS be another time to buy and another time to sell. Don't go chasing waterfalls or rocket ships to the moon! Patience and research are your friends on our long crypto journey

Screw Your Expectations

If getting rich quick is your plan from the start, I strongly suggest you re-think that (use that brain thingy we talked about earlier ok?). There is NO get-rich-quick anything. If someone is trying to sell you that BS, walk away immediately.  We need to keep a handle on our expectations, in particular when you are new to cryptocurrency, so we keep things realistic. If you are just starting out, expect to lose. Then do your second trade and expect to lose again... I know this may sound counter-intuitive, but loss is just part of the game. The thing that matters is that you learn from it. Learn from each mistake you make and then do better next time. I have made plenty of mistakes along my way as well (see articles here about my Litecoin FOMO, and how I lost a bunch of BCash), but I have learned from each mistake and resolved to do better next time. Expectations can be hard to overcome, even for myself, but recognizing your unrealistic expectations is the first step to combating them. 

Stop Messing With My Emotions Smokey!

Unless you are from the former planet Vulcan, you probably make some life decisions based on emotions. Trading on emotions can be quite dangerous as it puts us in a vulnerable state that makes us WAY more susceptible to the above mentioned pitfalls of FUD, FOMO, and unrealistic expectations. If you become emotionally invested as well as financially invested the markets can easily drain you of both. Identify that you have become emotionally attached and take a step back. Let the logic wash over you. Having emotions can be a boon in many cases, but trading on emotional impulse will most likely end badly. 


Maintaining the right trading psychology can be a tricky balancing act, especially in a very volatile market. The first step is to accept the risk, then steer clear of FUD & FOMO news advocates, keep your expectations in check, and understand that emotions can play a part but not rules your decisions. No matter how hard we try, ALL of us will fall for one of these. It is what we do after that defines us. Will you learn and prosper, or will you be doomed to repeat the same mistakes again and again? The 'Stache is here to help you learn and prosper, but don't just take MY word for it do your own research too!

'Stache That Crypto Before You Get All Emo!

Shea Newkirk

The ‘Stache
Howdy! My name is Shea Newkirk and I have been a Bitcoin supporter since 2014. I am immersing myself in the cryptocurrency world and I decided to jot down my story as things unfold. I am a designer, coder, musician, gamer, father, blogger, entrepreneur & more. Learn from my mistakes and rejoice in my triumphs because the ‘Stache is set to disrupt the crypto world!


  1. Carson

    Good article & some good tips–

    Although, I read in one of your prior articles that you are not someone who bought into Ripple. Now weren’t you going against the main goal of making a profit & leaving emotions out of it in making this decision? I know Ripple is not liked among many crypto purists and early bitcoin adopters because it is not decentralized & bank partnerships are involved, but the bottom line is XRP was the best performing coin (gains-wise) in all of 2017, increasing in price over 30,000%
    I’ve read from a lot of crypto traders/investors that they will never buy the coin because it is not a true cryptocurrency, has bank involvement, founders hold billions of coins, centralized, etc. But on the flip-side, they have great technology, a great team, massive investment money, CURRENT real-word use, and for the time being banks are still a necessary evil in this world.

    Now I am a bit partial and full disclosure Ripple was my first-ever crypto purchase at $.03 early in 2017, so I’ve seen a 100x gain (before recent correction). This type of gain blew my mind and got me hooked on digital currencies and now I hold bitcoin, eth, ltc and a bunch of alts as well. I’ll admit I was lucky because the main reason I bought it as a newbie was the super-cheap entry price (at the time I didn’t know about total coin supply/market cap, etc), but I also researched xrp quite a bit prior to buying.

    So my point is there were a lot of crypto “purists” that did not buy ripple when it was at 3 cents, a penny or sub-penny due to their philosophy that a digital currency had to be decentralized and fit into this utopian, anonymous, “no-government” / “no-banks” financial system, which is probably quite a long way away. I wish it wasn’t a long way away but I just think that’s the reality. These “purists” missed out on the best performing coin of them all for 2017, where a $1k investment would have returned $300k+ (I didn’t put that much in initially unfortunately) (smile) And who knows, maybe ripple bridges the gap between the broken, corrupt financial system we have now, and the “utopian” one aforementioned. In other words, becomes the first blockchain with widespread, mainstream real-use which will act as a springboard and “changing of the guard” sort of speak in the financial system. Your thoughts?

    Lastly, although I’ve been investing in crypto for quite some time, I’m torn on one principal philosophy… Buy early and hold, or take profits along the way and buy dips/corrections to accumulate more coins ? In which do you profit more in your opinion? I bought in with small positions relatively early on ripple, stellar, ada, and xvg and the coins have appreciated unbelievably. I haven’t touched them since purchasing and feel that I’ve left some money on the table, especially considering the last few days massive correction in the market overall. For example in Ripple I feel I should have sold at least half of my holdings on that recent big pump to $3.50 , and then bought back in when it corrected down to $2.00 and so on and so-forth. Cardano and Stellar both had similar large corrections. There is more risk and a lot of research time involved when trying to predict where the top of a pump is and the bottom of a dip is in my opinion. Do the gains in profit-taking and dip-buying justify this?

    Thanks a million & post a Ripple Xrp address on you site so I can donate a few to you for all the free advice you give 😉

    Thanks and sorry for such a long comment !


    1. Post
      The 'Stache

      Hi Carson, you are right I do not support Ripple and it is not an emotional decision. As you stated later, it really comes down to my “philosophy” which I separate from my emotions. I got into cryptocurrency because of the Ethos of Bitcoin, not for the profits. If all I cared about was profits, I would not be writing this blog and would just be day trading, but I truly do love helping out beginners in the cryptocurrency world. I am working on an article about WHY I don’t support Ripple and it is all about the numbers and not emotions. On top of those numbers, they don’t support the same ethos that I do and that makes it much less appealing. While the technology may work great I don’t support central banks in any way possible. This also is not emotional, but philosophical. If all you care about are “gainz” then yes, Ripple might have made a lot of sense to hold and sell.

      If you support Ripple then you support a future that looks a lot like our present where a global banking oligarchy controls how, when, why, and where we transaction with our money. I am not a “purists” by any means, but I won’t support a coin created by banks, for banks, to continue to hold on to the control they maintain. When you talk about this future that is “a long way away” I think you are dead wrong. I think it will happen much sooner then may think and I want it to be here as soon as possible so I invest my time in that direction instead of supporting the current corrupt system (even if that means sacrificing 30,000% profits).

      As far as your investing strategy, that is a hard one honestly. I think that holding may end up being more profitable unless you are a very consistent trader. Taking profits is a good thing and I am working on an article about it as it is something I ALSO don’t do very often and should. If I am going to hodl a coin I do it for atleast a year and purchase that coin knowing that. Other coins I buy with specific intents like 10x profits or whatever before selling.

      I appreciate the offer but I DON’T have a Ripple address! (big surprise huh?) I sure do love Litecoin though 😉 – LRb1uMgJxyT9RGnQxN2bKg96W7snTHrzv8

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