Turning crypto trading into a full-time profession (2024)

Cryptocurrency Trading

Being a full-time trader is a dream profession for many. What’s better than waking up in your pajamas, making more money in two hours than you make in a week at your day job and being able to afford Rolex’s and Lamborghini’s?

Many will try their best to achieve this dream but few will actually make it. Is it because they weren’t cut out for it? Some have all the right skills but go about it the wrong way and that’s what holds them back from achieving true financial freedom.

Crypto is a “once in a lifetime” opportunity if you can avoid overleveraging and losing large amounts of money quickly. Understanding this became the golden opportunity that allowed me to quit my day job and become my own boss.

If you haven’t read part one of this trading series I encourage you to check it out before proceeding:

Now that you’ve developed an understanding of the market and how it works, you must learn about how trading works. This is part of a sequence that every aspiring trader needs to comprehend:

• Step 1. Understand the markets and how to analyze them.
• Step 2. Understand how trading works. This includes strategizing, position management & more (we’ll cover this below).
• Step 3. Live trading.

Most people will go from step 1 to step 3 and lose the game before it’s even started.

Let’s move straight to step 2. The hardest part for practiced analysts (remember they’re not traders yet) is making the transition from making informed predictions to setting trades that best apply their research.

It’s neither easy nor fun and I questioned my abilities plenty while I made the transition. I found myself entering a trade based on my usual analysis, being stopped out and then price going exactly where I thought it would go.

So how did I make a successful transition from analyst to trader? I first had to learn that the market is never wrong. It will only ever do what it wants to do and not what you or I want. After my fair share of losses, risk management became my number one priority.

I took a big step forward once I realized I could lose three trades in a row, win one and then be in profit. After I learned what risk management and risk to reward ratio were , I developed a trading strategy using trendlines, EMAs (I use Gooner EMA), and my favorite indicators; Top Goon X and On Balance Volume.

I discovered that the better R:R I could build into my strategy, the lower my success rate needed to be.

After figuring out how to avoid getting stopped out on all my entries and learning more about what invalidated my trades, I could then work on improving the success rate. That’s when I turned a 1:4 R:R strategy with a 40% hit rate into a 60% win rate with the same 1:4 risk to reward ratio and when I really started to see success. It took a lot of trial and error to get there.

After consistently outperforming the income from my day job and frequently making more money trading while still there, I decided it was time to quit and become a full-time trader. It was a hard decision.

I was going from a stable salary and a well-paying job to a career that I could potentially lose money in. I was very lucky to quit just before the bull market took off last year but I still took steps to ensure I would be in a secure financial situation in case I majorly screwed up trading.

Here’s some steps I took and things I considered:

1. Build cash and crypto savings
I made sure I had at least two years’ salary in extra cash reserves. This means cash sitting in an account somewhere that could be left untouched and only tapped into if absolutely needed. It did not include regular savings or investments, it was a complete side stash/emergency fund.

How did I put away this extra money? I did it through trading and investing during my free time long before I chose to go full time. Most of last year I was taking trading profits and moving them into a separate account to stack as reserves.

I also had some cold storage crypto that I partially tapped into just to make sure I had plenty of reserves and could feel comfortable quitting. I wanted the least amount of pressure on me if I didn’t succeed right away.

2. Hire a financial advisor
This was one of the best decisions I made. Not only did they help me set up a business account to run my trading through, they also helped me set up numerous accounts to save money on taxes and investment accounts.

We moved a lot of funds out of my bank account (because USD depreciates over time) and let them be managed in low risk accounts. Rather than sitting in my bank doing nothing, that extra growth has already surpassed the value of what my salary would have been at my day job!

3. You still need health insurance
This is something you might not really think about because it’s usually provided through your employer. If you plan on quitting your job make sure you figure out the cheapest way to get health insurance. Luckily for me, I got on my wife’s plan at her job.

4. Set a trading routine
The hardest part of being a full-time trader is to keep a work schedule, hours and a work routine. At first, I was basically working around the clock. My wife was getting annoyed of my extended hours and I could tell I was getting burnt out from monitoring charts all day every day, even in the evening hours when I was around friends or family.

I finally set up a work schedule where I’m in my office by 8am and done for the day by 3pm at the latest. For anything else I can set bids or alerts but I try to stay mostly away from the charts in between these hours unless I’m managing a position. Weekends are also off limits.

I’ve learned to identify the best times for trading that provide the most volatility. Otherwise I can spend a lot of time staring at charts during sideways action and “time is money”.

Trading is enjoyable so I’m not running out of my office on Fridays like I was at my day job. You have to learn to separate work from free time and it’s not easy to do that when you enjoy your line of work and it’s so easily accessible. Especially since crypto is a 24/7 market.

5. Know when to make a trade
The biggest thing about being a full time trader is not completely wrecking yourself when the market goes against you. You have to learn to identify market conditions, “no trade” conditions, and understand that your income will not and does not need to be consistent.

If you make your previous yearly salary in one week, it’s perfectly okay to not trade for another couple of weeks. I’ve learned to use set positions sizes and only a couple times have I gone for a “home run” when market conditions are perfect for it. This limits my overall downside potential.

6. Traders must take profit
If you are a full-time trader you obviously have to take profit to pay for bills and living expenses. There are multiple ways to go about this and it will differ for everyone. The goal is to remove profit from exchanges so that it can’t be given back to the market.

Some ideas for profit taking:
a) Set an amount monthly or weekly and take a percentage in excess of that amount.
b) A set percentage of all trading profits get withdrawn.
c) All profits get withdrawn and trading accounts stay at a set value.

I chose strategy c. Once I built my accounts up to a comfortable level, I now trade using various ones and all profit gets withdrawn at the end of week to reset my accounts back to their base level. If some accounts are down I’ll use accounts that are in profit to rebalance the levels of the ones that were not in profit for that week.

Becoming a full time trader is a challenging journey of endurance. There are easy aspects like the enjoyment of being your own boss and not having to commute, but there are many difficult aspects as well like learning to hyper-manage your own money, being strictly disciplined, and understanding that full time trading is a long-term game of survival.

Going from being a “normal” person with a 9–5 and taking on a full time trading career forces you into a new paradigm of life that goes against the norm in so many ways. From being part of a new asset category, from severely modifying your schedule, to evaluating your expectations of money management and lifestyle, it’s a challenging transformation but one that offers tremendous rewards for those that can make the journey through the difficult years.

The progress along the way is real. The bad days are real — the screw ups, losses, and the pain. But just as real are the results, the profit taking, the freedom of a different lifestyle, and most importantly the change in yourself along the way.