I would suggest you to be prepared to jump out again. The most important rule in speculation is: to have a plan (specially: to have a stop price where you should sell if things go wrong) and stick to it.
Most people lose money because they hate to accept a loss, so they keep the position on hope, converting a speculative short-term/median-term move on a long term negative bag-holding. Accepting losses is the test for any trader.
Or, at least, buy in increments, saving a few to real low values, just in case.
Bold:
I think this good advice. After the recent rise from $340 to over $540 I should have set up a plan, something like "If it drops back to the $460-480 range, the trend is not reversed and I should sell and wait for a lower entry point". Perhaps I will set up a better plan than I have now. However, the probability (in my head) of the price going lower than $260 seems low.
Italics:
The worst (not really the worst...)
part of selling at $430 is knowing that I wanted to sell earlier but didn't. Your sentence pretty much sums up me as "most people". Though I don't have a lot of coins (relative to most on this sub-forum) and that I haven't invested more than I can lose, sealing in a $1000+ loss was not fun. It certainty would have been easier to hold, but I'm hoping it will be more profitable to have sold.
The flip side of that is that I recently got slaughtered on a short trade where in contrast to my actions every single time previously that the trade has went against me, I decided to hold out for the opportunity to break even. I Shorted Bitcoin at $420 around a couple of weeks ago and instead 'taking the loss', I decided to be like 'most people' and and hold out on the trade knowing that 99% of all my losing trades could have been winners had I only held on. Eventually, my nerve broke and I came out trade at $512 taking a 60% hit on the total funds in that trading account. I even rationally calculated that this price point would have been a fantastic point to start slowly entering a short trade at but when the pressure is heavily on the psychological can of worms is opened and irrational behaviour rules the day.
Funnier still, is that we are right back down at my break even level. If only I could have been like 'most people' and refused to accept the loss, I wouldn't have lost thousands of pounds. Should also point out that Bitcoin did peak at some 35 cents above the price point which would have seen my whole position liquidated....had I not partially closed a portion of the position.
I knew pretty soon into this short trade that it was a bad un and that this was going to be my 'acid test' to see whether I had what it takes to trade cool n rationally. Of course, I never figured on exactly how bad it was going to get but the end result is that I failed, I took losses that I never had to take and had I just held out making a few minor adjustments to my position, then I would have realised none of the losses that I have and would now be in a position to go ahead and profit on that fkn agonising trade.
The conclusions that I have come to is to never again use leverage and to never short any asset ever. Shorting is counter intuitive and not good for someone who relies heavily on intuition.