Cryptocurrency Trading Strategies

Cryptocurrency Trading Strategies Cryptocurrency is the hottest topic. Every other investor is considering hopping on this wild bandwagon. But first, know the basic strategies. Cryptocurrencies were the top-performing asset classes in 2021, with an increasing number of investors joining the fray. Investors are looking to get their hands on the crypto market to capture growth from digital assets that possess the potential to grow in value over time. This is also the reason why you need to learn all about cryptocurrency trading strategies. Investing in digital currencies is quite similar to traditional investing in stocks and bonds. So let's look at some basic investing strategies to be aware of when managing your crypto assets. Day Trading Here, you take positions and exit on the same day. The strategy aims to gain profits amid intraday price movements.

Range Trading Sometimes, a cryptocurrency trades in a certain range for a long time, and crypto caps are small enough for a big mover to manipulate. The strategy involves taking advantage of patterns and paying attention to overbought and oversold zones. Scalping Here, you use increased trading volumes to book profit. You have to take care of the margin requirement and other rules to stay astray. You have to analyze crypto assets, past trends, volumes and choose entry and exit points, all in a day. Arbitrage Here, you buy crypto in one market and sell in another. 'Spread' is the difference between the buy and sell price. Arbitrage involves booking profit based on the difference in liquidity and trading volume. Other basic strategies or rather rules of thumb to keep in mind when trading crypto is, Don't fall for the hype. Social media is not for news updates. Do not make trading calls based on the hype created on social media. Primary Research Conduct basic research on the value of the asset you have set your eyes on. Be updated with all the news flow in the crypto world. Bitcoin Volaitility Betting You can bet on bitcoin's wild volatility by trading in Bitcoin futures. You can buy a call and put option at the same time. The strike price and expiration date must be similar. To exit, sell the call and put option when the crypto prices fall or rise vigorously. Read the charts You can learn this through price action. Knowing how to read charts will help you understand why the market is going up, down, or sideways and you will be able to apply a strategy accordingly.

Take up one strategy or a combination of strategies. When we say take up a proven trading strategy, it's the one that is extensively back-tested and has stood the test of time. Deploying a trusted strategy will help you have the confidence to stand by it during harder times. A solid trading system Take up a system defined by technical and business aspects, a structured trade that falls perfectly in line with the overall trading plan. The system also contributes significantly when it comes to successful trading. Now, talking of where you can start trading, there are many cryptocurrency exchanges and brokerages in the industry for you to choose from. Blockchain Tradein is one such platform where you can start your trading journey with a free session with experts, making trading simpler.