What to Know About Cryptocurrency Trading Before You Start to Trade?
Cryptocurrency trading is the start of operations on any exchange to purchase or sell crypto coins at a particular price with the purpose of making profits with the rise or fall of the rate. You can rely on tools, analysis methods and your terminology to trade in cryptocurrency.
Below here are some points which you should know before beginning cryptocurrency trading:
· Know about the cryptocurrency terminology.
· Select a cryptocurrency trading platform and register on different exchanges.
· Know about the terminal and terms of trade
· Make your own strategy for trading cryptocurrency
· Evaluate and select your coin for trading.
· Now, look for entry point (point where you can start a deal). Also calculate and set the highest loss which you can bear for a single transaction.
· Now wait for the price to go according to you and start making money.
How much can you make by trading cryptocurrencies?
Your trading success is evaluated by your expertise and experience. It is when you know how to analyze the market situations and predict the direction in the price movement will take place. Depending on this, a trader with a year of experience can start doubling his amount in every 2 months.
During the learning procedure, you should consider your losses and fees wisely. Make sure you are able to double or triple your capital in a year. And this is not very tough if you plan to join systems like ETFinance.
However, even if you make 50% profit annually, then you have become a great trader. But it is not advisable to ever take money on credit and trade as the risk is really very high and you may not be able to pay your loan amount in the desired time period.
Trading strategies of cryptocurrency
1. A simple working strategy for cryptocurrency trading is to use a graph to check the support and resistance level. Once you understand it, you can know when to open a position and when to close it. With this strategy, you should set a stop loss so that if the trade goes against you, there is only a small loss. Ideally, it is based on the trading volume of the exchange. This strategy is not based on news trading
2. It is suggested not to put pending orders for news-based trading. It may lead to breaking of stop losses. When you trade depending on news, then you should be very alert with smallest updates.
3. A long-term proven strategy is to concentrate on the functional analysis of a particular coin. The entry is based on the stability of the coin and then you can ride the profit according to the news. But for this strategy, you need to have endurance and patience.
For beginners, it is not suggested to go for scalping or short-term trading. This is due to the volatility of the market and the heavy fees which brokerage firms charge. There are a lot of strategies for trading successfully in cryptocurrency. It is up to you to test and try each of them and use them for your benefit.