Thursday, January 27, 2022

Can I Day Trade Bitcoin

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Is Day Trading A Good Way To Make Money

I Tried Day Trading Bitcoin for a Week | Beginner Crypto

Day trading is just one method out of many you can choose for trading. Other examples include swing trading or scalping.

While many people will argue day trading is a good way to make money, more than 90% of people quit day trading in the first 3 months.

Any type of trading strategy can work as long as youre consistent and are willing to put in the time and effort to learn how to be better than other traders out there.

Analyzing Bitcoin Day Chart

Price changes are not linear. That is why technical chart analysis utilizes levels of support and resistance they showcase short-term trends within the overall trend. Resistance shows where an upward trend is expected to pause or rebound. That means that there are many buyers concentrated at that time. Resistance can be used as an exit point for a transaction. A level of support can be used to predict where a downward trend can pause or rebound. This can be used as an entry point.

Levels of support

Why Young Investors Are Drawn To Speculative Investments

The pandemic has been a boon for speculative corners of the market like cryptocurrencies, with 68% of owners having possessed it for less than a year, according to Harris Poll.

And much of that is ownership comes from young investors. Overall, just 13% of Americans own cryptocurrency, but among millennials that number is far higher, at 25%.

Younger investors need money to buy a house or a car, or they want to get married or travel. But some of them saddled with debt or low-income jobs arent setting themselves up to invest for the next 50 years. Theyre doing it for just the next three or four years to cover short-term needs, pushing them to buy speculative assets like cryptocurrency, says Bonaparte.

The fear of missing out is huge. If you want to gamble like in Vegas, only 2% of your portfolio should be in speculative assets, not 100%, Bonaparte says. You can buy cryptos because they have a good run sometimes, but you cant have your entire portfolio in speculation, he says. Thats what were seeing with millennials.

Dan Kearns, whose son Alex committed suicide after he thought he had lost a significant amount of money trading options on Robinhood, agrees with Bonaparte.

Kearns says he believes too many teenagers have become investors by getting caught up in the “outsized influence” of social media and are trying to get rich quick.

“There’s the ‘fear of missing out,’ or FOMO, that seems to rule the day,” Kearns told USA TODAY.”

Also Check: Is Crypto Trading 24 7

Did You Say Automatic

While automatic trading bots might seem like an easy way to drop some funds and rake in the profit, theyre not a guarantee. You could just as easily lose money with the wrong system, wrong programming, wrong commands and some have been known to be scams. Of course, you wont see any of that on the sales page. So, look for people you know who have actually successfully used a specific bot software for a long time before jumping on board .

How To Open An Account With A Trading Robot

Best place to trade Bitcoin futures and swaps? BitMEX and ...

1K Daily Profit is one of the best crypto trading robots.

If you want to to get started trading fast, here are some quick steps to open an account with 1K Daily Profit.

Input your name, email, new password, and phone number. 1K Daily Profit will email you. Click the link in the email.

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Robinhood Crypto And Robinhood Financial

Your cryptocurrency assets arent part of your Robinhood Financial account. Your brokerage account is with Robinhood Financial LLC and allows trading of stocks, ETFs and options, while cryptocurrency trading is done through an account with Robinhood Crypto, LLC. Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services, as well as a number of other state money service business regulators. Robinhood Crypto is not a member of the Financial Industry Regulatory Authority or the Securities Investor Protection Corporation . Cryptocurrencies are not stocks and your cryptocurrency investments are not products protected by either FDIC or SIPC. Robinhood Financial, LLC and Robinhood Crypto, LLC are wholly-owned subsidiaries of Robinhood Markets, Inc.

For these reasons, you can trade cryptocurrencies on Robinhood with a Cash, Instant, or Gold account.

If your Robinhood Financial account is restricted for any reason, your Robinhood Crypto account may also be restricted. You will not be able to trade cryptocurrencies until the restriction on your Robinhood Financial account is lifted.

Your cryptocurrency assets are held in your Robinhood Crypto account, not your Robinhood Financial account, so theyre treated as non-marginable, with a maintenance requirement of 100%. This means your cryptocurrencies need to be backed entirely by cash, and cant serve as collateral for equities positions.

How Much Can You Make Day Trading Bitcoin

US traders will owe the IRS about 25% of all of their profits. When it comes to taxes, software can help, but well discuss this later.

Lets say you buy Bitcoin for $300 and decide to sell it for $400. The profit is $100. You intend to rebuy it when the price drops again and so on and so forth. Your profit would be $75 after taxes. If you used a debit card to buy it, you would have paid fees as well as a markup, reducing the profit to about $48.

If you want to pay lower fees, you can use ACH to buy Bitcoin, but the downside of that is a waiting period of about a week before you can trade. Loading USD into your platform of choice and setting limit buys is the best approach to take.

You can make about $200 a week if youre lucky and day trade BTC worth about $1,000 over this period. This is presuming stability of the price. If it doubles, you can make $1,000.

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Ig Best Crypto Day Trading Platform For Tools And Analysis

IG is a UK-based brokerage site that offers CFDs, forex, traditional shares and funds, managed portfolios, and cryptocurrency trading. You will have access a good selection of crypto-asset CFDs – all of which are traded against the US dollar.

This includes Ethereum, EOS, NEO, Litecoin, Bitcoin and Stellar. There are no commissions to pay when day trading crypto at IG, as everything is built into the spread. This is typically very competitive, with BTC/USD and ETH/USD averages a spread of 36 pips and 1.2 pips respectively.

The IG platform is favoured by technical traders that like to perform in-depth research and analysis. You can also trade via the popular third-party platform MT4. We also like IG as it offers a crypto index that consists of 10 large-cap digital currencies. This allows you to trade the wider cryptocurrency markets as opposed to focusing on one coin.

Pros:

Your capital is at risk.

Wait For The Money Flow Index To Reach The 100 Level

I Tried Day Trading Bitcoin for 1 Week | Beginner Crypto

An MFI reading of 100 shows the presence of the big sharks stepping into the markets. When buying, smart money cant hide their footsteps. They inevitably leave tracks of their activity in the market and we can read that activity through the MFI indicator.

Technical indicators arent always right, so in order to fine-tune our day trading strategy, weve added a few more conditions. Namely, during the current day, we need to skip the first two MFI readings of 100 and study the crypto price reaction.

The price needs to hold up during the first and second 100 MFI reading.

If the price drops after the first two MFI 100 readings, then this suggests that most likely were going to have a down day.

Lets now determine the appropriate place to go buy Bitcoin and what are the technical conditions that need to be satisfied.

See below:

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How To Day Trade

Day trading is extremely simple. By definition, it is a type of trading where you enter and exit a position within the same day. In other words, day traders will buy and sell any number of financial instruments in the span of several hours or less, and profit from speculating on short-term price movements. As we already stated, crypto is well-suited to this thanks to its rapid price movements, which mean you can sometimes make a bigger profit than you would on other financial instruments.

On the other hand, one important aspect of successful day trading is finding a reliable platform that will be able to handle trading in such quick succession. As you have to stay up-to-date on what moves markets in the short term, you may even place hundreds of orders in a single day to profit in the long run. This means you cant deal with a slow, buggy engine or a confusing interface, or even too many non-intuitive options.

PrimeXBT is a platform that removes all of these issues and offers an excellent home for all day traders and those who want to try their hand at the strategy. Also, you know how we mentioned the other asset classes that are popular for day trading? You can trade stock indices, commodities, and forex markets along with crypto using a single account on this trading platform.

Where Can I Day Trade Cryptos

Finding a platform on which to day trade is easy. There are plenty of cryptocurrency exchanges to choose from but, before you sign up for one, carefully check the following:

  • The geographies served. Make sure the platform allows traders from your jurisdiction.
  • Transaction fees. Each platform has different ways of making money off your trades. Even if you have to comb through the fine print, get reliable numbers.
  • Withdrawal fees. You dont want to make a nice little profit only to have much of it disappear as you take the money out.
  • The platforms interface. You want to feel comfortable logging in, looking at the charts, and placing a trade. Check how it looks on all devices youll be using to trade.

Also Check: How To Predict Crypto Charts

Day Trading Bitcoin: Why 95% Of Traders Lose Money And Fail

It is estimated that 95% of traders lose money and yes, Bitcoin is certainly not immune to the same market forces and human emotion.

Almost all traders are aware of the widely publicized statistic that 95% of traders lose money. When you drill deeper, research implies that this number is likely higher. The profession chews up and spits out aspiring traders at an astounding rate.

So why are so many intelligent people drawn to a profession with incredibly high odds of failure?

What Is A Bitcoin Robot

How Much Can You Make Per Day Mining Bitcoins

A Bitcoin robot is an auto-trading software that use complex algorithms and mechanisms to scan the Bitcoin markets, read signals and make decisions on which trades to place in order to provide profit.

As a robot, they are far more effective than humans because they are able to scan all information available on a particular cryptocoin , and execute trades, all in a matter of seconds.

The way robots work is by looking at buy/sell signals. These signals are what allows the robot to be seconds ahead of the market, which means that you will be able to make bigger profits than everyone else. One of such robots is the popular Bitcoin Revolution robot, which boasts an incredible win rate of 99.4%!

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Automated Trading On Exchanges

An alternative to using a bot is to use the copy trading feature on eToro – this FCA and CySec regulated cryptocurrency exchange allows you to replicate the trading decisions of a winning, profitable trader of your choice, or a combination of several.

InsideBitcoins recommends diversifying your portfolio by allocating part of your funds into a long-established, safe and reputable platform such as eToro – never invest 100% of your cryptocurrency into one trading bot or hold it on one website, broker or exchange. Start with a minimum deposit on any platform you use, and make a small withdrawal as a test.

Coptrading on eToro is similar to using a bot in that you can grow your investment without having to monitor it, trade yourself or make any decisions – all buy, sell, take profit and stoploss orders are automated.

eToro – Automated Copytrading of Profitable Traders

Our Rating

Forexcom Best Crypto Day Trading App

Although Forex.com is best known for its currency trading department of more than 80+ pairs – this popular broker is also home to cryptocurrencies. As crypto markets at Forex.com are traded as CFDs, you can go long or short and even apply leverage.

You can trade the likes of Bitcoin, Ethereum, LTC, and Bitcoin Cash against the US dollar. You can also trade Bitcoin against the euro, pound sterling, and Australian dollar. When it comes to fees at Forex.com, this depends on your chosen account type.

There is a commission-free account with reasonable spreads – which is best for casual traders. If you’re a professional trader, then the STP Pro account will be more suitable. This allows you to trade with industry-leading spreads alongside a small commission. If funding your account with bank wire, there is no minimum deposit thresholds.

Pros:

There is no guarantee you will make money with this provider.

Recommended Reading: How To Buy Crypto With Amex

Final Thoughts On Robots

To conclude, if you’re looking to trade cryptocurrencies, stocks, forex or even cannabis stocks, a robot is a good choice. The technology behind them is based on algorithms which means that nine times out of ten, they will make better choices than humans. Automated trading robots have shown that you don’t need to be an expert to be able to make a side income. The one we recommend you start with is Bitcoin Revolution.

However, when trading with bitcoin robots, or regular autotrading robots, we strongly recommend that you do your research beforehand. Is the robot legit ? Does it have a professional website? Are there testimonials you can read? Is there information on the web about the founder, and how the software operates? These are questions that you should ask yourself before investing.

Only once these answers have been provided should you invest.

  • Robot

How Do I Choose A Trading Robot

I Tried Day Trading Bitcoin for a Week | Beginner Crypto

Similarly to bitcoin robots, there are also a lot of trading robots scams going around the web.

The trading robots below rated as good and okay are those that InsideBitcoins has verified to be legitimate. Those with insufficient rating may be legitimate, but we have not found enough evidence to this effect and we think that may be scams. Read our comprehensive trading robots reviews to learn more by clicking on the brand name.

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What Are The Risks

When it comes to risks, investing alone is one because youre not guaranteed to generate a profit and the value of your assets could fall.

If youre choosing Robinhood so you can trade stocks and cryptocurrencies – then the game gets even riskier.

Cryptocurrencies are not only difficult to understand but even tougher to predict when bearish trends in the market will take place.

For example, cryptocurrency was thriving this year up until Elon Musk said that Tesla was halting the acceptance of payments in Bitcoin.

Since then, the crypto spaced has endured volatility.

For investing individual stocks, make sure you check company reports, Securities and Exchange Commission filings, broker notes, and press releases so you can make the best decisions for your money.

Another risk when choosing Robinhood along with other brokers is that they can restrict trading when theres unusual activity.

In fact, Robinhood faced some outrage earlier this year when it restricted trading on meme stocks including GameStop and AMC.

In July, the platform was also ordered to pay nearly $70million in fines and compensation for misleading customers and outages.

If you are seeking a discount broker and are looking to open an IRA account, you can check out the following platforms: Vanguard, Fidelity, TD Ameritrade, Merrill Edge, among others.

For other relevant explainers, we show you how to invest in the S& P 500 and gold.

Are Bitcoin Robots Scam Or Legit

As you can see, most brokers behind auto-traders are questionable. so InsideBitcoins has tested and verifies brokers based on their years of experience and reputation.

While not all Bitcoin Robots are legit, the concept behind the robots, in general, is legitimate. A good bitcoin robot should be able to beat the markets most of the times and generate considerable returns for the traders. Most crypto-traders in the market today promise investors to make thousands of dollars per day with an initial investment of as little as $250. These results may be achievable with some but not always.

Do not subscribe to a bitcoin robot with the mentality that you will get rich quickly. With some robots, the profits may be small at the beginning but will increase as you upgrade your account. InsideBitcoins reviews give you a true picture of what to expect with different bitcoin robots regarding profitability.

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The Difference Between Buying And Trading Bitcoin

Its easy to get confused between buying and trading bitcoin. This isnt helped by the fact that even specialists conflate the two ideas. To ensure that you know exactly what trading bitcoin entails, our experts have created this simple explanation:

  • Buying bitcoin is a long-term endeavor, which is why its associated with investing. People buy BTC, hold on to it for months or years and then usually sell it for fiat in the end.
  • Bitcoin trading is a short-term endeavor. When you trade bitcoin, you are essentially speculating whether or not the price of the asset will fall or rise. You dont own bitcoin yourself but instead profit from these price movements.

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