Wednesday, August 10, 2022

Should I Day Trade Crypto

The Logical Trading Progression

I Tried Day Trading Bitcoin for a Week! Margin Trading Crypto

Many new traders go through a typical logical progression with cryptocurrencies. They start with something simple like Cash App or Coinbase to buy and trade a small number of cryptocurrencies . Once they are comfortable with these easy entry points to crypto trading they begin to look into the full featured exchanges such as Binance and Coinbase Pro. This gives them a far greater selection of crypto assets, as well as introducing them to technical analysis tools and charting tools.

As you advance youll get access to a broader group of cryptocurrencies and analysis tools.

While thats as far as some traders go, others continue exploring and move on to the centralized exchanges such as Uniswap or PancakeSwap. In addition to using these decentralized exchanges this is also the level at which traders begin looking into yield farming or the use of leverage and derivatives in their trading.

This logical progression lets you gradually build on learned skills, and taking these steps out of order could lead to problems, so try not to run before you can walk.

Another good idea along the way is to educate yourself about other areas of the crypto investing universe such as mining and staking. And of course youll want to educate yourself on the basics of how blockchains work and how smart contracts work, as well as other technical aspects of blockchain operations. Of course you can do all of that here at the Coin Bureau blog and over at our YouTube channel.

Can You Short Crypto

Yes, you can short cryptocurrencies online. With that said, the easiest and most cost-effective way of doing this is to place a sell order at a crypto CFD site. Some of the best platforms supporting crypto CFDs include eToro, Libertex, and AvaTrade.

About Kane PepiAbout Kane Pepi

Kane Pepi is a British researcher and writer that specializes in finance, financial crime, and blockchain technology. Now based in Malta, Kane writes for a number of platforms in the online domain. In particular, Kane is skilled at explaining complex financial subjects in a user-friendly manner. Kane has also written for websites such as MoneyCheck, InsideBitcoins, Blockonomi, Learnbonds, Buysharesand the Malta Association of Compliance Officers.

How To Start Trading

As you are looking to trade cryptocurrencies, the first thing we need to do is get you some coins! The easiest way to do this is with Bitcoin, as almost every exchange accepts it.

If you decide to buy Ethereum instead, then you can still follow the guide below. However, wherever Bitcoin is mentioned, swap it for Ethereum.

If at this point you already have Bitcoin, you can skip to the next part of the guide!

The quickest way to buy Bitcoin is to use your debit or credit card with Coinbase. Coinbase are an exchange broker and will sell you Bitcoin at a really good rate. Although there is a 4% charge to use your card, it is worth it as you get your coins straight away.

Pros

  • Can be managed from mobile device
  • Very secure

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Open An Account At Coinbase

Go to the Coinbase website by . You will need to choose a username and a strong password. You will also need to confirm your email address and mobile number.

Verify your account at Coinbase

Before you can buy Bitcoin at Coinbase, you will need to verify your identity. Follow our step-by-step guide below.

  • Click on Buy/Sell at the top of the screen.
  • You now need to add a payment method. Click on Add Payment Method.
  • You will then be asked if you want to add a bank account or a debit/credit card. In this example, we will add a debit/credit card as it is the quickest way to deposit.
  • As Coinbase takes security very seriously, you will now need to verify your identity. Click on Upload ID.
  • You can upload either a passport, drivers license or a government-issued ID card. Click on the one that you wish to upload.
  • Next, you will be asked how you want to upload your ID. You can choose a webcam, mobile camera or a file upload.
  • Once you have uploaded your ID, you will get the below confirmation.If the picture quality if not clear enough, you will be requested to upload it again. Add your payment method in Coinbase
  • You will now need to enter the billing address for your debit/credit card.
  • Now you will need to enter your debit/credit card details. Dont worry Coinbase never gets to see your card details as the numbers are encrypted.
  • Congratulations, you have now verified your identity and added a payment method! Now, lets go and buy some Bitcoin.
  • Buying Bitcoin at Coinbase

    How To Trade Cryptocurrency With $100

    Should I Trade Cryptocurrency or Stocks?

    Even if you think that trading cryptos with a small account is worth it, are you mentally and financially prepared to start trading?

    Well, whether you decide to start trading cryptocurrency with $100 or $100,000, you should invest enough time in exploring the complexities of crypto trading. One should invest in proper trading education in order to create a successful trading strategy. From online courses to webinars, make sure you understand the basics of cryptocurrency and blockchain technology.

    Traders should be patient and give themselves enough time to establish a successful trading strategy. No surprise that practice means a lot. As trader Scott Melker, known as the Wolf of All Streets, said, Its almost like this long-term mathematical formula. If you execute, and you do it long enough, you just win a little more than you lose.

    The ability to read charts, historic data, price predictions, and technical indicators is crucial. Traders should also make a habit of following the news and social media announcements to seize the best trading deals. When new crypto forks appear, for instance, traders may even get free tokens.

    On top of that, cryptocurrency traders must develop consistency and self-control. Emotional self-control is, in fact, a fundamental factor in cryptocurrency trading success. Theres no place for greed, fear, or overconfidence in the world of trading.

    Recommended Reading: How To Buy Crypto On Binance

    Trading The Relative Strength Index Divergence

    Level: Intermediate Advanced

    Another reversal signal comes from the divergence between the price movement of a cryptocurrency and the RSI line. For those unfamiliar, the RSI is an indicator of overbought and oversold levels.

    A bullish divergence occurs during a downtrend when the cryptocurrency price declines, creating lower lows, while the RSI score increases and displays higher lows. That means the downtrend is probably reversing, and an uptrend is coming. Conversely, a bearish divergence forms when the price increases while the RSI indicator drops.

    How To Use Fibonacci Retracement In Trading

    When prices are near Fibonacci Retracement levels, traders are looking for confirmation whether the level will hold or not. For example, high volume near level and big candle towards previous peak could mean that level holds. On the other hand, small volume and small bounce from the level would not be considered as trend continuation.

    Several examples of Fibonacci Retracement levels usage in crypto trading below:

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    Apply The Money Flow Index Indicator On The 5

    This specific day trading strategy uses one simple technical indicator, namely the Money Flow Index. We use this indicator to track the activity of the smart money and to gauge when the institutions are buying and selling cryptocurrencies.

    The preferred settings for the MFI indicator are 3 periods.

    How to use the IMF indicator will be outlined during the next step.

    See below:

    How To Start Day Trading Bitcoin And Other Cryptos

    How Should I Trade: Forex vs. Crypto vs. Options? ð
  • Know all the ins and outs of the market and bitcoin or any other cryptocurrency to become a successful day trader.
  • Open an account in a suitable bitcoin trading exchange that meets your day trading needs.
  • Deposit an initial investment capital and kick off your day trading journey.
  • A trader must know all the ins and outs of the market and bitcoin or any other cryptocurrency to become a successful day trader. Usually, the idea is to purchase a cryptocurrency whose price is likely to rise over the next few hours and then sell it to earn profit. Although this might seem easy to beginners, cryptocurrency trading is demanding and risky. It takes massive discipline, knowledge, and dependable cryptocurrency day trading strategies to succeed.

    To get started, you need to open an account in a suitable bitcoin trading exchange that meets your day trading needs. Notably, the crypto market is incredibly fragmented, and exchanges operate under multiple jurisdictions scattered worldwide. Having that in mind, you need to select a crypto exchange platform that is supported in your country.

    After choosing a reliable crypto exchange, the next step is to deposit an initial investment capital and kick off your day trading journey. However, it would be best if you had a reliable day trading strategy to succeed. So, what are the best bitcoin day trading strategies?

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    Know Your Crypto Lingo

    There is a lot of jargon out there in crypto land and often it can be difficult to decipher.

    Use this helpful list to make the most of the best crypto tips and dodge common cryptocurrency mistakes that could blow up your trading account.

  • AltcoinA portmanteau of alternative and coin, altcoin refers to any cryptocurrency other than the original one, bitcoin.
  • Cryptocurrency exchangesJust like regular stock exchanges, the likes of Coinbase, Binance, Gemini and Bitstamp allow traders and investors to buy and sell except that here they are trading cryptocurrencies. Unlike standard stock markets, cryptocurrency exchanges are online-only and are open 24 hours a day, 7 days a week.
  • LimitsMost exchanges do not set limits or restrictions on the number of cryptocurrency trades their users can make in a day. On turbulent trading days, when cryptocurrency prices are moving up or down very quickly, some brokers may put a short-term halt on people depositing funds on their platforms.
  • ShortingShorting cryptocurrency means betting on the price going down rather than up.
  • ForksA cryptocurrency fork is a split in a blockchain where two separate blockchains are created. This is sometimes but not always because of a disagreement between developers as to how the blockchain should be organised. In 2017, bitcoin forked into two separate blockchains: bitcoin and bitcoin cash.
  • So Which Is Better Robinhood Or Coinbase

    When it comes to cryptocurrencies, Coinbase is the clear winner here. While its fees can be confusing and high, the option to trade on Coinbase Pro once you have a little experience can bring those fees down. Robinhoods free trading is nice, but it doesnt make up for the lack of crypto capabilities and the shortlist of cryptocurrencies to invest in.

    But if all you care about is speculating on the price of cryptocurrencies and you have no intention of actually using the coins and tokens you buy then Robinhood could be a better fit, given the free trades.

    Read Also: How To Gain Profit From Cryptocurrency

    Thoughts On Day Trading

    Dont dismiss this system because its simple. I have made a career out of this type of thing.

    Many traders choose to fill up their charts with all sorts of things. Trendlines, support resistance levels, fib levels, MACD, RSI, etc

    When you’re day trading you need to be able to think quickly, and if you’re processing too much data or metrics it is going to confuse.

    Day trading is hard enough because you can spend long hours at the pc, waiting for a setup to come along. This can lead to lapses in concentration.

    After sitting for hours, worrying when a setup will come along, and questioning whether you are going to make money that day it’s easy to start placing trades you shouldnt.

    Also, trading is the most emotional type of trading there is. Money can be made, and lost in record time, which can lead to overconfidence or fear of the market.

    You need a clear head when day trading cryptos.

    If you win money quickly, you can become greedy. If you lose money too quickly it can start you on a path of revenge trading.

    Yep, day trading is hard but is also why we are compensated so highly for it.

    Indirect Solutions For Crypto Trading

    How To Day Trade Crypto For Beginners

    While things are getting better in terms of access and removing restrictions on cryptocurrency exchanges, there will likely still be some of you out there who will either have difficulty dealing with a traditional centralized exchange, or simply dont want to deal with one of these exchanges. Fortunately there are still some options that you could explore.

    There are plenty of cryptocurrency exchange alternatives to choose from.

    If you still want to buy actual cryptocurrency you could try Squares Cash App, which is a particularly good way to avoid using Coinbase if you are just interested in buying and selling Bitcoin. This is also a good option if you need to buy some Bitcoin to deposit to another exchange for trading.

    Some other options for very basic crypto trading include Robinhood and Paypal. The downside to these options is that neither allow you to withdraw crypto from their platform, and youll only find a handful of the largest cryptocurrencies to trade.

    The upside to using Robinhood is they also offer access to equity markets, meaning you can take an even more indirect approach to crypto trading through the various Greyscale Trust products, or through trading stocks that are related to crypto, such as Coinbase, Bakkt, or Riot Blockchain.

    Recommended Reading: Why Should I Buy Cryptocurrency

    How Does Wealthsimple Make Money From Wealthsimple Crypto

    Wealthsimple Crypto makes money from the price spread. When you submit a purchase or sell order, you will see two prices the current price of the crypto-asset and a slightly higher transaction price. The difference between these two prices is known as the spread and includes the cost to custodian Gemini Inc., the liquidity providers, and the operational overhead for Wealthsimple.

    Ces 202: Ces Confirms In

    “One of the main ways that traders lose money is by losing discipline and chasing losing trades or by doubling down’ on positions that are going against them,” he said

    “This is the market controlling you and taking your money right in front of your eyes.”

    Traders should choose their marketplace carefully and make sure liquidity, reliability, and if possible market regulation is at the top of their list before entering any trade.

    When entering a trade, traders are advised to identify their entry price, stop loss level, and target price.

    Do not enter a trade without a stop-loss, without fail, DailyFx said. Even better if your provider can offer you a guaranteed stop-loss normally for a small premium you should consider it carefully.

    Traders should also consider Contracts for Difference very carefully before using them. The market has enough volatility of its own and will continue to offer opportunities to trade profitably.

    Read Also: Where To Buy Chia Crypto

    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.

    America Lags Other Countries In Financial Literacy

    Day Trading Crypto for Beginners Using Trading Bots 2021

    Part of the issue with retirement planning and investing, experts say, is that Americans aren’t equipped with much financial education since most states don’t require financial literacy classes for high school students.

    As of 2020, 21 states required high schools to teach financial literacy, and 25 states required a high school economics course, according to the Council for Economic Education.

    Each year, Americans graduate high school without knowledge of basic life skills like how to keep a budget, file taxes, open and maintain a bank account and save for retirement, according to Bonaparte.

    That’s added to a staggering dilemma where two-thirds of states 35 states including Puerto Rico and Washington, D.C. earned grades of “C” or less for financial literacy instruction, with just 17 states earning grades of “A” or “B,” according to a study released by the American Public Education Foundation in 2021.

    The U.S. ranks 14th in the world for the percentage of financially literate adults, with only 57% of them meeting that standard, according to Standard & Poors Global Financial Literacy Survey. Countries with the highest rates include Australia, Canada, Germany, Israel, and the United Kingdom, where about 65% or more of adults are financially literate.

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    Treat Trading As A Business With Mitrade

    Successful trading is a business, not a hobby. Like any business, you have profits and expenses. How you manage them both determines how far you go.

    Nowhere is this truer than when day trading forex or CFDs.

    Day trading cryptos offer fantastic rewards, regardless of whether it goes to $100K or never again goes about $20k.

    The volatility in this asset class is truly immense and it is a day traders dream.

    Have you ever known a business that required no customers, no selling, was location independent, no stock purchases and no marketing?

    Have you ever known a business that was location independent and didn’t require a special business premise? Or that didnt require a special license? Or one where you could make up your work hours?

    There is no business in the world like that, except one. Trading.

    Here at Mitrade we want to help you make your trading journey both as enjoyable and as profitable as it can be.

    Day trading cryptocurrencies CFDs is just one of several routes to do that.

    Happy Trading.

    Start Trading Today

    Mitrade is an ASIC-regulated broker. They provide reasonable leverage based on different trading instruments. Also, Mitrade provides you protection against negative balances, allowing you to control the trading risk and trade with peace of mind.

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