Bitcoin Trading Guide for Beginners:
Trading is the process in which traders buy at a cheap price and sell at a high price. You can understand the Cryptocurrency market in many ways, so the first thing is to learn basic things from the market.
- To trade in Cryptocurrency, you need to open an account on a Cryptocurrency exchange.
- Verify all the details that are needed.
- Deposit money to your trading account.
- Let’s start your first trade on the Cryptocurrency exchange.
Investing vs Trading In Cryptocurrency
You can invest, or you can trade in Cryptocurrency. Invest is for the long term, and trading is for the short term.
The best traders and investors know that patience is the key to making it successful.
1. Cryptocurrency Investment
In Bitcoin, many people believe that the price will ultimately rise because they believe in the technology, ideology, or people behind the Cryptocurrency. Many people who invested in bitcoin in a few years become rich. They all invest for the long term, not for the short term. This is the philosophy for investing. First, bitcoin is very volatile. In other words, you can make a nice profit if you manage to correctly anticipate the market. Second, traditional markets have particular opening and closing times such as stocks and commodities markets, while Bitcoin trading is open 24/7. With Bitcoin, you can buy and sell whenever you like. Bitcoin is unregulated in most countries makes it relatively easy to trade with no identity-verification processes.
2. Cryptocurrency Trading
There are two methods used to analyze Cryptocurrency price:
Fundamental analysis refers to accounting and finance. Fundamental analysis tries to predict the price by looking at the big picture. In Bitcoin, for example, the fundamental analysis estimates Bitcoin’s industry, news about the currency, technical developments of Bitcoin (such as the Decentralize network), regulations around the world, and any other news or issues that can affect the regulation of Bitcoin.
For example, China instantly decides to ban Bitcoin in the year 2017, which results in a sudden price drop. Good news also matters to increase prices like Bitcoin hard fork and regulation of bitcoin by any country.
Technical analysis is a trading discipline by analyzing statistical trends gathered from trading activity, such as price movement and volume. It has many tools like OBV, RSI, MACD, and the most famous is the Japanese candlestick.
Technical analysis Tries to predict the price by studying market statistics, such as past price movements and trading volumes. It tries to identify patterns and trends in the price and based on these deduce what will happen to the price in the future.
Which strategies are better?
We discuss both strategies technical and fundamental. The simple magic of trading is a mix of both strategies will probably yield the best results.
We can start Crypto trading in two ways
This method involves conducting multiple trades throughout the day and trying to book profit from short-term price movements. Day traders spend a lot of time beginning at computer screens, and they usually just close all of their trades by the end of each day. Picking up pennies Crypto coins, Scalping concentrates on extremely short-term trading, and it’s based on the idea that making small profits repeatedly limits risks and creates advantages for traders.
This type of trade tries to take advantage of the natural “swing” of the price cycles. Traders try to identify the beginning of a specific price movement and enter into the trade. Swing traders try to see the big picture without constantly monitoring their computer screen For example, swing traders open a trading position and hold it open for weeks or even months until they reach the desired target.
Basics of Trading
The Order Book is the complete list of buy orders and sell orders are listed in the market’s order book, which can be viewed on the trading platform. The buy orders are called bids since people are bidding on the prices to buy cryptocurrency. The sell orders are called asks, since they show the asking price that the sellers request.
As here in the image Top10, cryptocurrency volume is given. This will help you find the Trends of the price. You can decide the price is going up and down by the trading volumes. It is an important factor. While weak trends are shows by low volumes. For example, high volumes will show an upward trend when the price rises, and price declines show the low volumes.
Every trade has a price break-out. We can identify stop loss by the historical graph. For this open the weeks and days chart.
Now you’re familiar with the Basic of trading
Read the Price Charts
It’s time for a short intro to reading price graphs. Japanese Candlesticks a very widely used type of price graph, Japanese candlesticks are based on an ancient Japanese method of technical analysis. Each “candle” represents the opening, lowest, highest, and closing prices of the given time period. Because of that, Japanese Candlesticks are sometimes referred to as the OHLC graph (Open, High, Low, Close). It depends on the candle is green or red, you can tell if the closing price was higher or lower than the opening price. If a candle is fully green, it means that the opening price was lower than the closing price. If it’s a bear market, most of the candlesticks will be red. Bull and Bear Markets These terms are used to show the general trend of the graph, whether it’s going up or down.
Is Crypto Trading Profitable
Trading or investing in cryptocurrency can make a great profit. It’s also highly risky or high rewarding. You can win and lose a large amount of currency immediately. This all depends on you. Make a good strategy and don’t go with loss always stay with profit.
- First, you make your own strategy to trade in cryptocurrency.
- No one can explain to you how to make money with trading.
- First, you have to learn after you can start to earn.
- Before you invest, proper risk management is more important than making money.
Is it possible to predict the future? Answer me with a comment.So we can’t predict any cryptocurrency price.