Sep 26, · Before day trading Bitcoin or any other alt coins, it’s also important to check how liquid the cryptocurrency you wish to trade is. You can do so by simply verifying the hour volume of the crypto trade. CoinMarketCap is a good free resource to read and gauge the market volume of /5(). The Impact of day trading Bitcoin rules. For a something profoundit Understanding, how day trading Bitcoin rules in fact acts, a look at the scientific Lage regarding the Ingredients. This task we do already performs. Look we the Manufacturer information to Effect to, is the Analysis the User reports. For Day trading rules Bitcoin, you don't have to realise computer computer programming to realize that phytologist, businesses, the bold, and the brash are cashing linear unit on cryptocurrencies. This templet will help you to get started, but e'er call up that Bitcoin investing carries a highschool degree of speculative risk.
Rules for day trading bitcoinLearn How to Day Trade Bitcoin: a Guide with Winning Trading Strategies
Although none of the major cryptocurrency exchanges offer a demo account, a good place to start would be Coins2Learn. Coins2Learn offers a trading simulator that allows you to trade using fake money. The platform is really good for beginners and they even offer tips and how to become successful. You can access their website by clicking this link! Once you have a better understanding of how the markets work, the next step is to do the real thing.
This is why it is important to start off with really low amounts. In fact, the amounts must not be any larger than you can afford to lose. At this stage of your day trading cryptocurrency career, you will be learning about the highs and lows of the markets and most importantly, improving your skills and knowledge. Once you have figured out how the markets work and you feel you are ready to start trading with real money, you now need to set yourself some targets.
This is really important as if you are planning to do this as your part-time or full-time job, you need to have expectations as to how much you hope to make. These traders will have a very large "bankroll", meaning that they can still make good money even if the percentage gains are small. Although this sounds like a small amount, in the long run, this will protect you from going broke. Another important aspect to day trading cryptocurrency is that you set yourself a stop loss.
A stop-loss is when you enter a price that you want to automatically exit your trade. This protects from you a sudden decline in price, or if you were not at your computer to do it yourself.
If you feel that you will not have the mental desire, time or patience to become a day trader, you could always consider long-term investing instead. Long-term trading is far less stressful, as once you buy a coin you can leave it to grow over a longer period of time. This could have been achieved without you needing to sit at your computer all day to check for any price movements.
You can also apply the same trading techniques too, such as setting stop-losses or market limit-orders. However, if you are certain that you want to become a cryptocurrency day trader, then the next part of my guide is going to show you how to get started!
Looking for more in-depth information on related topics? We have gathered similar articles for you to spare your time. Take a look! Learn how to make money with Bitcoin in the latest making money with Bitcoin guide. Trezor VS Ledger: the complete overview of the two hardware wallets. Now that you know what day trading cryptocurrency requires, as well as what you need to consider, I am now going to show you how to get started!
The first step when looking at how to day trade cryptocurrency will require you to find a good exchange. A cryptocurrency exchange will allow you to buy and sell coins 24 hours per day. It is important to think about what kind of cryptocurrencies you are looking to get involved with.
If you are looking to day trade full time, then it is well worth choosing an exchange that has lots of difference pairings listed. Note: A pairing refers to the two coins that are being traded. It is also important to find an exchange that has lots of liquidity. This will ensure that you can always be matched with a buyer or seller, otherwise, you might not be able to close your trade when the price is falling!
A good place to start would be Binance, as they have hundreds of trading pairs available and they also have one of the largest trading volumes in the market. To find out more information on setting up an account at Binance, see my guide here! Once you have opened an account with an exchange, it is time to deposit some funds. If the exchange that you want to use does not accept real-world money deposits, then you can first go to Coinbase to buy some Bitcoin or Ethereum and then transfer it across.
You also need to consider how much you are planning to deposit. Never forget that the cryptocurrency markets are really volatile, so there is always a chance you could lose your entire investment. Start off with smaller amounts first. Once you are set up and you have deposited some funds, take some time to understand the different features on the trading screen. Every exchange will have a chart, so it is a good idea to learn how to analyze pricing movements.
You can visit their free guide here. The green bars mean that the price has gone up, while the red bars mean that the price has gone down. Learning how these tools work is really important as it will allow you to identify when there is a good chance that a coin is going to rise or fall.
However, once again, there is no guarantee that your prediction will be right, so always make sure you are ready to exit a trade if things go badly! I know I have given you lots and lots of information, but I think it is really important for you to understand all of the risks involved.
If you have read my guide from start to finish, you should now know whether day trading is right for you, as well as how to trade Bitcoin, and how to trade cryptocurrency in general. As you have probably noticed, there are a lot of steps to consider before you begin your trading career.
In reality, it will take a really long time before you are able to trade successfully as if you do things correctly, you will need to build things up slowly. However, a trading bot is as good as the technology behind it. When you choose the automated trading platform by 3commas, you get a robust platform, with no downtime and technical hiccups.
And considering you can share and learn strategies, indicators, and settings with other traders in the community, your trading improves even further. All trading charts show data points for the past and current price movements. A Bitcoin day chart focuses on its price action for a specific day. You can also view changes within a specific timeframe, which helps traders make more informed decisions.
Whilst there is no shortage of line and bar charts, one of the most valuable types is the candlestick chart.
It offers plenty of valuable information in a concise form. Here is what the chart can tell you:. There is a lot more information to extract, which will hold significance in your trading. Trends show the momentum of Bitcoin price changes in a particular direction. You can identify these patterns on a chart and make decisions based on that data. Peaks in an uptrend and throughs in a downtrend form a trend channel, which is a commonly used concept in the technical price analysis.
The channels show where Bitcoin is trading at a particular time and compares it to the overall direction. 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. Market orders are the fastest way to enter or exit a trade at the best price available at the time. However, instant execution means that the price becomes secondary. When you place a limit order, it will only be triggered once Bitcoin reaches the price you set. Thus, you may get a better price if you are patient enough. Bear in mind that the price should be profitable for you but still realistic. The limit order will not be executed until there is a seller or sellers willing to accept the price that matches yours.
If the market price is lower, it simply will not execute your order. But what about crypto day trading? Our team at Trading Strategy Guides is lucky to have over 50 years of combined day trading experience. So, you need a day trading cryptocurrency strategy to protect your balance. The high volatility nature of Bitcoin and other cryptocurrencies has made the crypto market like a roller-coaster.
Otherwise, your experience can be like skydiving without a parachute. Day trading the cryptocurrency market can be a very lucrative business because of the high volatility. Since the crypto market is a relatively new asset class, it has led to significant price swings.
The good news is that even when we have a low reading of volatility relative to other asset classes, this volatility is still high enough that you can generate a modest profit on your trades. You can do so by simply verifying the hour volume of the crypto trade. CoinMarketCap is a good free resource to read and gauge the market volume of any particular coin.
We only like day trading cryptocurrencies when all the conditions align in our favor. In this case, avoid trading on weekends and limit trading only on the highest-volume days. The idea behind crypto day trading is to look for trading opportunities that offer you the potential to make a quick profit. Now, before we go any further, we always recommend taking a piece of paper and a pen and note down the rules of this scalping strategy.
As previously discussed, the number one choice you need to make is to pick coins that have high volatility and high liquidity. There are more than coins on the market and growing. Day trading smaller cryptocurrencies can also be a very lucrative business, but there are higher risks. Remember, crypto prices can crash just as fast as they have risen. 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. An MFI reading of shows the presence of the big sharks stepping into the markets. They inevitably leave tracks of their activity in the market and we can read that activity through the MFI indicator.
Namely, during the current day, we need to skip the first two MFI readings of and study the crypto price reaction. We can now wait for the third MFI reading above The close of this candle needs to be near the upper end, giving us a candle with very small wicks.
This brings us to the next important thing that we need to establish when day trading cryptocurrency, which is where to place our protective stop loss and where to take profits. The obvious place to hide your protective stop loss is below the low of the day. This can also signal a reversal day. However, the only rule you need to abide by is to take profits during the first 60 minutes or the first hour after your trade got triggered.
Holding the trade longer than one hour will result in a lower success rate. If you took the time to read the whole day trading crypto guide, then you should be able to buy and sell Bitcoin and alts and make some daily profits. If you are interested in learning how to day trade cryptocurrency , be sure to equip yourself with enough information before diving into the market.
Making a living day trading cryptocurrency can be a lot easier due to the high volatility nature of the crypto market.