Crypto trading is one the fastest way that people benefit from when it comes to blockchain activities.
Although there are other ways of making fast money in the world of cryptocurrencies, the most lucrative way to earn is through trading.
However, trading is not for Newbies, this is because it involves high financial risk. It is very dangerous to go into cryptocurrency with the intention of benefitting from trading.
As a beginner, you should monitor the activities of the crypto world before you finally make up your mind on trading.
In the period of monitoring cryptocurrencies activities, you should engage is breath taking research, the more you read about the field you want to go into, the more it gives you the idea on what to do.
What then is Crypto Trading?
Crypto trading can be referred to as the process of buying and selling of cryptocurrency.
Every trading involves transaction between two parties, the parties involve has to exchange a tangible asset before trading can take place, on that note, Crypto trading involves the process of exchanging a crypto coin or digital assets with another tangible asset.
There are a lot of benefit in crypto trading, paying attention to the ideas and strategies in crypto market can make you smile home with a pocket filled with gold.
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Steps to note before starting cryptocurrency trading
The Crypto market is a market that is filled with uncertainty from inception of the first cryptocurrency in 2009, when crypto activity came to light till date.
Digital asset enthusiast have witnessed fluctuations in prices of cryptocurrencies and they have come to embraced the inconsistency in the crypto space.
Research on crypto trading
The worst mistake that beginners make is starting crypto trading without knowing the pros and con of the crypto market, it is recommended that you do a thorough research before start trading.
Even in the physical world, it is said that, “he who fail to plan, plans to fail” what this means is that a trader who focus on marketing strategy always gets a good profit at the end.
Research on how Crypto Fear and Greed Index works and make sure to use it to your advantage.
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Create an Exchange Account
There are so many exchanges in crypto, an exchange is used by a trader to trade, it is a platform provided for traders that enable them to carry out their trading activity.
To become a trader, you must have an exchange account, regardless of the types of exchange you choose, the process is the same.
You must start with opening an account, after creating your account, you will be required to complete you KYC registration, KYC (know your customer) registration helps to verify your identity.
There are however some anonymous exchangers that allow users to trade without KYC registration.
Fund Deposit
After completing your KYC, the next step Is to make your first deposit into the exchange.
The first deposit should be an amount that will not affect your financial strength. it is recommended to deposit an amount that you can spare, this is because of how volatile the crypto market is.
There are different methods on how to deposit into your exchange, it can be through credit card transaction option.
This is done by using your credit card to send money into your exchange wallet, through fiat or bank deposit; this is done by performing a physical deposit to the bank account the exchange company will provide.
when this done, the money will be added to you exchange account, or through cryptocurrency deposit; this is done by sending funds from an external wallet to the exchange you intend to use for trading, to do this, you will copy the address of the exchange you intend to use for trading and paste it as a recipient on the wallet you want to send from.
For instance, you can copy your Binance wallet address and use it to receive Ehtereum in Roqqu wallet, once the transaction is confirmed on Roqqu wallet, your Binance wallet will be credited.
Start Your First Trade
After choosing your preferred digital asset and researching about it, you place your first order, to do this, you set a buy order at a specific price and wait for the marching of the order.
If the sell order resonates with the order you set, the exchange automatically matches your order, and that completes the transaction.
Note that to start your first trading is to be ready for the flexible nature of the crypto trading market.
The three main strategies in Crypto Trading
There are a lot of Trading Strategies in Crypto, a good trader can easily develop a new strategy that will benefit him, each strategy can be changed because of the volatile nature of the crypto market.
Three of the Strategies to consider as a new trader are mentioned below.
- Day Trading
This is a type of Crypto Trading that involve the buying and selling of cryptocurrencies for more than one time in a day, that is, a person keeps buying and selling without minding what will happen or how dangerous and risky it is.
People who always use this type of trading strategy are those that have an active mind and are good in developing a good critical thinking capacity to solve complex puzzles, you need to think deeply to be able to use this type of strategy in Crypto Trading Market.
- Swing Trading
In this type of trading a person hold onto a coin for some time and then sell it off when the price is has increased.
Traders who are patient and understand the market can use this type of trading strategy, this is because, when a person understands the market, he will know when they will likely be an increase in price, so he will wait until then to sell it off and to make benefit from it.
- Positional Trading
This are trading strategies that involve holding unto the currency for a very long time and then sell it off, positional trading strategy is longer than swing trading, but one feature that is similar among the two strategies is that it requires a patient trader.
Which Strategy should a beginner use
Looking at the how risky and volatile the crypto market can be sometimes, a beginner is expected to choose which carefully, which of the strategy that can reduce the level of risk in the trading market.
Looking at the explanation of the three crypto trading strategies above, the only strategy that is recommended for a beginner is the swing trading, he does not need to trade multiple times in a day, but to buy it and hold for some time and sell it off.
The Best Strategy for experience Traders
To talk about experience traders is to talk about those that are experience in the crypto market and how volatile it can be.
An experience trader can use any of the three strategies, it all depends on how he can manage his patience banks so that he will not fall a victim to the market risk.
It can be summarize that the more profitable a strategy is, the riskier it is, for example; the Day Trad bing has a high risk involve in it, but a trader that understands the market can make a fortune from it, this is because even as the trader is buying multiple times in a day, he know when exactly to sell it off and make profit from it.
Final Note
One of the things that can will make you to be a victim of the unstable market in the crypto is when you involve emotion in the process of trading, to explain this;
when you fall a victim the first time and loose some money, do not rush to trade immediately so as to recover what you have lost, doing that will expose you to more lose, study the market give some time before you trade again.