Dec 16, · Bitcoin trading is on the rise and while investors cannot really predict the price swings, there are some tips and tricks that ensure good returns for them. Over the years, traders have successfully identified methods, rules, and patterns that have brought them profits. The right method for trading: Whenever you step into the Bitcoin world either to buy coins or other things, it is crucial to be familiar with the right method to trade. When planning to invest in Bitcoin, you can buy it by the cryptocurrency exchange. You get the ownership of the whole coins in your hands and store them in your digital wallet. Dec 09, · Bitcoin trading – Important tips that you need to know! Wednesday, December 9, AM UTC With the advancement in Internet technology, everything is .
Bitcoin trading adviceBitcoin trading – Important tips that you need to know! - EconoTimes
Another factor is news, which depicts a perception of Bitcoin. The right method for trading: Whenever you step into the Bitcoin world either to buy coins or other things, it is crucial to be familiar with the right method to trade. When planning to invest in Bitcoin, you can buy it by the cryptocurrency exchange.
You get the ownership of the whole coins in your hands and store them in your digital wallet. You keep the coins stored, thinking that the price might rise someday, and you can make a profit by selling it. One must know that it is not a simple process when you want to open an account for exchange purposes.
Frame a plan for trading: Before you begin with your tactics or strategies, it is wise to frame a trading plan. For this purpose, you can define your goals in the plan. Goals must include the aims you can achieve can turn out to be a motivation. Another key thing to consider is style since trading can be performed in multiple ways.
It just depends upon your trading option, so you need to include it in your plan too. Rely on saying no to losses: This is something that can help you stay ahead in the competitive world. Cryptocurrency is not about involving in anything without having prior knowledge about it.
You can never achieve a higher profit until you stay saying no to your losses. This tip can sound diplomatic, but it turns out to be an effective tip to safeguard your investment decisions. Once you become a pro in this tip, it can help you dig more profits ahead in your journey. Read More: 9 Additional Tips For Trading Bitcoin In the above-content, you might have gone through all the Bitcoin trading tips which can help you become a successful bitcoin trader.
View more search results. Discover the best bitcoin trading strategies and some top tips for getting started. The best bitcoin BTC trading strategy is one that is perfectly aligned to your own individual goals, risk appetite and available capital. However, there are a few strategies that have become popular with bitcoin traders. These include:. It has since evolved to become a strategy that revolves around maintaining a long position on bitcoin, in the hope that it increases in price over the long term and return to the peaks of the However, bitcoin is notoriously volatile, which means that this strategy could result in losses.
This is why the strategy is rarely recommended without a strict risk management plan in place. Individuals who already own BTC might consider hedging their bitcoin risk if they believed that there was going to be a short-term decline in the market price.
Hedging is the practice of opening strategic trades to decrease or eradicate the risk to existing positions. This would mean that any loss to your original bitcoin holding would be offset by the profit to your short bitcoin trade.
There are a few financial instruments traders can use to hedge their bitcoin exposure, but a vast majority of traders choose to hedge with contracts for difference CFDs. As a derivative product there is no obligation to own the underlying asset in order to trade. Want to practise hedging bitcoin? Start building your strategy in a risk-free environment using an IG demo account. It is important to remember that there are significant risks if you decide to hedge your bitcoin using a short-selling strategy.
This is mainly because there is an unlimited downside risk — when you sell a bitcoin, there is no constraint on the amount the market can move against you and how much loss you might incur as a result. So, it is crucial to have risk management measures in place. A trending market is one that reaches consistently higher highs or lower lows. The strategy is suitable for different timeframes, as essentially you hold your position open for as long as you believe the trend will continue — whether this is hours, days, weeks or months.
For many, bitcoin itself is a trend. As such a popular market, it is vital that trend traders stay abreast of any news and events that might influence its price. Discover what cryptocurrency trading is and how it works.
Trend following strategies use technical analysis to predict the direction of market momentum. There are multiple ways that traders can identify the direction of a market trend and its momentum, which usually involve using technical analysis indicators. Popular trend and momentum following indicators include moving averages, the relative strength index RSI and the stochastic oscillator.
The strategy is based on the idea that once a market breaks through a key support or resistance level, major volatility will start. Bitcoin traders would therefore look to enter the market at these key points in order to ride the trend from start to finish.
In order to identify support and resistance levels, bitcoin traders will often use volume levels as confirmation signals and technical indicators, such as the RSI or the moving average convergence divergence MACD.
Once these levels have been identified, you can open a position. If the price did rise to this level, your CFD would be executed and you could ride the bitcoin trend until your analysis showed it was going to reverse.
The bitcoin market is infamously volatile, which makes it absolutely vital to understand the market before you implement your strategy. There are a lot of factors that can impact the price of bitcoin, including:. However you decide to trade bitcoin — whether this is buying the coin outright or speculating on its price with derivatives — it is important to understand your chosen method.
If you decide to buy bitcoin, you would do so via a cryptocurrency exchange. You would take ownership of the coins themselves and keep them in a digital wallet, in the hope that they increase in value and you can sell them for a profit. When you open a position to trade a cryptocurrency, you are speculating on its price, which means that you can take advantage of markets that are rising and falling in value.
Learn more about how to trade cryptocurrencies. Before you start to build a strategy, you should create a trading plan. Volatility is a key part of the bitcoin market, but with volatility comes risk. This is why it is important to learn how to manage your risk before you start to trade. A risk management strategy should include stops and limits to set out the parameters of your trades.
Limit-close orders will close your positions once the market has moved by a certain amount in your favour, enabling you to lock in profits. While stop-loss orders will automatically close your position once the market has moved against you, enabling you to define your acceptable loss. And, if you are using derivative products, you can attach a guaranteed stop to your bitcoin position that will protect your trade if the market moves against you.
If your guaranteed stop is triggered, there will be a premium to pay. Alternatively, you can join IG Academy to learn more about financial markets. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument.
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