Let’s get one thing straight: trading in any market will always be a challenge. It mainly comes down to how wise you are, adopting the right strategy that suits you and makes your move at the right time.
Cryptocurrency is no different, so it pays to know a thing or two about the kind of trades available in the market and decide if you want to hold your cryptos ’til kingdom come or sell like the kingdom’s crumbling.
For newbies, this may seem like Wall Street speak but fret not. These five crypto trading methods could help you get the ball rolling.
This is ideal if you’re into short-term gains and thrive on the volatile nature of cryptocurrencies. You will need serious amounts of patience and an eagle eye for changing trends. You are likely to carry out multiple trades in a day, trying to make quick profits from short-term price movements. Oh, and you’re going to be glued to your computer all day.
Another cool short-term gain method, scalping refers to making reasonably good profit from small price movements. Frequently making smaller profits tend to limit your risk factors. Some scalpers are known to make tons of trades per day. They must be doing something right as many are currently scalping away.
If your plan is to take full advantage of natural price cycle swings, swing trading is for you. When you spot a particular price movement, you swoop into the trade and hold it until the movement wanes and cash in. Some hold for weeks and others, for months. Best of all, you don’t have to stare at your computer all day like day traders do.
Itching to make a quick buck but have limited cryptos at your disposal? Margin trading or leveraged trading could work up your appetite. Fundamentally, you can borrow additional cryptocurrency from your exchange on top of what you currently have and trade for an increased amount.
Here’s when you agree to buy or sell cryptocurrency for a definitive price at a predetermined date in the future. interestingly, you don’t have to actually own a cryptocurrency to enter the crypto market. Unfortunately, the time machine is not yet a reality to guarantee success here. Nevertheless, this will be a great test of your speculation skills and spotting trends.