Crypto Trading Strategies You Should Be Aware Of

According to a recent news article, more than ten crore Indians possess cryptocurrency. The figure is likely to rise considerably higher throughout the festive period.

Crypto trading, like trading in stocks and commodities, is riddled with dangers and drawbacks. To reap long-term rewards from crypto trading, market participants must devise tactics that make trading both enjoyable and risk-free. Let us begin by discussing tactics that might assist you in obtaining favorable results.

Trading during the day
This trading method entails entering and quitting positions on the same day. A trader’s goal in engaging in such a transaction is to profit from intraday price swings in a cryptocurrency of his choice. For a successful transaction, investors sometimes rely on technical indications to determine entry and exit locations for certain coins.

Trading in the ranges
Market participants also rely on skilled analysts, who provide daily support and resistance levels. ‘Resistance’ refers to the price level over which the price may climb, therefore a resistance level is a price higher than the present price. In contrast, ‘Support’ is a level below which a cryptocurrency price is not expected to fall; hence, a support level is always lower than the present price.

Scalping
This trading method entails increasing trade volumes in order to earn. Despite the danger, a wise trader considers the margin requirement and other crucial guidelines to avoid negative trading experiences. Scalpers examine the crypto asset, previous patterns, and volumes before deciding on an entrance and exit point within a day.

HFT stands for High-Frequency Trading.
HFT is a quant trading method that employs an algorithmic trading approach. This entails creating algorithms and trading bots to aid in the speedy entry and exit of a crypto asset. Creating such bots necessitates an awareness of sophisticated market ideas as well as a solid understanding of mathematics and computer science. As a result, it is better suited to experienced traders rather than newbies.

Averaging Costs in Dollars
When it comes to identifying the optimal entry and exit moment in a cryptocurrency market, it is advisable to believe that market timing is nearly impossible. So, ‘Dollar Cost Averaging’ (DCA) is a rather reasonable method of investing in cryptos. DCA is the practice of investing a certain amount at regular intervals. This method assists investors in avoiding the time-consuming task of market timing and accumulating riches over time.
However, in the DCA approach, exit strategy may be difficult. It necessitates a study of industry trends as well as a grasp of the market cycle. Reading technical charts can also assist you in determining when to depart. Before investing in cryptocurrency, investors should look for oversold and overbought areas.

Create a well-balanced portfolio.
Crypto trading is still in its early stages. While certain nations encourage cryptocurrency trade, others remain suspicious. Because central banks throughout the world are working on new ways to govern digital currencies, trading in cryptos may be dangerous. However, there are tactics that might assist investors in avoiding severe volatility.
Building a diverse portfolio of cryptocurrencies such as Bitcoin, Dogecoin, and Ethereum might go a long way toward mitigating volatility.

Avoid making trading decisions based on rumors.
Among the pitfalls that novice investors make is relying on social media for cryptocurrency news. Social media buzz should never be used to make investment decisions. Because digital money is a trendy issue, misleading information about it spreads rapidly.

Primary Investigation
Primary research is one of the most significant trading tactics. You don’t have to be a trading expert to undertake primary research on the worth of the item you want to buy. This entails keeping up with all of the latest developments in the crypto business. WazirX assists you in doing so swiftly by compiling all of the news articles that you need to read at the start of your day.

Arbitrage
Arbitrage is a trading method in which a trader buys cryptocurrency in one market and sells it in another. ‘Spread’ refers to the difference between the purchase and sell prices. Because of the disparity in liquidity and trading volume, traders may be able to benefit. To take advantage of this opportunity, you must register accounts on exchanges where the values for the cryptocurrency you are trading at fluctuate significantly.

Bitcoin Volatility Betting
It’s no secret that cryptocurrency is one of the most volatile asset types on the market right now. Bitcoin prices have changed by roughly 30% in a single session. Trading Bitcoin futures allows you to trade on volatility. The best way to go about it is to buy a call.