12+ Day Trading Cryptocurrency Tips by Safetrading [2020 Guide]
Do you want to day trade like a pro? Safetrading prepared a couple of valuable tips and advice for you to earn profit from intraday trading cryptocurrency.
The Best Day Trading Cryptocurrency Tips [Safetrading Guide]
Day trading came to the crypto world from other markets and is nothing new.
For this type of trading, you need to choose volatile assets that can dramatically change their value during the day. So, in fact, there is no best crypto for intraday trading – all of them are quite volatile.
In today’s article, you will learn:
- 3+ Day Trading Skills
- The Common Day of a Day Trader
- Day Trading Cryptocurrency Strategies
- Disadvantages of Intraday Trading Cryptocurrency
- Basic Rules for Crypto Day Trading
Day Trading Skills
A trader who decided to check this type of trading should be very observant and to monitor quotes online.
Fast thinking is also a must for a crypto trader. It is necessary to accurately determine the local market entry current. If the trader cannot determine such a point, then there is no point in trading within one day.
Of course, let’s not forget about the skills common to all traders, such as knowledge of theory, the ability to set stop orders, and exit points from a position.
You will have to work at a very fast pace. Sometimes traders can give up very fast, so stress resistance for intraday trading will be a must.
The Common Day of a Crypto Trader
With intraday trading, there is practically no way to predict the behavior of the cryptocurrency price.
Everything that can be done at the beginning of the day is analyzing the released news from the world of cryptocurrencies and analyzing the main trends.
Yes, let’s say right away.
With day trading cryptocurrency, the entire forecast will be based mainly on news, which will affect the value of cryptocurrencies.
Day Trading Cryptocurrency Strategies
As we said, there are two main strategies for day trading – scalping and news trading.
Scalping involves setting a specific threshold for closing a position. The most important thing in scalping is choosing the right moment to enter.
Experienced traders, when choosing an entry point, prefer confident trend movement. The position is closed if the desired profit level is reached or by setting a stop loss and moving it if the trend continues to shift.
Trading on the news is especially relevant for the cryptocurrency market. Unlike scalping, when trading on the news, trend detection can be done more successfully.
A crypto trader needs to follow all the news in the world of cryptocurrencies. We pay special attention, of course, to the news that can cause a positive trend. This will be the entry point.
Trade-relevant news can be found in the calendars of events in the cryptocurrency world. Such calendars are written in advance, so it is possible to determine the “promising” day when trading can bring higher income.
Disadvantages of Intraday Trading Cryptocurrency
If you traded earlier based on free Forex signals, for example, you would definitely be sure that each trading strategy has its own risks and disadvantages.
Day trading is not an exception.
- You can make big profits with a big number of trades, which takes an incredible amount of effort in the case of day trading.
- There is practically no time to analyze the situation. You need to be constantly concentrated and attentive, otherwise, day trading will only bring losses.
- It is possible to make money on day trading only by conducting a large number of transactions. More trades – more commissions need to be paid to the exchange.
Basic Rules for Crypto Day Trading
- The loss limit should be set not only for one day but also for a longer period, for example, for a week.
- Trading should take as long as the trader can maintain high alertness and productivity. If it’s 2 hours, it’s okay. This will be enough to make money.
- Day trading requires trading at approximately the same time of day every day. If you have the opportunity and desire to trade several times a day, then you should limit yourself in advance in the number of trades.
- If we see the unclear situation in the cryptocurrency market, we will close deals.
- Use only the best Bitcoin wallet to store the assets.
Conclusion: Day Trading Cryptocurrency
Cryptocurrency trading has different strategies, and day trading is one of the most popular.
Now you have a chance to find some new tips or strategies for you, or to correct mistakes using the advice of professional traders we highlighted.