As Robert Arnott, an American Entrepreneur, founder, and chairman of the board of Research Affiliates said, “In investing, what is comfortable is rarely profitable.” Right now, the world of cryptocurrencies seems to be the riskiest, and also the most profitable investing choice amongst all.
And cryptocurrency trading seems to be booming at a rapid pace in the last few months. The trading volume and the highly volatile nature of cryptocurrencies suit short-term trading as well. But for beginner traders and even professional traders who are just starting out in the realm of cryptocurrency trading may often find themselves lost in this seemingly maze-like complexity of cryptocurrency trading and exchange. Therefore, we have made a list of the most important things you need to know in order for you to get started on crypto day trading.
Trading in Cryptocurrency
- You need to decide if you want to own a digital currency or just have a belief that its price value will rally. At this point, you need to use an exchange — try Giottus — It’s a fast, secure, and user-friendly app.
- The next step — put funds in your account.
- Lastly, buy the digital currency that you want or trade on its price.
Great! Now you’re a cryptocurrency trader. Remember, you also have the choice of practicing your transaction of cryptocurrencies on a demo broker account, although you cannot practice on an exchange.
Rather than owning any of the digital currencies, speculating on their prices is a general level of involvement in digital currency trading.
Crypto Trading Strategies
There are several strategies that might help you get the crucial edge that you need in making your foot through the crypto day trading door. You’ll need to exercise highly useful and effective strategies to make considerable gains while trading with cryptocurrencies.
Below you’ll find a good example of a greatly used and highly effective crypto-trading strategy.
RSI Divergence Strategy
RSI (Relative Strength Index) divergence strategy is a more technical and analytical approach to trading in cryptocurrency but a highly effective one given the reversal of timing trends. A reversal in timing trend is when the price starts moving in the opposite direction, that is, from a downward to upward trend or vice versa.
RSI is a chart indicator that includes the measurement of momentum by calculating the average number of gains and losses over a 2-week period.
The best time frame to observe divergences happening is generally within a 4-hour or daily window. These time frames usually show strong shifts in the mid to long-term trend.
Additionally, the best time to look for divergences is when the prices are moving in the wither the overbought or oversold areas.
Wallets
Actually, owning a digital currency requires you to own a digital crypto wallet. Some great exchanges provide you the means to store the digital funds you make when day trading in cryptocurrency. Giottus is a great place to store and manage your digital currencies in one place and forget about the worries that come with handling different platforms for different transactions and storage. It provides you the ultimate place to do all your crypto trading and transactions.
Additional Things to Keep in Mind
Rules and Taxes
The cryptocurrency market is relatively new, and countries and institutions are scrambling to regulate this newfound market effectively. If you are unfamiliar with such regulations, then you may find yourself in a difficult situation to deal with.
Several governments are unsure about the safety and reliability of cryptocurrencies as compared to fiat currencies. On top of that, new regulations can also affect your tax obligations. Every country’s cryptocurrency tax rules are different, and many change their regulations in order to adapt to the market trend. Therefore always do your homework before doing day trading in order to avoid horrible and unexpected taxes.
Bots
Existing strategies that might work for you can be automatically implemented by using trading bots. A cryptocurrency trading bot is a programmable automated algorithm that self executes trades when pre-defined criteria are met. They have many benefits but the most important ones are speed and multiple trading options.
- It saves you a serious amount of time and relieves you of the tedious task of looking at the charts all day and manually inputting data when needed.
- Additionally, it allows you to trade across multiple digital currencies and assets at the same time, which increases your chances of potential profit and removes you from doing the heavy lifting.
Final Thoughts
Cryptocurrency day trading is not easily defined as easy or hard. It is a long and arduous process and requires patience and skills to master like any other field. Therefore, if you do the necessary research and take the needed precautions, then you’ll definitely be rewarded for your efforts in the crypto trading market. Just remember to follow all the above-mentioned tips and strategies, and you’ll rest assured see that day trading would become a great decision in your financial life.
A great start to your crypto day trading experience would be joining a highly trusted and reliable exchange platform. Giottus is India’s Most rated Cryptocurrency exchange platform and gives an easy-to-use, secure, powerful, and fast medium built for beginners and advanced traders that’ll help you every step of the way and give you 100% satisfaction in your trading experience.
Register now and get a chance to obtain free tokens.
