There are several ways how to day trade Cryptocurrency. First and foremost, it s crucial to take advantage of a flexible trading schedule and a set rules-based methodology. As with conventional swing trading or scalping trading, you won’t trade every second day, but you’re not going to earn cash every second day either. So, you want a flexible day trading methodology to protect against your emotional swings and to keep your profit margins in tact. Here is a 5 step guide to how to day trade with Cryptocurrency.
- Step One: A good number of new traders have gotten burned in the field because they did not know how to day trade Cryptocurrency. Some of the things that newcomers should know and keep in mind are that there is always good news in the world, and that Cryptocurrency can be used for good. This is one of the reasons why the news about a potential brilliant trade can drive the prices up.
- Step Two: Do some research! The most important part of how to day trade cryptocurrences is finding out what is happening in the market. You can start looking at charts and indicators to see how the previous trading sessions worked out. Then, keep in mind that you are trading with real money and that you could lose all your investment, so use your brain rather than your heart. Also, most good traders will use some sort of indicator-based trading platform to let their brokers know which trades they should be involved in.
- Step Three: Learn how to get started. The third step to learning how to day trade Cryptocurrency is to figure out how you want to invest your money. There are many different ways to go about it, including buying and holding, trading on an exchange based in your country, or investing in an externally managed fund. Once you have determined how you want to proceed with your investments, read up on the various methods so that you can decide which ones are best for you. Usually, people who do day trading with Cryptocurrencies will use the latter option-it is significantly safer and more lucrative.
- Step Four: Try some exercises. One way to minimize your losses is to minimize the amount of money you lose. So, you should do some risk management exercises so that you do not put yourself into a severe financial situation. There are plenty of excellent online examples of how to day trade Cryptocurrency if you want to review the choices.
- Step Five: Follow the plan. If you are interested in how to day trade Cryptocurrency and have an idea of where you want to go, set a plan in motion so that you can get there. Many investors who get involved with the market in a long time do not take the time to think about their exit strategy, so they tend to loose money pretty quickly.
- Step Six: Pick a good base. If you do not have experience with how to day trade currencies or do not have any knowledge about any particular coins, then you should start with a safe base such as eether or litecoin. Both of these are great ways to learn the ropes and get a feel for the market.
- Step Seven: Learn how to set stop losses. The most important part about trading with any type of Cryptocurrency is knowing how to properly set your stop losses. Most experienced traders will tell you that you should not trade using more than about 20% of your account balance on any single trade, but since many new traders do not understand the significance of proper stop losses, they keep putting all of their money on the table at all times.