Bitcoin trading can be extremely profitable if you’re just starting out. There is also a high chance that you could lose everything. That is why it is important that you familiarize yourself with the industry before you decide to invest. The market is fairly new and highly fragmented. You can’t trust anyone with your money since they might just be as naive. There are platforms like bitcoin-revolution.io which are making it easier for people even beginners to learn how to trade Bitcoin. If want to learn how to trade Bitcoin, you’re in the right place as we have some tips that will come in handy.
Bitcoin has been known for its volatility. It is this trait that has resulted in both admiration and disdain for the cryptocurrency market. New investors will always want to jump on the bandwagon every time there is a rise in the price of Bitcoin. There are several online companies that offer platforms for Bitcoin trading. It is important that you do your own research before deciding on the platform to do the trading.
Bitcoin is Global
Bitcoin isn’t just some fiat currency. What this means is the price are not influenced or determined by the economy or government of a particular country. In the short history of Bitcoin, the prices have been affected by numerous events. From the Greek capital woes to the devaluation of the Yuan, there is no saying what could determine the changes in prices of Bitcoin. There are situations where economic instability has led to the rise in prices of Bitcoin.
24/7 Trading
Unlike the stock markets, there are no official times for trading when it comes to Bitcoin. There are hundreds of exchanges across the world that offer 24/7 trading platforms. There are no restrictions on what time the market opens or closes. Even though this could create arbitrage opportunities, the market prices are in most case the same regardless of the region.
It is Volatile
Anyone who is thinking about getting into Bitcoin trading should be ready for the volatility. The coin is known for frequent price movements. It is less than two years ago when the price was almost hitting the $20k mark. It is not uncommon to have days where there a swing of 5% or more. The volatile nature of Bitcoin can be seen as an opportunity for investors with an appetite for risks.
Finding the Right Exchange
As we’ve mentioned before, there is no official exchange when it comes to trading Bitcoin. This can be seen as a good and a bad thing. When looking for an exchange, there are a couple of considerations that you should be having in mind and they include:
Trust: You need to be looking for an exchange that can be trusted. This can be a challenging endeavor given the online landscape where people start businesses with the sole purpose of swindling unsuspecting traders. You can check out Bitcoin forums for recommendations as you’re likely to get unbiased reviews on such platform.
Location: The location of the exchange is also an important consideration. You want to work with an exchange that supports your local currency. It is easy getting in touch with the support of the particular exchange if it is located in your country or serves your region.
Trading Strategy
While the goal is to achieve a common objective, there are different strategies that can be employed when trading Bitcoin. Some of the common trading types include:
Day Trading: This strategy will include carrying out multiple trades throughout the day. The goal of day trading is to make a profit from short-term price movements. As a day trader, you may be forced to spend hours in front of the computer just to close one or two trades.
Scalping: This is a particular day-trading strategy. The goal is to make substantial profits even with slightest movements in prices. The principle behind scalping is making small profits repeatedly which will eventually add up in the grand scheme of things.
Swing Trading: Swing trading takes advantage of price cycle swings. A swing trader needs to be keen enough to notice the start of a particular price movement. The person will then enter the trade at the early stages. As a swing trader, you’re supposed to have the big picture in mind. You don’t have to worry about constantly monitoring the computer.
To conclude, trading in Bitcoin will require that you do research beforehand. The exchange that you chose could have an impact on your success.
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