how to day trade crypto

Day trading Cryptocurrency involves the buying and selling of digital coins with the intention of quickly turning a profit. Popular amongst the more experienced, day trading Crypto calls for a level of skill and knowledge to enable a trader to identify certain patterns and market trends in order to drive profits. With its 24/7 market environment, Crypto also offers day traders an opportunity to gain exposure to potentially lucrative positions at any moment.

Fundamentally, day trading Cryptocurrency can be broken down into three key stages; setting up an account, performing technical analysis, and executing trades.

Setting up an Account

To day trade Cryptocurrency you will need to set up an online account with a reliable broker. These accounts will provide you with access to a host of online exchange and portfolio tools that can be used to monitor the markets and make trades. You should look to use a reputable exchange such as Coinbase and Binance, as well as other cryptocurrency-specific tools such as ShapeShift, to help manage your portfolio.

The next step is to set up a wallet to store your cryptocurrencies. These wallets are available both online, such as bitcoin-and-h4s-myetherwallet.org, and in physical form, such as a USB-Thumb drive. It is worth noting that an online wallet is vulnerable to attack, so if you are planning to store large amounts of money you should invest in a secure offline wallet.

Another important factor is the fees associated with the exchanges and wallet providers you choose. Take the time to compare fees, deposit policies, and withdrawal times between exchanges to ensure that you buy and sell coins at the best rates available.

Performing Technical Analysis

Once you have set up your account and your wallet, the next step in day trading Cryptocurrency is to develop a strategy. This should involve a combination of fundamental and technical analysis that you can use to guide your trading decisions.

Fundamental analysis will involve assessing market sentiment and the underlying fundamentals of a currency or market. To gain an edge, research leading platforms such as Twitter, Reddit, and BitcoinTalk, as well as smaller platforms such as Telegram, Slack and the like. Pay particular attention to news coverage, as well as forecasts from leading minds within the Cryptocurrency world.

Technical analysis, however, is the primary form of analysis that a day trader should use. Technical analysis involves the use of charting data or analysis to identify patterns and trends within the market. To do this, you will need to make use of a range of indicators and charting tools.

The most popular indicators include moving averages (MA’s), relative strength index (RSI) and Fibonacci Retracements. There is also the option of using advanced charting software such as Trading View or Coinigy, which both offer real-time charting and data about individual currency pairs.

It’s also important to look for bias within the market, as it can indicate scarcity or an oversupply of the coin you plan to day trade. For example, if the market is bullish then it may indicate a bullish sentiment, which could present an opportunity to buy.

Executing Trades

Finally, when day trading Cryptocurrency you will need to be able to quickly execute trades. To do this, you should look to enlist the services of a broker or exchange that offers advanced trading software and integrated trading tools.

Some exchanges, such as Coinbase and Binance, offer their own ‘trading view’, which provides advanced technical analysis services, as well as real-time data and charting. These brokerages are a great place to start as they make it easier to trade cryptos in a more accurate manner.

That said, to achieve the best possible trading results, you should look to use an advanced trading platform such as Coinigy. Coinigy’s software provides access to a range of exchanges and portfolio tracking tools alongside a host of charting and analysis options.

Conclusion

Day trading Cryptocurrency can be a lucrative and profitable endeavour, but it is important to do your research and develop a trading plan that suits your interests and skill level. Ensure that you have set up your account and wallet, as well as having conducted both technical and fundamental analysis, before placing trades. Finally, selecting a suitable broker or platform can help improve the accuracy of your trades and enable you to realise more profits. Following the above steps and finding a reliable, high-quality provider should allow you to make the most of your trading activities.