How to Start Day Trading Crypto

Since you’re a beginner, always keep in mind that the crypto market is very volatile. Now, you might not be able to initiate the process, but if you can spot it in motion, you can ride the whales all the way to a decent profit. Because stop losses are typically placed around psychological levels, we often see these violent fluctuations around these kinds of resistances.

What is Crypto Day Trading

For starters, if you prefer manual trading, you can use a wide range of available smart orders and risk management tools such as Stop Loss & Take Profit. It’s not day trading platform unusual to see a particular crypto asset spiking through the roof on the same day. Along with these tools, be sure to keep an eye on the latest trends and news.

As is the case with many other assets, some people buy and hold crypto for long-term gains. Others purchase crypto to use in transactions, as an alternative to government-backed currencies. To further support newcomers to the crypto trading world, BingX provides an exhaustive Beginner’s Guide. Furthermore, the Help Center serves as a prompt and efficient first line of support for queries, covering a wide spectrum of topics from changing passwords to account verification.

This could have been achieved without you needing to sit at your computer all day to check for any price movements. You can also apply the same trading techniques too, such as setting stop-losses or market limit-orders. Range trading is a relatively straightforward strategy that can be suitable for beginners. It requires a good understanding of candlestick charts, support and resistance levels, and may involve momentum indicators such as the RSI or MACD.

Identifying setups is relatively simple when using the 3 EMAs – which also help with stop-loss positioning and precision executions. Position your stop slightly below the trend line, remembering to account for wicks. You want to look for a long or short opportunity in the direction of the established trend. The candles will eventually retrace to the 50 – 100 EMA, indicating that the market is trading around fair value. You are trading with the trend, so make sure it is established and strong.

The platform also supports ZAR accounts, which is a bonus for locals as it avoids unnecessary currency conversion fees. Years active — Established platforms like Coinbase or Binance are usually credible and more trustworthy. It’s important to assess a platform’s credibility, especially when trading high-value volumes. Regardless of the form of investment, money invested in cryptocurrencies has risen dramatically from about early 2017 into the next half-decade.

You can then move up from there as you grow in skills, and find more success down the line. A trader looks to purchase a digital asset that they believe could increase in price over the next few hours. Then, they look at assets which they believe will decrease in value and short those. You should carefully consider whether you fully understand how cryptocurrency trading works and whether you can afford to take the high risk of losing all your invested money. It is typically considered the highest-risk approach to crypto trading, and novice traders should learn the basics of crypto trading before attempting to day trade or scalp. As shown on the chart below, stop losses for breakout trade setups are best placed inside the trading range or before the support or resistance level.

This is determined by how long you like to hold an asset before you sell it. In my “Day Trading Cryptocurrency” guide, I am going to tell you everything you need to know. This will start by explaining exactly what day trading is, followed by the things you need to consider.

  • The MFI can be used in addition with the RSI to check whether the price of BTC is trending towards a bullish or bearish divergence.
  • US-based traders can use only domestically regulated crypto-trading platforms, so this is a major factor to consider when researching the right platform.
  • Because there are no earnings reports in the crypto market, news traders need to keep their ears close to the ground for any developments relating to the coins they follow.
  • Proper risk management strategies, including using a reputable crypto exchange, are essential and can help increase your chances of success.
  • If you hold a crypto investment for at least one year before selling crypto, your capital gains qualify for the preferential long-term capital gains rate.

Crypto day trading can be a lucrative, but also a high-risk strategy involving constant purchase and sale of cryptocurrencies in pursuit of short-term profit. If you’re interested in day trading, you must understand the crypto market, have detailed trading strategies, know where you plan on trading, and stick to your entry and exit points. However, you can combine HFT with different crypto day trading strategies for beginners by instituting specific trading logic. Because day trading involves multiple transactions a day, perhaps the most critical thing to learn first is proper risk management techniques. It is impossible to predict the markets with 100% accuracy, and even the best of traders will experience losses.

If you’d like to read about a simple formula for position sizing, check out How to Calculate Position Size in Trading. Bitsgap’s automated bots help crypto traders effortlessly make profits 24/7. One of the best things about cryptocurrency is that you can begin trading with nearly any amount of money. Crypto coins and tokens are not required to be held in full amounts, which means you can trade with even a very small investment.

What is Crypto Day Trading

When comparing offers or services, verify relevant information with the institution or provider’s site. Trades will come around less often, but a slightly higher timeframe is a good starting point for feeling out the pullback trade and will allow you more time to plan your entries. The 150 EMA will typically be around the swing highs/lows, meaning that if this zone is broken down, the trend may end, and the trade setup is likely to be void. The trade setup below shows where a stop loss would have been triggered following the breakdown of all 3 moving averages.

The term “intraday trading” is often used interchangeably with day trading, as it describes the process of initiating and concluding trades within a single day. Day trading, on the other hand, is not a get-rich-quick scheme but a clever strategy to generate income and create wealth over time. It requires adequate planning, proper execution, risk management, and trading skills. Good risk management skills protect cryptocurrency traders from losing all their capital or making significant losses. Most day traders work from home for starters and don’t have tough bosses telling them what to do at all times. Better still, successful traders can make enough money to lead a comfortable life.

What is Crypto Day Trading

As I mentioned earlier, day traders look to make quick, short-term gains, which can be lower than 1% per trade. These traders will have a very large “bankroll”, meaning that they can still make good money even if the percentage gains are small. In the above section, I briefly discussed what day trading cryptocurrency actually is and some of the crypto trading strategies people use.

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