Bitcoin trading – make enough money shortly!
Bitcoin trading is the way a trader predicts the movement of bitcoin. The most basic approach in trading bitcoin is to buy low and sell high, just like trading any other investment vehicle. Still, few know that bitcoin trading has a revenue potential more than stock market and commodity trading. Then, if you are planning to start bitcoin trading, trust only reliable software.
The revenue in bitcoin trading can be through scalping, day trading, position trading, and arbitrage. Bitcoin traders are to be accepted by most finance giants like Goldman Sachs, JP Morgan, and Morgan Stanley because of their wild and erratic nature. The media is producing news about it every other day, saying that new avenues are opening up for bitcoin trading.
How to trade bitcoin?
Buy low and sell high.
To understand how to trade bitcoin, it is essential to understand trading basics. Trading basics include three ways of making money in the markets – price movement, volatility, and volume. One can make money in bitcoin trading through all these three elements.
Price movement
One can make good profits by buying bitcoins when the value is low, and the price is expected to go up further, and by selling them when the value is high. It will result in a bitcoin trading strategy being a price movement trader who makes money by predicting the price movements of bitcoin against other virtual currencies, fiat currencies, and gold or silver. Many traders consider this approach a conservative method for trading on movements rather than volatility or volume.
Bitcoin volatility
Volatility refers to the significant differences in bitcoin prices. Several traders make profits by predicting the volatility of bitcoin pricing. Bitcoin price will record significant swings in the way commodity prices do; hence, it is considered a good source for day traders. One can also make money by predicting price changes when there is an increase or decrease in the trading volume, referred to as trading on volume.
Bitcoin Trading Strategies
Scalping- Scalping is a type of intra-day trading wherein a trader buys and sells Bitcoin within the same day several times with small profit margins each time. Scalping is generally done by people looking for small profits and does not want to incur high risk.
Scalpers monitor market data, such as price movements and volatility movement (up or down), bitcoin trading volume, and order book activity to predict how the bitcoin exchange rate will change soon. Scalpers use complex trading algorithms, mathematical formulas, and hundreds of charts to profit from small price movements on bitcoin.
Scalping is most profitable when market prices are volatile. Scalpers can generate profits at relatively low risk because they use high quantities of leverage and very short-term holds on their positions.
Day Trading- One can make money by predicting price movements via day trading only when volatility is high.
Day traders trade on bitcoin exchanges and other markets where the price of bitcoin changes rapidly. Day traders also trade bitcoin futures contracts on these exchanges. When analyzing charts for predictions about price movements, day traders focus more on volume than volatility.
When a large volume is recorded in a period, a trader believes that the price will rise dramatically within hours because many expect further value increases. However, like scalping, day trading is more volatile since bitcoin prices are significantly affected by random factors.
Position Trading- Position traders have long positions in bitcoin and take advantage of price fluctuations. For example, a position trader may have a short position in futures but a long position in bitcoins. This trader takes to profit from both the significant movements of bitcoin and prices back in the exchanges and futures markets.
Position traders use programs that analyze chart patterns and signal price changes based on these patterns. The signals themselves may be complex, but their purpose is to indicate that a trader should buy or sell bitcoins when prices reach certain levels or remain above or below them for a specific time. Position traders are most profitable when volatility is high. Most of these traders buy and sell bitcoins at volatile times, buying bitcoins when they see a dramatic rise in bitcoin prices.
Arbitrage- In the case of bitcoin, trading arbitrage involves trading between bitcoin prices on different exchanges instead of trading among fiat currencies like dollars, pounds, or euros.
