Wondering how to trade Cryptocurrency for profit? Whilst it’s not super easy, it’s possible to be profitable if you understand how to do it. In this article, you’ll learn all the steps in order for you to become a crypto trader.
October 1, 2020 | AtoZ Markets – Our first attempt at understanding the ins and out of Cryptocurrency can be dizzying, to say the least. Think back to when you heard someone mention Bitcoin for the first time, and it’s likely that a lot of questions began popping up in your head: How does Bitcoin work? Where does Bitcoin’s value come from? And, most importantly, is it safe to buy Bitcoin? As with everything in life, patience is key to learning and the best way to learn about Cryptocurrency is by taking one step at a time.
How to Trade Cryptocurrency for Profit
In reality, trading Cryptocurrencies for profit is not as complicated as you may think. In this article, we’re taking a look at the best ways to trade cryptocurrencies so that you can learn how to day trade Bitcoin, Ethereum, and other coins in no time.
Before we begin, let’s try to understand some of the key reasons why trading Cryptocurrencies has boomed over recent years. Since Bitcoin is the first and most popular type of Cryptocurrency out there, we’ll look at a few features that make it a desirable asset to trade!
The best way to practice trading Cryptos is through a Demo Account, as this gives you the opportunity to see market movements in action and start trading without any cost. Sign up today at LonghornFX
Let’s dive right in with some basics:
- Bitcoin is a decentralized cryptocurrency, meaning that there’s no single person or entity that controls Bitcoin. Crypto markets are open 24/7 since trading takes place across hundreds of global exchanges.
- Bitcoin is based on Blockchain technology, which provides easy traceability and transparency in transactions taking place over the network. The value of cryptocurrency is derived from the underlying technology and users’ trust in it!
- Bitcoin and other Cryptocurrencies are highly volatile when compared to traditional markets, creating more opportunities to profit when compared to traditional stock trading.
What is the Best Way to Trade Cryptocurrency?
Although Bitcoin is considered to be a high reward for long-term investment, others might want to generate short-term profits by trading Bitcoin instead. The volatile nature of Bitcoin and other Cryptos means that it’s possible to make money by day trading.
So, how can you start day trading popular cryptocurrencies?
Contrary to popular belief, you don’t actually need to buy Bitcoin from a Crypto exchange to be able to profit from the market movements. Online Brokers offering CFD trading give you the option to open trades without owning the underlying asset. Instead, your profits or losses will be equal to the difference in price between the opening and closing times of the trading contract.
This doesn’t mean, however, that a dip in the asset’s value will result in a loss. With CFDs, traders can choose between ‘long’ and ‘short’ positions, so you can profit from the market highs as well as the lows!
Essentially, CFDs are a simpler, faster, and cheaper way to trade, when compared with buying and selling the underlying asset directly. Anyone can trade CFDs easily from the comfort of their own home, so it’s the obvious choice for people looking to make a profit from trading Cryptos.
Trade Cryptos with Leverage
Since cryptocurrencies are characterized by a high level of volatility, having a short-term trading strategy could lead to huge profits in a short span of time. Online Brokers can also give traders the chance to trade with leverage, meaning that they can open a position worth more than the funds they are investing. For example, if you want to open a position valued at $10,000 using 1:200 leverage, you’ll only need to deposit $50 into your trading account.
How to Choose a Crypto Broker
If you’re looking to start trading Cryptocurrencies for profit, you’re going to need a reliable broker offering top-quality trading conditions. Low commissions and narrow spreads are both important factors to take into consideration when choosing a broker, but that’s not all you should be looking out for. Here are some features that differentiate the best brokers from the average ones:
- Variety: how many Cryptocurrency pairs does your broker offer? With thousands of cryptos in existence, it’s easy to get lost in a whirlpool of assets. Not all cryptocurrencies are profitable, so it’s best to find a broker who can offer the most popular and profitable coins all in one.
- 24/7 Trading: One of the major pulls of Crypto trading is that the markets truly never sleep. So why would you want to limit your trading to office hours only? Find a broker who offers round-the-clock Crypto trading so that you’ll never miss out on those important market movements.
- 24/7 Support: Customer support is an indication of a broker’s loyalty toward their clients. Having a support agent ready to help you out with any problems you face, even on the weekends, is important for your comfort and peace of mind.
- Crypto Deposits: Since Crypto markets move so quickly, having a fast deposit method such as through Bitcoin is ideal. This means you can load your account in a few minutes and start trading instantly.
- Quick Withdrawals: Finally, you’re going to want to withdraw your profits once you’re done trading – and you don’t want to use a broker that would stop you from doing just that! Same-day withdrawals are a feature hard to come by, but this is a true sign of a reliable broker.
Ready to start trading Cryptocurrencies for profit? With LonghornFX, you can get all of the above features and access to over 35+ Crypto pairs including BTC/USD and ETH/USD, with 1:100 leverage!
LonghornFX also offers a wide variety of over 160 assets, including Forex and Stocks, all through the MetaTrader 4 platform. Create a free LonghornFX Account to start trading today.