Crypto trading refers to the speculation of the cryptocurrency price movements via a CFD trading account or the buying and selling of the coins one has via an exchange platform. Crypto is a very volatile asset which leads many investors to trade. If you are able to time the market right, crypto trading can give you much more returns compared to other conventional investments.
To time the market accurately, CFD trading will be crucial. These are derivatives that help you in crypto trading by allowing you to speculate crypto price movements without necessarily owning any of the underlying coins. You can then buy if you think that the crypto asset will rise in price or sell if you speculate that it will fall. Using PrimeXBT, you can be able to speculate on the price movements of crypto assets and take advantage of the market to make maximum profits.
With crypto trading, you will need to put up a small deposit also known as a margin. This will allow you to gain full exposure to the underlying market. Whatever profit or loss you record will be calculated based on the full size of your position, so leverage will magnify both profits and losses.
Steps to Get Started Crypto Trading
The first step to getting started with crypto trading is to make a cryptocurrency brokerage account. There are many crypto brokerages in the market. If you are a beginner, it is wise to settle on one with a simple user interface that offers a variety of altcoins to choose from. You will also need to provide the brokerage with personal identification information.
You will then need to fund your account. You do this by connecting the account you have just created to your bank account. Most crypto brokerages allow you to fund your account through debit cards and wire transfers. However, wire transfers are generally the cheapest option.
Once your account is all set and funds available, you then have to decide which crypto coins to invest in. The pro traders and the most active traders allocate most of their capital to more stable coins like Bitcoin and Ethereum. This is because they are more predictable compared to smaller altcoins thereby making trading easier.
Crypto trading requires a strategy to make profits and avoid losses. There are many trading indicators to choose from and numerous factors to consider before buying or selling any crypto assets. If you are a beginner, taking a crypto trading course will come in handy. If you are a stock trader, you are at an advantage since most of the stock trading strategies also apply in crypto trading.
You may also want to consider an automated crypto trading platform. The trading bots will choose for you a strategy that will ensure you get the best results and maximum profits from your investment. This will help you diversify and grow your portfolio further.
Finally, you will need a safe wallet to store your cryptocurrency. This is especially important if you intend to buy crypto coins and hold them for the mid to long-term. The crypto wallets come as software or hardware wallets. Both offer a secure means of storing your funds. However, hardware wallets are the most secure.
In conclusion, while crypto trading allows investors to make great profits, it is also a great risk. By actively trading, you risk losing your crypto to the volatile market. It is not unfamiliar to hear traders who have lost most or all their money quickly through crypto trading. Therefore, it is important to sometimes just HODL your assets. This refers to holding and accumulating your assets. You may sell later when the markets are booming (the bear season).