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A Quick Guide to Crypto Trading Strategies

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Cryptocurrencies are in trend nowadays. Bitcoin, ethereum, litecoin and several other altcoins are gaining popularity and capturing a huge market share. Many people have invested in these due to store-of-value and high returns.

However, it is still the most challenging and confusing place to carry out financial deals. This is because there are a plethora of digital assets and ways to get the benefit from them in the giant crypto world. Hence, it is imperative to choose wisely your digital coin and strategy to maximise your returns and credibility.

Here is the list of crypto trading strategies to choose from and implement the same for desired results.

1. Day trading

It is the most well-known crypto trading strategy in India. Day trading involves entering and exiting the positions of the users on the same day. It happens when the price moving takes place within a trading day.

It is also one of the oldest traditions of work where all the dealings take place in the daytime only. Hence, in such a system day traders never resume their work or stay in position at night.

When integrated with the crypto market, it is referred to as a short-term trading style because of the 24/7 availability of digital services. So, here the traders left the positions within a time span of 24 hours of a day.

2. Swing trading

It is a strategy that involves long term commitment, unlike day trading. It requires working for more than 24 hours a day but typically not extended to a month. Swing trading is the most compatible and easy active trading strategy for beginners. It allows more time to make certain decisions. In addition, it is benefitted from the waves of the volatility of the market which generally take several days or weeks to play out. Therefore, it requires more than a day to complete the trading cycle.

Swing traders can combine their technical and fundamental factors to formulate their trade ideas and take accurate decisions.

3. Trend trading

It is the extended version of swing trading. It includes working for more than a month to reach the final goal. As the name suggests, trend traders try to get the advantage of the trends settling in which can last for a couple of months. There is a possibility that they end up in long positions in an uptrend and shorter in a downtrend.

It works on the assumption that the underlying asset will move in the direction of the trend. However, trend traders also have to watch out for the trend reversal. It can be a deal solution if practised with due diligence and the ability to manage risk.

4. Scalping

It is one of the quickest crypto trading strategies in the market. Scalpers never try big moves or take advantage of the downtrends. Instead, they believe in small and recurring moves to build efficiency in their trading style. This strategy enables to earn small profits constantly which add up to a big amount with time.

This technique is generally eligible for markets with higher liquidity where logging in and out is quite smooth and predictable. However, this strategy needs experience and an analytical skillset. Hence, it is not recommended for beginners to try out. In addition, this technique is more suitable for large traders.

Bottom line

The aforementioned strategies are for both newbies and experts willing to do crypto trading with determination and passion. However, devising a technique while keeping in mind the budget, personality style and financial goals is a daunting task. So, try to follow the suitable strategy without breaking any rules then analyze the performance.

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