Cryptocurrency traders have been on an exciting journey since the advent of digital currencies. Bitcoin hit $1 trillion in market value for the first time in February 2021.
However, the market is rapidly changing thanks to new regulations, technological advances, and the growing interest in digital currency.
With the increasing popularity of crypto trading and the potential for high returns, traders must understand the best tactics for trading and make the most out of the market.
Most crypto traders stay up-to-date with the latest trends and tactics to ensure successful trading.
In this article, we’ll explore the crucial strategies every trader should know.
Cryptocurrency trading: how to buy Ethereum with a credit card
Fashion will continue to lead the way in Web3 adoption –Cathy Hackl.
2023 is a significant year for the cryptocurrency market. A notable projection is that the fashion world will embrace web3. Smart investors are investing in different cryptocurrencies to join the web3 trend.
Several crypto exchange platforms allow you to buy cryptocurrencies with your credit card. Here’s How to buy Ethereum with a credit card and join the crypto revolution.
1. To purchase Ethereum with your credit card, enter the amount in ETH you wish to purchase
2. Put in your ETH wallet address
3. Confirm your email and the necessary information
You can pay for Ethereum with your credit card or other payment methods.
Crypto tactics and strategies refer to proven methods or roadmaps developed by a trader according to his risk profile that helps in successful trading and risk management.
There are no fixed best tactics, but the best tactics for crypto trading come from years of experience trading and analyzing the market. It’s vital not just to have tactics but ones that work.
The following are tactics that prove to work:
Arbitrage is when a trader tries to maximize the price differences of a particular crypto across various exchange platforms. For example, bitcoin is trading at $15,000 in one exchange platform and $15,500 in another.
The trader will maximize these disparities in price by buying from the lower exchange and selling off at the higher deal, thereby making some profit. Arbitrage is a term that is adopted even in traditional investments.
Arbitrage trading involves little or no risk, and the beautiful thing is that you don’t have to be an expert or have lots of funds to start arbitrage trading. Some traders ignore arbitrage trading as a profitable strategy due to the transaction fees of the various platforms.
Scalping is the process of positioning in line with a trend. It involves entering and quitting the market several times in a short period as it develops. Scalping is one of the shortest-term strategies– individual trades are held for only a few seconds or minutes at most.
For active day traders, this trading method performs exceptionally. Scalping concentrates on minute-to-minute price variations due to changes in volume. You will close the deal as soon as it starts to make money.
There’s nothing like “waiting for the market to represent trends” since you must act quickly and exit failing trades. Scalping works best when the market is highly volatile. A trader needs to understand that every strategy has its own risk. It’s essential for you as a trader to manage your risk.
This strategy involves buying the cryptocurrency you’ve chosen to trade when there is positive news and selling it off in the case of adverse or suspicious information.
Some traders call this “fundamental analysis,” Markets for cryptocurrencies may be impacted by a particular coin’s or exchange’s significant media exposure.
The main goal of this cryptocurrency trading method is to profit from these “events or news.” The influence of this news isn’t just speculation most of the time.
Before an anticipated news release, such as an earnings report, you will have to watch the market for a consolidation pattern and then take action as soon as the market breaks out. Due to the volatile nature of cryptocurrencies, you have to wait to participate in a trade until after such a press release.
Dollar-cost averaging is a popular tactic for experts and beginners. It’s a trading strategy that doesn’t involve indicators.
DCA utilizes a simple process. You divide your investments into smaller sums than putting all of your money into one asset. These funds are allocated over a set period and consistently invested on a specific day and time per week.
Why use DCA as a trading tactic?
Regularly purchasing an asset reduces the effects of market volatility. Hence, you get more money back from your final investment than putting in all of your money at once.
2022 wasn’t as exciting for crypto traders. The Crypto market lost 55% of its capitalization in 2022, with bitcoin dropping below $24. However, some traders are taking advantage of this fall to make more investments.
1. Sign up for a cryptocurrency exchange
The ultimate step in trading cryptocurrencies is to create an account on a crypto exchange. Cryptocurrencies aren’t traded with fiat directly from the bank; a crypto exchange platform is essential in selling crypto assets successfully.
A crypto exchange is a platform where users can purchase and sell cryptocurrencies. Examples of such outlets include Moonpay, Binance, and Coinbase. To register a crypto exchange account, you need to provide some personal information, like your date of birth, home address, Social Security number, and email address.
2. Deposit into the account
The next step after creating an account on an exchange is to fund the account. There are several ways to finance the account, but connecting the trading account to a regular bank account is the easiest.
Transmit your fiat money using a debit card, wire transfer, or bank deposit. Thanks to its little to no fees, a wire transfer is the least expensive alternative for funding your account.
Pro tip: check different exchanges to compare transaction fees and pick the cheaper and more favorable option.
3. Choose a cryptocurrency to trade
The next step after funding the account is to choose a cryptocurrency to trade. Picking the right crypto asset to trade depends on several factors that a trader should know, which include: the market cap of the cryptocurrency, fundamental news, market sentiment, and technical analysis.
Most traders prefer to trade bitcoin and Ethereum due to their enormous trading volumes over other cryptocurrencies.
However, many cryptocurrency traders devote some of their funds to minor cryptocurrencies. Whether you stick with minor coins or choose substantial and stable cryptocurrencies is for you to decide.
4. Develop a strategy
You must have tactics tested and confirmed over time to work effectively in every investment.
A strategy involves the methods, or roadmap traders follow to manage funds and mitigate financial risks while trading. These tactics are critical to avoid unnecessary losses and fit into your risk profile.
5. Start trading
After the account and tactics for trading are all set, you’re good to commence trading. It’s time to get busy with the cryptocurrency you decide to buy and sell based on your risk profile, strategy, knowledge, and abilities.
Cryptocurrency trading is active or automatic. Trading bots are the most straightforward and efficient approach to automate this procedure though they have their risks.
6. Store your crypto asset
You’ll need to keep your coins in a wallet while exchanging digital currencies. Apps for crypto exchanges are not wallets in the real sense. They don’t store your cryptocurrency coins but hold them.
Crypto wallets come in two forms, hot wallets, and cold wallets. Hot wallets are the various wallets offered by crypto exchange platforms for you to keep your crypto assets, and they require an internet connection to function.
Cold wallets don’t require an internet connection to function. Yubo Ruan, CEO and founder of Parallel Finance, a decentralized lending and staking protocol on Polkadot, says it’s better to hold roughly 80% of long-term funds inside a cold wallet. The remaining crypto assets stay in a hot wallet for short-term moves.
While many traders lost hope in 2022, 2023 will depend on regulations and government policies. As we move towards 2023, traders must adopt crucial tactics to get the most out of crypto trading and maximize their profits.
As we outline the best tactics for trading, every trader will have to stick to the tactics that work for them. The Crypto market is far from a Ponzi gimmick, and expert traders invest for long-term purposes.
It’s great for traders to learn to manage greed and fear, as these two factors are crucial in successful trading.
Keep in mind that we may receive commissions when you click our links and make purchases. However, this does not impact our reviews and comparisons. We try our best to keep things fair and balanced, in order to help you make the best choice for you.
