If you’ve been following cryptocurrency news lately, you’ve probably heard about the so-called “crypto winter.” In 2018, the value of digital currencies like Bitcoin and Ethereum plunged. With the bear market came a lot of negative press and a general decline in the public interest. But while it may seem like Cryptocurrencies are in trouble, they could be on the rebound soon. With that in mind, have you ever wondered if you can make money day trading Cryptocurrencies? That is, buy low, sell high—and make lots of money in the process? If so, this article is for you! Let’s take a look at five things you need to consider before day trading Bitcoins.
The exchange platform you’ll need
There are dozens of exchanges that you can use for day trading Cryptocurrencies. Some are better than others for a variety of reasons—like reliability and fees—so it’s important to choose an exchange where you can put your money and have confidence in it. Bitcoin Evolution is the most beginner-friendly cryptocurrency exchange out there. To get started, you only need $USD to open an account, and then you can buy Bitcoin with a credit card. And once your coins are deposited, you can trade them at your leisure, whenever you want. This exchange is also one of the least expensive trading platforms out there. Again, you can withdraw your funds at any time.
The cryptocurrency you’ll use for your day trading strategy
A cryptocurrency’s value fluctuates all the time. While it’s not always easy to capitalize on these fluctuations, they’re what give day traders an edge. And because so many people are interested in Cryptocurrencies now, there are more opportunities to trade than ever before. Investors can choose to trade Bitcoin, Ethereum, or over 80 different Cryptocurrencies. But most day traders use either Bitcoin or Ethereum for their strategies. Why? Because Bitcoin and Ethereum are two of the biggest Cryptocurrencies out there and are therefore more likely to be actively traded by day traders.
Start with a research exercise
Now that you know which exchange you’ll be using and which cryptocurrency you’ll use for day trading, it’s time to start researching how to get started. How do you learn to trade? You start by reading about trading strategies and learning about the basics of chart interpretation. Day trading is confusing enough that you need to learn a lot about it. Start with an online course, read a book, or take a course. You can also click here to get a free one-on-one mentorship with a professional trader. In that mentorship, you’ll learn how to use the trading tools and strategies you’ll need to get started.
You Should Know – How Are Cryptocurrencies Taxed?
Know the risks of day trading
Before you invest time and money into day trading, you need to know the risks. Day trading can be very risky. A research study found that day traders experienced a whopping 88% loss of their investment over the long term. That’s a high risk. That’s because day trading is trading very small amounts of money. So if the market turns against you, you could find it difficult to buy more coins. The good news is that most day traders lose money over the long term, so you don’t need to be one of them. If you’re interested in day trading, remember that it’s a high-risk strategy. Make sure you understand the risks, and that you’re willing to take those risks.
Wrapping up: Is day trading worth it?
When it comes to day trading Cryptocurrencies, the answer is “it depends.” It all depends on your risk tolerance and how confident you are in your trading strategy. If you’re willing to take high risk and have a very long-term investment strategy, then day trading might be worth it for you. That said, if you’re new to Cryptocurrencies and not sure how you’ll even get started, it might be best to stick to investing passively. If you’re interested in day trading, make sure you understand the risks first. And make sure you’re ready to accept the high level of risk.