Cryptocurrencies are all the rage right now, and it’s not their first time. Bitcoin has broken the $30,000 mark during 2020. Naturally, this has driven interest back to cryptocurrency after years under the radar.
Of course, many of these people, experts and beginners alike, look to make a living out of cryptocurrency. Well, it’s possible if you learn how to trade crypto. We will tell you how to day trade crypto here.
How to day trade crypto: A quick look into day trading
Day trading is among the most popular trading approaches, especially with cryptocurrency. That’s because you usually see profits more often, and it’s usually more akin to the classic trope of a trader watching charts all day.However, it’s also a complicated trading method. Fees are a lot more important, and the same is true for swings and dips.
What is day trading?
When looking at how to day trade crypto here, remember that day trading refers to buying and selling assets within a day. You open and close operations daily, and you shouldn’t have any open trades as the day begins or ends. Naturally, daily margins aren’t noticeable. That’s why leverage is a huge advantage for day traders.
Why should you consider day trading?
So, how to trade cryptocurrency? Day trading isn’t a walk in the park. You need to spot minuscule trends and dips within a day. However, day trading allows for instant profitability when done properly. Good use of leverage can yield better returns than medium- and long-term trading approaches.
What should you look out for?
However, daily trading is one of the most challenging strategies, but it’s mostly because of the dedication and knowledge necessary. You need to set specific schedules for trading, and you have to study chart analysis and other techniques that enable you to assess daily fluctuations.
How to trade crypto daily: Taking your first steps
Now, if you want to know how to trade crypto daily, you need to cover several aspects. It’s easy to see the mighty crypto coin as just a trend. Many countries, including the USA, have failed to consider the long-term implications of cryptocurrencies.
That definitely doesn’t mean cryptocurrency is a fade. Experts have debated about cryptocurrency vs. fiat, including USD. Seeing how it poses a legitimate business opportunity, let’s go through the basics.
Study the fundamentals
Sure, you might already know that trading is about selling or buying, depending on the market. Crypto trade has its own quirks. You need to learn about economics, what can change the value of your crypto asset, how to use your wallet and online brokers, and how leverage works. You need to know how to trade crypto for a living in the longer run.
Stay on top of relevant news
Another thing to know when you are trying to discover how to trade cryptocurrency is to know that trading by following the news isn’t foolproof. However, learning about economic policy reforms and other financially-relevant events is a key advantage. You can anticipate swings and adapt to them for reaping the profits.
Learn how to read charts
Another point to note when it comes to an understanding how to trade crypto is to know that chart analysis comes from legitimate data in the market. That’s why knowing how to find patterns gives you unique insight. After assessing world events, the best next step is to watch your charts and see if your predictions were true.
Allocate a dedicated budget
Another thing to note on how to trade crypto daily is that you shouldn’t push money into your account randomly. Make sure you have a separate budget solely for trading. It doesn’t have to be huge, for starters, and a good start is to set aside a small income percentage and reinvest your earnings.
Create a schedule
Don’t fall for checking your trading dashboard now and then. You need to pay constant attention to the market if you’re trading daily. Therefore, create a specific trading schedule where you can focus solely on assessing your positions.
Develop your own approach
Copying experts is a great way to take advantage of their success while learning. However, everyone is different. Your needs, goals, risk tolerance, budget, and similar aspects will determine the ideal methodology for you.
How to trade crypto for a living: Our recommendation
The most important first step—even before trading crypto coins—is to get a good wallet. Without a good crypto wallet, you’re compromising all your earnings. The Trustee Wallet is our main recommendation for day traders.
Firstly, it’s open source, so it offers unique security and verification benefits above commercial brands. You can keep different crypto coins within the same wallet, and you can convert your virtual assets without leaving its intuitive dashboard.
Living from trading is possible, and that includes cryptocurrency. Besides having a good wallet, all other rules of trading apply to this market.
Take it seriously
If you want to make a living trading, you have to acknowledge it’ll become your job. Seeing it as a hobby or gambling is fine for entertainment, but that’s not a good approach. Create schedules and discipline and stick to them.
Don’t stop learning
Day trading is for experts, and that means you can’t fall behind, even if you feel you know everything. Keep practicing your strategies with demo trading platforms, and keep studying economics.
Develop your own strategies
You can start out by copying strategies from trading experts. That’s a common start, but it also means lots of people do it. Developing your own approach ensures you feel comfortable trading and have a strategy that not many people know.
It’ll take a while before you can make a living with the crypto trade. You need to study and make plenty of mistakes. You’ll definitely lose money while starting, so make sure to control your budget. All of these errors are part of learning, so don’t give up.