How to trade bitcoin? Bitcoin trading is the way you can speculate on the price movements of the cryptocurrency without owning the Bitcoin.
While this involves buying Bitcoin through an exchange, in the hope that its price will rise in time, cryptocurrency traders are increasingly using derivatives to speculate on rising and falling prices – in order to make the most of bitcoin’s volatility.
Bitcoin trading steps for beginners
In the following lines, we will mention the Bitcoin trading strategy:
Bitcoin day trading strategy
How to trade bitcoin today, it means that you will open and close a position within one trading day. So you will not have any fluctuations in the bitcoin market the next day, this means that you will avoid transaction installation fees.
This strategy may be right for you if you are looking to profit from short-term bitcoin price movements. It can enable you to get the most out of the daily fluctuations in the price of Bitcoin.
Bitcoin trend trading strategy
How to trade bitcoin A trend is to take a position that corresponds to the current trend.
For example, if the market is in an uptrend, you can buy and if the trend is downward, you can sell.
If the trend starts to slow down or reverse, you can consider closing your position and opening a new position to match the emerging trend.
Bitcoin hedging strategy
How to trade Bitcoin as a cryptocurrency hedge and mitigate your exposure by taking a position opposite to an already open position. You would do this if you were worried about the market moving against you.
For example, if you own some bitcoin but are worried about a short-term drop in its value. You can open a short position on Bitcoin using CFDs.
If the price of bitcoin falls in the market, the gains on your short position will offset some or all of the losses on the coins you own.
HODL Bitcoin Strategy
How to trade bitcoin with the “HODL” strategy of buying and holding bitcoin.
Its name is derived from the misspelling of “Hold” in the cryptocurrency market, and is now often said to mean “hold on to the beautiful life.”
However, this statement should not be taken lightly – you should only buy and hold bitcoin if you have a positive long-term view of its price.
If your research or trading plan says you should sell your positions to take profit or limit loss, you should – or you can set a stop loss to automatically close your positions.
Bitcoin trading steps for beginners
We will mention the best bitcoin trading methods:
Bitcoin Trading
Trading Bitcoin CFDs means that instead of owning a particular Bitcoin, you will speculate on its price using CFDs.
As a result, you will be able to take a position on the rising price of Bitcoin by “buying” or falling by “selling”.
Here are the other benefits of trading Bitcoin CFDs with us:
- Leverage and Margin: CFDs are always traded with leverage, which means you will only have to make a deposit – known as margin – to get full exposure to the market.
- Deep Liquidity: Our Bitcoin market is highly liquid, which means that your orders are more likely to be filled at the price you want - even if you are trading high volumes.
- Hedging: Short selling using CFDs can be an effective way to hedge your portfolio and protect against a market downturn.
Buy Bitcoin through the stock exchange
Buying bitcoin through the exchange is mainly for those who use the bitcoin buy and hold strategy.
This is because buying through an exchange means that you get direct ownership of Bitcoin - with the expectation that its price will go up.
However, there are some problems with buying bitcoin through the exchange:
- Bitcoin exchanges often lack the proper regulation and infrastructure to respond quickly to support requests.
- The matching engines and servers on bitcoin exchanges are often unreliable, which can cause markets to hang or reduce execution accuracy.
- Bitcoin exchanges often charge fees and restrictions for funding and withdrawals from your exchange account, while the accounts themselves can take days to open.
Crypto 10 indicator
In addition to trading Bitcoin CFDs or buying currencies directly from the exchange, you can trade the Crypto 10 Index which gives you exposure to 10 major cryptocurrencies such as Bitcoin in a single trade.
This indicator speculates on these cryptocurrencies and closely tracks or reflects the underlying market price.
Can I profit from bitcoin trading?
You can certainly benefit from bitcoin trading, and your ability to make a profit will depend on your depth of market analysis, your knowledge of the market and the underlying market conditions.
How does bitcoin trading work?
Bitcoin trading works by enabling you to take a speculative position on Bitcoin price movements.
Is Bitcoin trading safe?
Bitcoin trading can be risky due to the volatility in the market.
What is the best time to trade bitcoin?
Although the cryptocurrency operates 24 hours a day, seven days a week, some hours will see increased volatility and liquidity.