Trading cryptocurrency is often misunderstood, and not a lot of people know that it’s actually easier compared to stock trading.
Also, there’s a lot of trading styles and approaches in crypto trading. The next time you put in money in Bitcoin or other tokens, try these strategies:
Yes, that’s hodling and it’s not a typo error. This term actually means something similar to holding- you put your money into a cryptocurrency, forget about it and coming back to it months or years later.
Hodling is one of the easiest investment actions you can take in the crypto industry. You don’t have to check the value of the cryptocurrency daily and can focus on other things at hand.
Timing is everything in a hodl situation. You can use a trading software such as Bitcoin Compass to get a guaranteed profit every single time.
Scalping is a very active form of trading and involves the complete opposite of hodling. Here, the investor makes the most of his or her time in the cryptocurrency industry looking for opportunities here and there.
A scalping-type trader will utilize the latest trading software, such as Bitcoin Compass to see when a cryptocurrency peaks, as well as news and sites where expert advice is given. To take advantage of the sudden rise and sell the asset quickly before it dips to a low value is all in a day’s work.
Day trading is when you look to buy and sell cryptocurrency to make a profit within a set amount of time, e.g., an ‘8 to 5’. It’s a kind of short-term trading for those who want to earn a bit of money without it becoming too much of a time sink.
Day trading and scalping are similar in a few elements in that they go for a profit whenever the opportunity presents itself. Holding on to a cryptocurrency for too long is generally frowned upon. Then when all is said and done they convert their earnings to fiat currency and store it in their bank accounts.
Position trading is a long-term trade where the investor is busy with other responsibilities, like a family or a day job. They check their cryptocurrency’s performance every now and then, and as long as it hasn’t dipped or soared in value they’re more than content to leave their digital assets as is.
When position trading it’s best to invest in stable cryptocurrencies, or the ones who have a long-term gain projection. When doing research, the first question that comes to mind is- how will this token rise in the near future? This is answered by doing research or checking with experts or a trading software.
Usually done by experienced investors, swing trading involves setting up hold and sell parameters and waiting months to take a profitable action.
Swing traders are more patient in that they hold fast when a cryptocurrency’s value goes down because they know it will go back up to their desired value. When the target number is achieved, this is the time they make a transaction.