Finance

Quick Start Guide to Bitcoin Trading

bitcoin

Bitcoin trading is quite simple once you understand how it is done. Being the leading cryptocurrency, it’s quite easy to buy and sell BTC when you want to. But aside from being the most widely used cryptocurrency today, there are other reasons why you should trade Bitcoin.

One of these is the fact that Bitcoin is available 24/7. Unlike stock markets, there are hundreds of cryptocurrency exchanges that operate 24/7/365 days a year. So, you can buy Bitcoin anytime. Cryptocurrencies like Bitcoin are also known for their volatility. These frequent and quick price movements can help you make a quick buck.

Bitcoin is capped to only 21 million coins supply. If there’s a demand for the coin, its value will significantly increase. Bitcoin owners can also transfer and access their coins from their cryptocurrency wallet using a private key. As long as they have this key, their coins will remain safe and untouched. For more information you can visit here bitcoin era

Where to Get Bitcoin

You can get Bitcoin through cryptocurrency exchanges. There are two kinds of cryptocurrency exchanges – crypto-to-crypto and fiat-to-crypto exchanges. Exchanges, such as crypto-to-crypto, help traders exchange certain cryptocurrencies such as ETH and BTC for other cryptos. Fiat-to-crypto exchanges, on the other hand, help traders buy cryptos in exchange for government-issued currency or fiat money.

How to Trade Bitcoin

The best trading method depends on how much time you’re willing to spend on trading and what you want to get from your investments. There are four major trading methods –day trading, passive trading, swing trading, and scalping.

  • Passive Trading

Passive trading is ideal for long-term holders or for those who simply want to get into the cryptocurrency market. The idea is very simple. You will buy Bitcoin at a low price and wait for the price to increase to a certain level, and then sell it. The duration between buying and selling Bitcoin can last for days, months, weeks, or years.

  • Day Trading

Day trading is perfect for those who want to make the most of the short-term opportunities that come about due to emerging patterns. In this method, you open and close your position within one trading day.

  • Scalping

Scalping involves making several intra-day trades on small price movements. This method is ideal for traders who want to make small, frequent profits from small price movements instead of waiting for a big opportunity.

  • Swing Trading

If you want tomake the most of market momentum, you should consider swing trading. This trading method is all about catching price movement trends and holding onto it until it experiences a reversal.

Technical Analysis vs. Fundamental Analysis

The most important tools that you should never forget while trading Bitcoin are technical analysis and fundamental analysis.

  • Technical Analysis

This helps predict possible future price movement of Bitcoin or other cryptocurrencies. The main idea behind this tool is that regardless of what’s happening in the Bitcoin market, price movements can help you predict what’s going to happen next. 

  • Fundamental Analysis

Fundamental analysis, on the other hand, is focused on the big picture. You’re looking at the coin’s mainstream integration. If a mainstream platform is using the coin, it’s going to affect BTC’s price. Fundamental analysis also looks at the developer’s activities surrounding BTC. Major world events can also affect the coin’s price.  That’s why you need to keep yourself up-to-date with all the current events in the world so that you can make a solid fundamental analysis.

Final Thoughts

Bitcoin trading can be a rewarding endeavor if you know what to do. You need to keep learning in order to gain more knowledge and avoid major losses. And never let your emotions dictate your decisions.

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