Cryptocurrencies have become so firmly entrenched in the everyday life of the “inhabitants” of the Internet space that they have become not only a means of the mutual settlement but also one of the keys earning tools. Probably, there are no longer those who are skeptical of Bitcoin and do not believe in its strength – even at the state level in many countries, cue ball has been accepted and encouraged. But not the distribution of this cryptocurrency and its merits will be discussed in the article, but about what opportunities this currency opens up for those who want to earn money on it. Want to learn how to trade bitcoins on the exchange? You have come to the right place – this article will reveal to you the basic secrets and strategies of this artful craft.
Is trading bitcoins on the exchange profitable?
Like any other currency, bitcoin can change its course. And, while most fiat currencies are relatively stable, then with the cue ball everything is exactly the opposite – it is very volatile and can “jump” even for one hour in various directions. This ability of cryptocurrency to change is a real find for those involved in its sale, and these very traders are actively exploiting this opportunity. And it’s a sin not to take advantage of the fluctuations in the rate of this crypto sign because there are a lot of those who literally, buying cue ball in the morning, and selling it in the evening of that day, made a fortune.
Despite the fact that Bitcoin offers a lot of opportunities for earning – from mining to investment, nevertheless, classical trading brings the most tangible and easy profit. Do not think that trading on the cryptocurrency exchange is an activity for respectable uncles who have huge thousands of capitals – anyone can become a trader, for this, all the opportunities are provided on the network.
What do you need to know to trade on the Bitcoin exchange?
If you are determined to go, cryptocurrency traders, you should know that the most important thing in this business is composure and prudence. Often, trades require enormous exposure, and many novice traders who do not possess such qualities simply merge their bank, starting a panic and urgent sale of their bitcoins or their purchase. Each decision should be the result of in-depth analysis and calculation, otherwise, you simply lose your bank.
In fact, trading cryptocurrency is no different from trading fiat money: you need to find cheaper, and sell more expensive, in fact, the difference between these operations will be the income of the merchant. In a word, such bidding is nothing but pure speculation, but in the positive sense of the word (not to be confused with illegal and immoral actions of the times of the USSR).
The first and key task for the trader is to choose a noteworthy exchange, which will really allow you to earn and pay your profit. Today, there are a huge number of such intermediaries between the trader and his success, the article will discuss them more specifically later, but without exception, the exchange is united by the fact that everything happens the same everywhere, and the terminology used during the auction is identical:
- Order – an order to complete a transaction. In order to buy or sell a currency, you need to place an order. A distinction is made between a buy (buy) and sell (sell) order.
- Spread – the difference between the purchase amount and the cryptocurrency sale amount, that is, in fact, the trader’s income from the transaction.
- Chart – graphical fixation of the Bitcoin exchange rate to the dollar. Charts can be presented for different times, and the most short-term – from a few minutes – are the most indicative of the trader.
- Market depth – the ratio of the number of orders placed for purchase and sale.
- Japanese candles – a chart display format in which the most complete picture of the market is created. The body of the candle (indicated by a rectangle) indicates the price at the time of opening and closing, while its shadow (line) shows the minimum and maximum value.
- The bull is a trader who earns on the growth of cryptocurrency value.
- A bear is a merchant who earns on the fall of bitcoin in price.
- A spinning top is a trading situation when the shadows of the candles are the same, which indicates uncertainty in the market.
- A pending order is a purchase order that will be executed when a certain condition (specific price) occurs.
How to trade on the Bitcoin exchange: tips
Although trading on the exchange is accessible to everyone, you should not think that it is elementary simple, and you will not have to make any strategies and mental efforts. If you react to the task negligently, then very soon merge your entire bank and you will regret that you decided to become a trader. To avoid disappointment, and your money multiplied, you should follow these tips:
- First of all, thoroughly approach the study of theory – without this, nowhere. You need to know the basic terms, interpretation of the chart and candles, types of orders, etc.
- Immediately find out what size of the commission is on the exchange – as a rule, you will have to pay both money input and withdrawal from the exchange, therefore, in order not to be disappointed, calculate in advance how many percents of your profit will be spent on paying for services.
- Do not try to vang and predict course movements – this is stupid. Better take the time to technical analysis and try to explain past events. This will give an understanding of how various factors influence the situation, which will help to trade competently.
- In pursuit of quick loot, do not forget that the rate is very unpredictable and, while you make a deal, it can significantly change its motion vector. The arbitration will protect your funds – just keep money on cryptocurrencies and fiat money on different exchanges.
- Even on the exchange opportunities for diversification – keep your money in different currencies, the spread between Bitcoin, laytkoinom, ether, rubles, and dollars (the options may be different).
- The most basic rule – do not lose your head and always remember that panic is your worst enemy.
- Well, as in any investment, the rule of free money works: use only the amount that you are willing to lose, and which will not lead to the apocalypse of your family budget. As a rule, those who put everything that they have, remain the losers, because it attempts to return the money as soon as possible, they make short-sighted and unreasonable decisions that lead to collapse.