3 Tips to Develop Your Bitcoin Trading Strategy3 Tips to Develop Your Bitcoin Trading Strategy
With the surge that the Bitcoin has experienced in recent times, people are keen more than ever to dabble in cryptocurrencies. However, to trade well, you need a strategy and a good automated trading platform in place. Anon System is one of those platforms where the algorithm-based trading robot trades various cryptocurrencies including Bitcoin, Ethereum, and much more. Even if this is the case, never forget to take the test and read the user experience reports to see if anon system software is legitimate or not. There are some guidelines that you could follow to develop such a strategy. Bitcoin has been trading better than stocks, and the traditionally-popular gold that has always been considered a safe haven until recently when prices plummeted during the pandemic.
Bitcoin is founded on the blockchain technology that finds a lot of use in different industries. With this technology, it is possible to conduct transactions without a centralized authority and middlemen. You may buy bitcoin with prepaid card, which have a number of advantages over conventional payment options. Some cryptocurrency exchanges allow you to buy Bitcoin instantaneously and without verification using a prepaid card. You can only utilize the funds on your card, which reduces your debt risk. Here are some tips which you can use to have a Bitcoin trading strategy:
- Levels that you need to watch out for in Bitcoins: Trading is dynamic and therefore never boring. Trading involves two golden rules; firstly, that you must safeguard your funds at all costs and secondly, you need to make your money grow. Regardless of whether you are a newbie in trading or already following this as your full-time profession you must start with a high time frame. This helps you get an understanding of the entire market. You can identify what the critical price levels are in relation to an asset. When you have a higher ground you automatically enjoy an edge over the others; you can be the hawk that spots its prey from above. So, identifying opportunities becomes easier. If you start at low time frames, you will get distracted by the noise around you and overlook the bigger picture.
- You need to check Bitcoin’s price range especially on high time frames. This will offer you a good idea about the risks of trading Bitcoins and how volatile it is. A well-defined range will include easy-to-spot resistance and support levels. Traders often prefer to use SR levels and nothing else because these are extremely important. These levels indicate where the market’s big players have hot a stalemate.
- Thirdly, you must track correlations. The DXY indicator tells you the direction of the global economy. The USD is still the currency king primarily because it made up about 88% of total trades in Forex markets in April, 2019. Whenever the USD gains strength, the markets will pull back.
These are tips for developing a Bitcoin trading strategy. The crypto market is notoriously volatile and understanding it will go a long way in implementing the strategy. Many factors influence Bitcoin prices like supply, Bitcoin-related news, and major events like security breaches, regulation changes, or macroeconomic releases. No matter which strategy you adopt for trading Bitcoins, you must understand the method you opt for.
Before building a trading strategy it may be a good idea to make a trading plan. You need to be disciplined to follow this strategy. This ensures you do not make hasty and incorrect decisions by falling prey to emotions like greed and fear. You must set achievable targets before trading and carry out trading using a popular, tried-and-tested style. Your plan must consider your appetite for risks and focus on how much money you are ready to risk with every trade.