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There are many styles of crypto trading, and a trader should choose one that suits his goals, character, experience and skills. Using the wrong style will not most likely give positive results. And you should study the popular styles and try each of them in order to choose the best option. We will cover three common trading styles that are suitable even for beginners.
Long-term investments involve the formation of an investment portfolio for long-term retention from three to six months. The principle of a trader choosing this style is “buy and hold”. Experts often mean the stock market, speaking of long-term investments, but this tactic is also suitable for cryptocurrency. For example, Bitcoin at its peak exceeded the value of all top stocks, bringing a lot of money to its owners.
Advantages of long-term investment:
earnings without stress, no need to monitor the state of the market and quotes constantly;
simplicity, saving time on learning various trading strategies;
savings on taxes (if you look at the whole, and not specifically in each country);
the ability to receive passive income by renting crypto to the landing page for crypto traders.
There are two types of short-term trading – day trading, when a deal is opened for a day, and swing trading, when a deal is active for one to three days.
Day trading involves opening dozens of trades during a trading day. This style is more difficult unlike a long-term investment; it requires more effort and time for the beginner to learn. A trader has to use technical analysis and complex charts – this is his daily routine, helping to close deals profitably.
The trader’s task is to earn as much as possible in one trading day by opening a large number of positions with minimal risk.
Swing trading, where positions are held for several days, involves opening fewer trades than day trading. The trader seeks to get the maximum profit with the minimum number of transactions choosing this style. Trades are opened and closed based on technical analysis.
Advantages of short-term trading:
a good opportunity to gain experience in a short period;
comfortable pace of work.
Scalping is the most stressful trading style that we are looking at. A trader who chooses this style should hold positions for a few seconds or minutes. The task of the trader is to open the maximum possible number of small and risk-free positions in order to reach a good income at the end of the session.
Traders using this style catch small rate impulses caused by various factors. Scalping is suitable for those who feel comfortable in extreme situations and have high stress resistance.
Scalping can be different, its types:
Trading with a range limit. Is meant the change in the course within the given levels for a certain period by “range”. You can open long and short positions depending on the value of the asset.
Bid-ask spread. The scalper must open a trade at the bid or ask price, and close it as quickly as possible a few points higher or lower, having chosen this tactic.
Arbitrage speculation. The player can open transactions on several exchanges at the same time, protecting the deposit from fluctuations in the exchange rate. He can open paired arbitrage within the same platform, for example, USD / BTC.
The benefits of scalping:
fast gaining experience;
intensive study of the mechanics of the cryptocurrency market, methods of analysis;
good psychological preparation for further major transactions;
opportunity to earn with a small initial deposit.
The Crypto Crew team will help you to master the above and other styles of cryptocurrency trading. We have created the first crypto community in Ukraine and an effective training course for beginners. You will master the basic skills of a trader in just a month studying with us and will be ready to act on the stock exchange on your own, making a minimum of mistakes.