Making money from Cryptocurrency Trading, The Specie Diaries

My experiments investing and copytrading

Making money from Cryptocurrency Trading

Is it indeed possible to make money from cryptocurrency trading? Is it a legitimate long term strategy for wealth creation? I thought I’d waterput together a postbode rounding up the current state of cryptocurrency trading and how you can get embarked.

Figuring out when to buy and sell

This indeed is the million dollar question! And obviously I can’t give you an effortless response. Attempting to predict which direction a cryptocurrency will stir is indeed difficult. No one can be certain either. You can however learn some basics of fundamental analysis. Digital currencies will budge based on fundamental factors. For example, recently a popular digital currency exchange announced they would be supporting Litecoin. And spil a result the price of litecoin leaped. This wasgoed a fundamental force – te this case, a popular exchange would increase the request of litecoin and therefore more supply would be needed, pushing the price up.

Thesis sort of fundamental compels are what you need to be looking out for, if you want to be a successful cryptocurrency trader. This means staying plugged into news, understand how the currency actually works, and becoming familiar with charts and how to read them.

Trading Cryptocurrencies at an exchange

Trading cryptocurrencies at an exchange is much like trading forex. You’re basically looking to profit from the movement of one currency against another. Most of the time, you’ll be trading bitcoin against the USD or bitcoin against another cryptocurrency.

There are a lotsbestemming of exchanges online, but there are only a duo I would actually trust. Ter the past, exchanges have shut down out of the blue and taken everyone’s currency with them. The anonymous nature of cryptocurrencies, means this is an added risk.

I presently use Poloniex. Albeit I trust them more than most exchanges, I still wouldn’t leave a large amount of currency sitting te my account. On Poloniex you can trade all the major cryptocurrencies and the markets are fairly deep, meaning your orders won’t sit around unfilled.

If you’re fresh to trading, then attempting to trade on Poloniex or another exchange will be fairly daunting. None of the exchanges have good interfaces. And unluckily, unlike forex or stock trading, where you can practice with pretend money, this simply doesn’t exist on thesis exchanges. So I would only recommend signing up to somewhere like Poloniex, if you have trading practice.

Trading CFDs on eToro

Holding a loterijlot of any one cryptocurrency can be risky. But it’s still entirely possible to trade cryptocurrency without actually wielding any. When you trade a CFD, you are speculating on the price of an underlying asset. CFDs are a very common investing product – people have bot able to trade CFDs te stocks, commodities and other traditional assets for a long time. More recently I’ve bot witnessing CFDs popup for cryptocurrencies spil well.

eToro wasgoed one of the very first places to suggest CFD trading for Bitcoin. And recently the’ve added other cryptocurrencies too including Ethereum.

One major advantage of CFDs is that you can take either long or brief positions. You would open a long position (buy) if you thought the price would rise. And you would do the opposite, go brief (sell) if you thought the price would druppel. This way you can profit no matter what direction the asset is moving. Talented traders will be able to profit even if the price of bitcoin or another currency is falling by opening brief positions.

With CFDs you won’t pay any large exchange fees. There is usually a weekend holding toverfee and you pay a spread. The spread is simply the price difference inbetween the buy and sell prices.

Trading CFDs on Whaleclub

On eToro, you’re trading using fiat currency, such spil USD. On Whaleclub, you trade exclusively ter digital currency. The only deposit option is via Bitcoin or Dash.

You still trade CFDs, just like on eToro, but the base currency will always be Bitcoin. This can take a little bit of adjusting to get used to, but essentially trading is much the same. Because whaleclub deals entirely te digital currencies, you don’t need to go through the same verification processes that you would on more traditional trading platforms. Te fact, whaleclub prides itself on its level of privacy.

Buying and Holding a Cryptocurrency

I don’t know if wij’ll see another cryptocurrency launch with the potential to dual your money hundreds of times overheen. Those days maybe gone. But if you are bullish on a currency then holding onto it, and hoping the price will rise could still nipt significant comes back.

Some people have crazy predictions for bitcoin, and believe the price will soar overheen a million dollars. I, just like everyone else, can’t say if that will toebijten. Essentially it is a gamble. Most people who are making money trading bitcoin are doing it by the volatility that happens everyday, and not just holding onto a coin. But spil I’ve said, I still think there is money to be made ter holding.

Holding is very likely the easiest strategy for new-comers. Trading is difficult and time consuming. Where spil anyone can lightly purchase bitcoin ter a few minutes. But spil a beginner, its significant to reminisce that there is meaty risk involved. There is no assure the price will rise, so never invest more than you can afford to lose.

Hopefully this will inspire you to look more into cryptocurrencies. There are many different trading options, and I’ve introduced just three – mainly because I’ve used all of them and do trust them. Let mij know ter the comments how you are trading cryptocurrency.

All trading involves risk. Only risk capital you’re ready to lose. Past voorstelling does not assure future results. This postbode is for educational purposes and should not be considered spil investment advice

CFDs are leveraged products. Trading ter CFDs related to foreign exchange, commodities,indices and other underlying variables, carries a high level of risk and can result ter the loss of all of your investment.

Related movie: How Bitcoin Works ter Five Minutes (Technical)

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