What cryptocurrency strategy are you using? Or what failed cryptocurrency strategies have you once used? These questions are meant to examine our journey in the cryptocurrency market and to help with making trading adjustments. Trading in cryptocurrency should be approached with the best strategies because of the high volatility of the market.
Nowadays the invention of mobile crypto apps that help us stay up-to-date with the current price level in the market has made cryptocurrency trading more profitable. So, whether you are heavily trading or making some extra bucks from cryptocurrency, investing in cryptocurrency should add value from your initial start-up coins. Now, here are some ways to help your cryptocurrency trading more profitable.
1. Do some feasibility study about the coin
Let’s say you want to invest in cryptocurrency or you have already made a mistake by investing in one particular cryptocurrency. Today in cryptocurrency, we have hundreds of coins, and each has its own said peculiar selling points. But the main question is how potent can the coin be in the market or what is the coin’s acceptance ratio? How secure is the platform How well it’s being reviewed?
Carrying out research on the coin before investing can help you gain an insight on the earlier above questions. This would help you not to be easily carried away with FOMO influencing and Fear of Uncertainty and Disinformation. Some people that started off investing a little, even went as far as participating in ICO and observed its trend for a particular duration before investing huge. It is now very easy to follow the trend and know the most profitable cryptocurrency by joining good Facebook groups and gaining knowledge from experts who know all the current cryptocurrency trends in order to make a profit with your trading strategies.
2. Use a good price checker
The race on investing in cryptocurrency starts from when you fund your account and start trading. Making some profits from trading on cryptocurrency requires dedicated time and tracking all your investment and current market value and prices for your market. Some price checkers can provide you with an instant value of any cryptocurrency in your portal. This works with giving you updates by checking on the price for over 1000 crypto coins and a lot of exchanges. Some provide you with price graphs to understand the best times for trading.
3. Playing intelligently with bot trading
Bot trading involves the use of software to talk to an exchange via API. This API which is an Application Programming Interface allows it to send and receive data exchanges. Some software is built with this trading bot to help you execute trade online based on parameters defined by the programmer or the user. For example, the bot can be programmed to buy when coins are low and sell when it is high.
Bot sometimes can be very helpful, but playing intelligently on using a particular bot trading software can save you from losing your profit. 3Commas is one popular trading bot that is used by amateur traders and it works best in both mobile and desktop. It also works well on exchanges like BitFinex, Bittrex, Binance, Kucoin and a host of others. Because of how reliable they are, it allows you to programme it at stop-loss and take-profit target and they are even capable of giving an insight of strategies from successful traders.
4. Build Confidence in your HODL
This principle was created by Tom Lee, which can be translated to ‘Hold On Dear Life’. This strategy is what is commonly known as Buy and Hold. As quoted by the expert, “ The reason ‘buy and hold,’ makes sense for Bitcoin is that only a handful of days of the year account for the bulk of gains for Bitcoins.” This quote addresses the prospect of cryptocurrency particularly bitcoin in the nearest future for investors. While people see this as the easiest strategy. buying and holding are not entirely meant for everybody but only for those with confidence to reap a more tremendous profit in the nearest time.
5. Running a masternodes
Node technology was first used in the Bitcoin blockchain system. But other cryptocurrencies like DAS uses the masternode system of the blockchain. Masternodes are highly valued because of the extremely fast transaction speed, privacy in the transaction and the entire system, and instant transactions. The running of this masternodes in some cryptocurrency requires a fixed capital or an investment of 1000 DASH, IP address, server to host the wallet. Apart from the importance of masternode earlier stated, masternode runners, are provided with incentives either on a monthly or weekly basis. But note, not all cryptocurrencies run a masternode, so you should do a detailed study on their features to know what coin run.
6. Make a profit with the help of cryptocurrency arbitration
Arbitration is cut across all forms of trading in the market whether forex or cryptocurrency. This involves buying at a lower rate and from a seller on another market at a higher rate and analyzing the profits of the spread. Let us consider a cryptocurrency site Kraken with Litecoin may cost $8000 while Dash -$7500 at the instance. You can buy Litecoin on Kraken, sell on Dash to bring profits in a convenient payment through an exchanger. In which market fees apply. But for BTC-e withdrawal fee is 0.2%. But we should be very careful about the volatility of the market because the price of cryptocurrency is constantly changing.
7. Invest in a different market
Gone are the days when people are accustomed to just investing in one market system. This system has led to the major loss of huge investments. Today the easiest way to make profits and still have your invested capital is by investing in more than two coins. This diversification process helps in spreading investment across coins and to carter for gains or loss from any of your coins.
8. Take opportunities from your profits
There is always a natural greed inside us that plays a major role when all things become sunny in cryptocurrency. Being greedy can wreck a huge profit margin in cryptocurrency and result in a loss for not taking opportunities. For example, taking a profit of 20% from your crypto trading should not be a bad idea rather than risk the chance of losing your entire profit. You can always restructure your cryptocurrency trading goals in order to reduce the tendency of losing profit if things change along the line.