Trading cryptocurrencies is among the hottest trends in the investment landscape. Many individuals are earning money through trading and permanently reason. Cryptocurrencies could be traded 24 hours per day and aren’t controlled by financial institutions exactly the same way fiat is regulated by central banks. This eliminates issues such as price manipulation. Trading cryptocurrencies can be relatively simple and there are many opportunities in the market.
For a lot of traders, it makes sense to trade Bitcoin which is one of the many cryptocurrencies out there. Among the main reasons bitcoin robot for this really is that Bitcoin is one of the very volatile cryptocurrencies and it also will influence the performance of altcoins. This was evident in the 2017 cryptocurrency rally where most altcoins rallied because Bitcoin was rallying.
Getting into Bitcoin trading
By now you probably know that a number of the people that claim to possess made millions after buying Bitcoin managed to create that money simply because they invested when the buying price of Bitcoin was still low. Especially those who purchased Bitcoin before 2016 and held on looking forward to the price to attain epic heights.
Unfortunately, which was certainly one of a form opportunity for the cryptocurrency market and we saw the cryptocurrency crash in early 2018 and all of the gains were lost. However, you can still trade cryptocurrencies nonetheless it is better not to do it speculatively since cryptocurrency prices have now normalized.
Day trading Bitcoin
If you monitor the buying price of Bitcoin, you will notice that it has significant volatility anytime of the day. This causes it to be an attractive asset to trade in a fashion much like how forex pairs usually have volatile movements, only in cases like this Bitcoin might offer more volatility. So how does one take advantage of this?
You can use a Bitcoin trading bot which will do the majority of the job for you. Some crypto trading platforms promise to supply crypto trading bots that analyze the marketplace on your behalf, execute the trades and even close trades for you. All you need to do is to create the parameters to your preference and the crypto trading bot is going to do the rest for you.
You will have an excellent knowledge of how Bitcoin works and what really influences its price movements if you’d rather do the trading yourself rather than depend on a Bitcoin trading bot. Bitcoin’s volatility is principally caused by demand. The bulk buyers or large accounts are apt to have a significant effect on Bitcoin’s price direction. You can identify the direction in which the large accounts otherwise known as whales are trading and also trade inside their direction. You can access that data on platforms such as Binance Futures in the sentiments segment.
Using technical indicators
As far as the execution is worried, you can use technical indicators to recognize potential entry points. Remember that indicators alone aren’t very reliable, thus the need to combine them with other data, in cases like this, sentiment data on large accounts vs smaller accounts will make sense. One of the finest indicators readily available for trading Bitcoin is the On Balance Volume or OBV indicator.
OBV is a superb tool for predicting strong trends. Once the OBV aligns with the buying price of Bitcoin for a powerful bull or bear movement, then it is better to trade the direction of the trend. You can even overlay a Bitcoin Chart and that of Ethereum for another OBV strategy. This strategy is named smart money divergence and it is where the buying price of Bitcoin and ethereum are generally behaving similarly but at some point, one doesn’t respect support or resistance lines.
The aforementioned demonstrates the cash divergence, in cases like this, the divergence involving the Bitcoin and Ethereum prices when pegged against the U.S dollar. The trading platform
You will be needing a dependable platform that gives usage of important indicators and also a trading interface that is tuned to generally meet trader requirements. TrailingCrypto is one such platform and the beauty is that you could switch from exchange to another within its platform. In addition, it offers the flexibility of selecting various kinds of order types. In addition, it uses measures such as API keys to connect to the various crypto exchanges, and two-factor authentication as security measures. As far as the assets are concerned, you can trade Bitcoin pairs and other cryptocurrency pairs, so you have good variety.