Crypto Trading for Beginners - 5 Effective Strategies
In crypto trading must not do without technical analysis. Today, users have access to a large number of indicatorswith which you can develop your own fucking strategies. Of course, many of them are quite complex and incomprehensible for newbies. Inexperienced traders are advised to pay attention to certain Strategywhich have a high popularity among users. They are distinguished not only by efficiencybut availability, ease of use.
Let's consider the main strategies for effective cryptocurrency trading. These tools are easy for every novice user to understand.
The subtleties of using indicators and Crypto Trading
Technical indicators show current market indicators. In addition, they help determine:
- support and resistance levels;
- direction of the trend of interest;
- the degree of oversold and overbought.
Using indicators, a crypto trader is able to find the most successful points entry to the market, as well as receive timely signals on sale or buying cryptocurrency. Unique strategies are created by traders based on indicators... The available terminals of cryptocurrency exchanges contain preconfigured basic indicators. A trader can use them in his trading. The list of such indicators includes MACDand SMA и Volume.
Paying attention to the indicator MA, which smooths out price fluctuations and calculates averages meaning prices, you can quickly understand in which direction the trend is moving.
Indicator Volume displays current market activity - prevalence sellers or Buyer.
The trader has the opportunity to independently remove, addand also customize the most useful indicators taking into account personal preferences. At the same time, it will be enough for beginners standard settings. They are the ones that the creators recommend to their users.
Moreover, experienced traders often use them for work as well. After a certain time, novice crypto traders learn to set up indicators for yourself. The next block will consider the most popular trading strategies, and also describe the rules for working with them in practice.
Scalping and Crypto Trading
Scalping it is difficult to name the most simple strategy for beginners. However, if you study it well features, this tool will provide good findings... Its meaning is that a trader gets the opportunity to make several transactions in one day... Due to this, you can get not very big profits, but, bitch, very swiftly.
It is important to remember that cryptocurrency belongs to highly volatile assets. Accordingly, their price in one day can change by 10% -50% -99.99%. This feature carries elevated risks for traders - beginners in this case need to show accuracy.
A trader needs to define at least two parameters:
direction of the trend;
support and resistance levels.
Levels Support и resistance allow you to understand at what moment it is most advisable to open, or vice versa, close position. If the price moves away from lower borders, you can make purchase... A rebound from the upper boundary indicates good conditions for sale.
It is recommended to pay special attention to sliding average. Indicator Volume helps to form an additional picture of the market. If the indicator shows red price, and on the chart it green, this indicates that the price is preparing for a breakout and sellers' positions are getting worse.
What indicators should be used in Crypto Trading
For successful trading, a trader needs to determine resistance levels, Supportand trend directions... To get accurate data, you need to use trend indicatorsas well as indicators momentum и volume... This list includes:
It's important to keep track of the direction trending indicators, because the trend can change in any moment. By the way, it is impossible to guess this in advance 🛑
It's important‼ ️ Binance, as well as other large sites use service charts Tradingview... To add an indicator to the chart, just click on it and enter the indicator name in a special field. In the list that appears on the screen, you need to select the appropriate indicator.
It is no less popular strategy, which has proven itself among novice traders. In this case, it is necessary to determine in which direction the price is moving at the moment. Trend may be global or local. For long-term и mid-term trade any global trend.
How to spot an uptrend
With an ascending trend the price moves by a ladder to narrow channel. Moreover, she is able to go beyond it. slightly... Basically, every local minimum above previous... For local highs the same applies rule.
How to trade correctly
When it became clear that the trend was heading up, you need to highlight the main levels resistance и Support... It is from them that it is necessary push off... Thus, the support zone is suitable for opening long positions. As for the zone resistance, it is intended for them closing.
If the trend is downward, the signal to the beginning of resistance will be breakdown resistance level. It is important to remember what happens in some cases. false breakdown, you dirty bastard. If, after a breakout, the price quickly rolled back and returned to its former position, this may indicate that there has been false breakdown. In this case, it is better not hurry, and wait for more clear the trend.
Application of indicators
This strategy implies trading on the trend... Accordingly, the trader is recommended to use the following indicators: MACD, MA (SMA, EMA)and Stochastic RSI
Breakdown of the resistance level
This strategy is used if the trend is still not formed, however, a breakout of the main level may already indicate its shift... For a long time, the price can bounce off the level resistance и Support.
As you know, the price cannot move in only one direction... With a significant increase in the rate, the positions of buyers weaken and the process begins to include sellers.
How to determine a likely change in trend?
With a likely change in the trend, the price amplitude gradually decreases... In other words, the price is in flat * or in lateral movement - lateral *. In an uptrend, any resistance level can be indicated. Sellers are like “pushing»The price is closer to the resistance level.
The trend is likely to change if the resistance level remains unchanged, and the support level is approaching it, as it were locking schedule. At some point it happens breakdown resistance level. At the same time, the cost starts gradually grow, demonstrating the formation of a new trend. In this case, it is important that the price does not roll back to previous level - this position is called false phenomenon *.
How to Trade
It is NOT necessary to rush and open positions after the price breaks above the resistance level ❌. It is important that at the same time the following condition is met: the support level should be located Not less previous resistance level - theory Charles Doe... At the same time, you can safely open long and trade with the trend.
What types of indicators are better to use
In this case, it is recommended to use trendy indicators. At the same time, they can be supplemented with indicators of volumes and momentum. The list of suitable indicators can include: RSI, Volume, as well as MA (SMA, EMA) and Parabolic SAR.
Crypto Trading - MACD Strategy
MACD (divergence и convergence moving averages) is the most simple и popular indicator, from used in trading.
How to trade
In the event that the lines of the slow and fast MA intersect below zero MACD level, the trader can carry out purchase cryptocurrencies. In this case, you need the fast moving line to cross the slow MA from below up... It is this trend that testifies to growth prices
Sell signal - intersection slow MA from above down... In this case, it is not at all necessary that the intersection be carried out above zero MACD level.
Crypto Trading - Which Indicators Are Better To Use
As mentioned above, for this strategy, it is quite enough two indicators with standard settings: MACD, MA (included in MACD).
Crypto Arbitrage and Crypto Trading
Not every trading strategy is based on indicators... However, they may imply their use in the role subsidiary tool. At high volatility on the crypto market, there is often a difference between quotation on various exchanges, as well as in trading couples... The difference between the quotation is capable of reaching 5% and more.
Let's highlight 2 types of cryptocurrency arbitrage:
Inter-exchange arbitration works as follows:
a trader buys cryptocurrency on the first site at a lower cost;
the next stage is the transfer of coins to the second crypto exchange;
selling coins at a higher value.
In this case, it is important to calculate commission when withdrawing cryptocurrency from the exchange. At the same time, there are still risks that the current rate will change sharply and the trader will not only lose profit, but also suffer losses. This is especially true for the cryptocurrencies Ethereum, Bitcoin. Their blockchains are distinguished by slow and expensive transactions (they can take up to 1 hour or more). During this period, the course may much to change.
Intra-exchange arbitrage implies the use of a trading intermediate pair within the same site. The course in different pairs can vary greatly.
Striking examples of intra-exchange arbitrage:
purchase of 1INCH for ETH;
selling 1INCH for USDT;
exchange USDT for ETH.
You can see that it turns out a kind triangle... In this case, the profit is derived from the price spread... Moreover, the higher liquidity, the below there will be a spread. Accordingly, the spread can be significantly higher. This feature opens up great opportunities for crypto arbitrage.
With a small Liquidity orders are executed longer - this is the peculiarity primary risk intra-exchange arbitration.
Crypto Trading - Conclusion
This is just small part of the trading strategies that beginners actively use in practice in order to raise loot... Inexperienced traders are also advised to pay attention to other trading strategies based on Bollinger Band, levels Parabolic SAR, Fibonacci and other indicators.