The best Bitcoin day trading strategy is designed to help cryptocurrency day traders profit big from the volatile up and down moves that occur in Bitcoin on a daily basis. One of the main attractions of day trading Bitcoin (BTC) or any other liquid coin is the rapid fluctuation of prices. Sep 26, · So, you need a day trading cryptocurrency strategy to protect your balance. The high volatility nature of Bitcoin and other cryptocurrencies has made the crypto market like a roller-coaster. This is the perfect environment for day trading because during the day you’ll have enough up and down swings to make a decent profit/5(). May 07, · The other day trading cryptocurrency strategy often used is chart analysis. This is where traders study the price movement of a particular cryptocurrency and try to guess which way it will go, based on historical price movements. When analyzing charts, you can look at how a price moves every few seconds, minutes or even hours.
Day trade bitcoin strategyDay Trading Cryptocurrency: Crypto Trading Strategies
One of the main attractions of day trading Bitcoin BTC or any other liquid coin is the rapid fluctuation of prices. MT4 Indicators: alternative-ichimoku. The alternative-ichimoku MT4 indicator was designed as an alternative to the well-known indicator Ichimoku Kinko Hyo. The indicator is used to gauge momentum in line with likely areas of support and resistance on the crypto chart.
The lines represent the jaw blue line , the teeth red line and the lips green line of the Alligator. Day traders can make profits from both short and long trades in Bitcoin. Moreover, this strategy is designed to work with any cryptocurrency of your preference. If the silver histograms of the MACD indicator readjust to appear below the 0. It involves making multiple trades in a market on a single day, quickly reacting to price fluctuations to make lots of small margins of profit which eventually add up.
Traders have to be quick on the draw, and they have to be vigilant, knowing when to enter and exit the market to maximize profits in a short space of time. It is also linked to trading psychology in order to lead with the head, over the heart. Using a Day Trading Setup means having an eye very closely glued to the Bitcoin chart to identify what is happening on the market in real time so that a trade can be made when the strategy suggests. It means trying to identify different patterns on the charts that are showing what is about to happen so that the Day Trader can enter the market and take profit off the perceived next market movement.
These same strategies can easily be transposed to the Bitcoin Market, and in fact can be better used because of the potentially higher volatility and bigger moves. A Day Trading Setup is not even that complicated as it is a pretty straight forward way of thinking that we use everyday anyway. The same logic holds true for day trading. Below are five of the more popular Day Trading Setups that have been effective for traders for a long time, and across different markets. One thing that is always notable, and one thing that causes excitement for traders is breakouts.
In the Bitcoin space this is especially magnified with the level of volatility, and they play in well with the first Setup — Day Trading Breakout. A breakout is defined when a stock gaps up or down on high volume first thing on the open. These types of moves are almost always related to a news event. Day traders move into the market once they see that the price breaks beyond flat range. After this breakout, the trader closes the trade above resistance level.
Once this is established traders can buy when the market breaks above a failed resistance level, and sell when the market breaks below a failed support level. This trading setup is looking to take advantage of a percentage of a market that is non-trending. To get this setup right, a trader should confirm the price range by ensuring it is not breaking out of the resistance or dropping below the floor of the range set out on highs and lows.
This gives you a riding wave to follow once you are sure of the range and a few chances at entering and exiting with profit. The flag shape formation is a result of a stock that made a strong move upward, on high volume forming the pole shape , and then consolidating at the top of the pole, on lighter volume, where the flag is formed. The secret in Trading the Flag is to identify a flag that has a pattern with less than a This is one of the best Day Trading Setup for new traders for a number of reasons.
They are easy to understand, and it does not take long to identify them or to get good at noticing them, and they are generally small chart patterns, which means they tend to carry less risk than other day trading setups and can yield sometimes pretty good results. This is a very profitable Day Trading Setup for the Bitcoin market as it is one that world well with the more volatile markets.
The aim here is to catch the pause in the market before the next break out and it usually comes at the point of a triangle. Triangles occur in the Bitcoin charts when there are at least two swing highs, and two swing lows that have a connection with trendlines that head right.
With the triangle setup, you buy below the most recent swing low and sell above the most recent swing high. This method is quite a risky and potentially highly profitable one as it deals better with volatility which in the end is harder to chart and react to.
This Trading Setup is a good one to use to try and maximize profits from potential breakouts. Fading is a strategy that exploits these blips in price. The fader bets against any move that takes the price out of a normal range. THis is not the same as trading against a trend, but rather it only happens when the trader decides to fade when the movement goes into uncharted territory.
In the world of Bitcoin trading, there is the opportunity for profit, but there is also a big draw for traders because of the rush of trading — especially Day Trading. There is ample opportunity and volatility in the Bitcoin market, and a number of easy to use platforms to get going quickly, but having a little bit of a strategy makes it all that much better.
Getting a good Day Trading Setup is also a good way to start Day Trading Bitcoin as it gives a literal and effective starting point.