Crypto trading is becoming the most profitable way to make money from cryptocurrency today. If you want to earn continuous profit from cryptocurrency, some things are important. The best thing for you is to develop a strategy for upgrading and also this article will introduce you to some of the most popular crypto trading strategies. Do you guys know anything about the first cryptocurrency trading strategy?
What Is A Cryptocurrency Trading Strategy:
You can never rely on timing and chance while trading cryptocurrency because you should have a good strategy to open positions and earn profit. Also, we must pay special attention to the strategy while trading in cryptocurrency. Otherwise, we may suffer many losses.
- Rules for selecting an asset to trade
- Rules for analyzing the market
- Rules for opening and closing a position
- Rules of risk management.
Best Crypto Trading Strategies:
Many factors influence which strategy is best in cryptocurrency. Besides, who is responsible for whether your strategy is good for you, whatever strategy you make, make it thoughtfully and test it well first and see. You should guys first know how beneficial these strategies can be for you. First, learn these things and then practice them. But we will now tell you about some of the best crypto trading strategies.
Range Trading:
A simple technique employed when prices go sideways is range trading. Prices have comparable highs and lows over this period, forming a resistance and a support level. Reduced volatility reduces possible profit but may also reduce risk since these highs and lows are predictable.
It is crucial to establish that a range has been verified before beginning to trade inside it. In other words, the price must attain a minimum of two identical highs and lows without rising or falling during any interval in between. Buying near support and selling near resistance is the easiest approach to implement after validating the range. Profiting from market swings in both directions, seasoned traders may sell close to resistance and buy back close to support. A stop loss is placed beyond the range bounds while trading in ranges.
MACD:
The MACD (Moving Average Convergence Divergence) is one of the most often-used trading indicators. However, developing a money-making strategy based just on the MACD is challenging. That’s why traders, besides the MACD, often utilize other metrics like RSI, Parabolic SAR, and Stochastic.
- MACD line crosses the signal line upwards.
- A bullish candle is set up on the chart and is crossed by EMA10.
- Parabolic SAR breaks and starts active under the price.
You should search for the opposite indications to open a short position.When the trend is shifting, as indicated by the Parabolic SAR or MACD, it is wise to exit your position.
- It is wise to set a stop loss since these indications are not always accurate.
- Shorter periods are not as effective for the MACD as longer ones are.
Moving Averages Crossovers:
This is a well-known and traditional method of exchanging cryptocurrencies. This technique focuses on identifying potential trends. Its foundation uses two moving averages (MA), one shorter and one longer in time.
MAs with durations of 50 and 200 days are typically used by traders who like swing trading. MAs with periods of 9 and 20 candles work well for day trading.
The RSI indicator is used to help traders avoid mistakes a lot. A buy signal is present when the RSI is over 50; the shorter MA crosses above, the longer one. Similarly, it is a sell signal when the RSI is below 50, and the shorter MA crosses below, the longer one. You typically close a trade when you get a signal that goes against the MA crossover. Alternatively, you may utilize a trailing stop loss.