How to trade Bitcoin? The most comprehensive guide

Trading Bitcoin involves many steps and as a smart trader you should know how to go about it the right way in finding the best Bitcoin trading app. You can choose from different trading methods depending on what you wish to gain from the investment and the time you can devote to trading.

Trading can be of 4 types as follows:

Day trading: Here, the day traders will open and close positions in a single day; it is best for traders keen to enjoy advantages of short-term market opportunities.

Swing trading: In this type, traders will catch price movement trends and hold onto such trends till they last; this strategy pays off when you want to get the best out of market momentum.

Scalping: This involves making many small intra-day trades on small price changes. This works best for those interested in making small profits regularly instead of waiting for one big profit-making chance.

Passive trading: When you wish to try your hand at crypto trading or prefer to hold onto your assets for long, passive trading works best. So, you wait for prices to fall to a certain level, and then you buy in; once prices rise up to a specific point, you buy out.

For trading Bitcoins you must understand both fundamental analysis and technical analysis. The former will view the bigger picture rather than price movements. So, you will monitor developer activity centering on a coin, number of projects being developed, mainstream adoption of the coin etc. Technical analysis is the method or tool for predicting future price movements; this is done regardless of whatever is happening around you. Price movements will give you an idea of what will happen in the future. You can even get the basic guidelines of bitcoin trading from this link and make your trading process much easier.

  • When you have decided to trade Bitcoins, you need to create an account on a crypto exchange. It requires only a few minutes and you can soon start to add funds.
  • You will then need a trade plan or strategy. This will help you to take impartial decisions when stakes are very high. The strategy you choose will ensure you do not close your trades too fast or leave them open too long. To make this plan you must decide what your goals are and break these into short-term and long-term ones. You must figure how much risk you are ready to accept and how much profits you ideally need to justify a loss. You must then choose which crypto assets to invest in or simply start with the Bitcoin.
  • You have to undertake research to keep yourself informed about the latest news. You must look at trade charts because past data will tell you how markets are moving and what the emerging trends are.
  • Then you can go ahead and place a trade. So, you enter an amount you wish to stake and define the close conditions. You have to set a stop in order to close the trade in case the market moves adversely. When you are expecting the Bitcoin to go up in value, you can “buy”; if you feel the prices will fall, you “sell”.