One of the leaders in terms of the number of queries in search engines on the topic of cryptocurrencies is the phrase “cryptocurrency trading strategies.” More and more people are showing interest in the world of cryptocurrencies and want to make a profit in this market. Traders get the highest profit from intraday trades. On sharp price fluctuations and panic in the market, you can make good money every day. It should be borne in mind that there is a relatively small number of users and even fewer traders on crypto exchange platforms.
Features of trading in crypto instruments
Many traders overlook the fact that the most famous cryptocurrency, bitcoin, is not regulated by the state in any way.
This leads to the fact that trading bitcoins through a broker has a number of features:There is no transparency. When a bank is going to buy or exchange currency, it sends an appropriate request, which is registered with the regulator, and puts its offer up for auction or forms a purchase order at the current rate.
As for bitcoin, its owner creates a sell order on the exchange platform at any convenient price and waits for other participants to respond to this offer. There are no preliminary approvals and registrations. There is no quote provider. Most often, brokers study quotes on several stock exchanges and display the average value for the terminal.
At the same time, a force majeure situation may arise on any site, for example, the owner of an asset suddenly decides to get rid of it quickly, or, conversely, in an effort to hide his fiat money, someone decides to urgently purchase bitcoins on it. Such situations can lead to sharp fluctuations in the exchange rate.
The cryptocurrency is not backed by anything. The value of fiat money is guaranteed by the authority and economy of the issuing state. And the value of bitcoin is formed only on the basis of the current needs of traders. There is no calendar with important events. Many traders make money from the so-called market noise preceding important news and sharp movements at the moments of the exit. There is no such calendar on the cryptocurrency market, and its creation is not yet possible due to the lack of centralized management. When the PRC announced the introduction of a ban on ICOs and exchange platforms, the rate fell by 13% within an hour. When a cryptocurrency exchange reports that it has been hacked or stopped working, the rates always drop sharply due to panic. And despite the fact that the above points are disadvantages, traders still do not leave the cryptocurrency market. On the contrary, crypto trading is growing and developing. The restrictions set by brokers on the number of instruments offered (only Bitcoin, sometimes the Ethereum cryptocurrency and one or two other assets) are only beneficial to traders, since focusing on a small number of instruments allows for better analysis and making informed decisions.
Profit trading of crypt exchangers
These sites offer their clients a wide range of trading instruments, as they earn commissions on each trade. On the one hand, these sites are good for the trader, because he gets the asset in his ownership. On the other hand, if, in a panic, a trader wants to quickly get rid of a falling asset or buy a growing one, then due to the small number of its participants, the required level of liquidity may not be available on the floor. Therefore, it is rarely possible to get high profits from intraday trading on exchange sites.
Efficiency of technical analysis
According to research results, the majority of cryptocurrency traders prefer classical analysis over fundamental. The reason lies in the decentralization of the cryptocurrency market, the disunity of its traders, the absence of a single provider of liquidity and a calendar with key events.