PAID CRYPTO CURRENCY 💲TRADING COURSE
Day Trading Guide
Day trading is a special type of short term trading done by active traders who execute intraday strategies to profit off of price changes for a given asset, like cryptocurrencies. Day trading can be a very lucrative venture as long as you do it properly, but it can also be very challenging for novices, especially for those who don’t have a well-planned strategy. The main feature of day trading is that the traders buy the asset and sell it off the same day for profit, or some times for loss.
To be successful in day trading, you must be well grounded in technical analysis and also possess a high degree of self-discipline and objectivity.
Below are some of the strategies used by day traders:
Scalping: With this strategy, they attempt to make numerous small profits on small prices changes throughout the day.
Range trading: With this strategy, they discover favorable support and resistance levels to determine buy and sell decisions.
News-based trading: News generally affect the prices of assets. So with this strategy, day traders typically seize trading opportunities from the heightened volatility around news events.
High-frequency trading (HFT): This strategy involves the use sophisticated algorithms to exploit small or short-term market inefficiencies.
Day Trading Advice
Do not day-trade large-cap coins: The prices coins with of large market capitalization like BTC, ETH, etc. are the less volatile. They need huge capital investment to move the price up. They yield best in long term investment.
Day-trade low-cap coins with high growth potentials: Coins with low market capitalization are the most volatile. Their prices can easily go very high and also come down very low within a short period of time. Note that not all low-cap coins will yield high ROI in day trading. Look for low-cap coins with very high growth potential, especially on short term basis.
Trade with the amount you can afford to lose: Always remember that day-trading is riskier than long term trading. So in order to make sure you don’t get wrecked financially, trade with the amount you can afford to lose because crypto market is generally volatile and can go south any moment. If you are not willing to take the risk involved in day trading, then consider investing for long term in cryptocurrencies.
Always Start with Small Capital: Focus on a few coins rather than going into the market head-first and wearing yourself thin. Going all out will only complicate your trading strategy and can mean big losses.
Be ready to devote your Time to the Trade: Day trading is a business that requires a lot of time. If you want to perfect your strategies, after you’ve practiced, you’ll have to devote a lot of time to it. This isn’t something you can do part-time or whenever you get the urge. You have to be fully invested in it because the prices of crypto coins are generally volatile. If you don’t have much time to devote to day-trading, then focus on long term trading.
Know and apply the necessary Strategies: There are several different strategies day traders use including swing trading, arbitrage, and trading news. These strategies are refined until they produce consistent profits and effectively limit losses. The risk and reward levels of these strategies vary. Swing trading strategy is the riskiest and also has the highest reward level.
In summary, the main differences between day trading and long term trading is that day traders take more risk and use capitals they can afford to lose. But this capital must be tangible if you must make a fortune from day trading. Long term traders are investors who are willing to hold the asset for a very long time, no matter the level of fluctuation in the market. They only sell when they have made huge profit, most times, not less than 100%. While day traders are willing to sell their bags off the same for profit or loss, say plus or minus 5% or 10%.
