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Adopting a trading strategy works and is constant even in Cryptocurrency. This article talks about the Top 7 Crypto Trading Strategies. 

With the plethora of cryptocurrency Altcoins available in the market, one thing is for sure, Bitcoin gives you value for money. As of now, there are at least 1200 cryptocurrencies in the market. 

Crypto Trading StrategiesAs the choices are overwhelming, it is quite challenging to pick one. Ideally, day trading gives traders opportunities to invest their time and effort to understand the market they plan to trade-in. 

It is the same for cryptocurrencies also as the new entrant gives a lot of opportunities to traders to profit from the discrepancies and movements. These don’t ideally exist in other markets. 

Now the question is, what is day trading? When we talk about day trading, you can say it is a process where you can speculate on financial products. 

Often, day traders speculate over short term price movements by buying and selling some financial instruments. 

About Cryptocurrency

For several years now, traders tend to focus on some markets to make a profit. Thanks to the increase in liquidity and opportunity, cryptocurrency markets are quite popular nowadays. 

Basically, cryptocurrency is nothing but a digital asset under which there are some consensus algorithms. The digital ledger stores all the transactions.

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    Best Crypto Trading Strategies

    Here is the list of Top Crypto Trading Strategies used by traders & are hugely successful strategies –

    • Scalping
    • Reverse Trading
    • Momentum Trading
    • Buy the Dips & Hold
    • Follow the Trend
    • Fade Trading
    • Range Trading

    Here are the list of Top Crypto Trading Straggles. Lets have a detailed understanding of these strategies now.

    Scalping – Best Cryptocurrency Trading Strategies

    If you execute it properly, you can say scalping is one of the best trading strategies that you can adopt in your lifetime. You can say that the strategy focuses on making small trades with a minimum time period. 

    Here the only thing you need to follow is the time duration where you need to keep it small, at max less than an hour. 

    Scalper’s biggest asset here is the volume because the number of trades is way more important than profit in any transaction.

    Ideally, the scalpers don’t wait for significant gains as they can’t wait for the markets to turn to minimize losses. 

    In simple terms, the traders just have to take advantage of small market movements by quickly entering and exiting the market. 

    The main agenda here is to make maximum possible trades and also reduce the losses. All you need to maintain a higher win or loss ratio instead of earning high returns per trade.

    Ideally, the winning and losing size is the same. If you want to be in profit often, you also need to win often. Under a few strategies, you lose most of the trades but end up winning other trades. 

    This strategy is way different than the other strategies. Usually, when traders use this strategy, they choose to avoid volatility because it is unpredictable for them. 

    One of the best situations for the trader is a thin market that is calm and has no or little volume. 

    Additionally, the thin market is also spread among bids and asks, and the traders make the profit on the gaps available. They buy on one side and sell on the other. 

    The best part about this strategy is that it is safe as such because it has only limited time frames. If anything ever goes wrong, one can exit the trade. 

    The pitfall with this trade is that you need to have some patience and discipline to trade under this strategy.

    Additionally, traders also need to compete with trade bots if they want to use scalp opportunities.

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    Reverse Trading – Best Crypto Trading Strategy

    You can say this is one of the most advanced trading strategies, which is based on the general reversal trend in the market. 

    All you need to do is find the exact moment so you can understand the trend in detail. When you have an eye for detail, you can easily make out about the trend reversal. 

    The trader will wait for the trend to be reversed if the coin is in the bullish market for some time then. Besides this, the traders also predict the high or lows of the day to make money on prediction. 

    The only risk here is that traders end up making the wrong prediction of the reversal timing.

    Momentum Trading – Best Cryptocurrency Trading Strategies

    If you are looking for one of the most straightforward strategies, then momentum trading is your best bet. 

    Under this strategy, all you need to do is understand the momentum of the market and the riding of the wave. Besides being a simple strategy, it is also one of the riskiest strategies you will ever come across. 

    Volume is the main component of this strategy, and they also define the volume which a trend aims to generate. 

    Buy the Dips and Hold – Top Crypto Trading Strategies

    If you are a new trader, then you might feel that the strategy is counter intuitive. But in reality, it is not true because the price of the asset is a fantastic opportunity to buy. 

    You might feel that when the market is down, it is best to remain away from the market, but instead, it is a great time to enter the market. 

    Overall the cryptocurrency market is strong, just like the stock market, and after some falls in the price due to the news, it also regains the price. 

    Additionally, you can say the cryptocurrency market is a volatile market that can quickly change the market directions. 

    When you look back, you can see a strong upward trend with regards to the price of Bitcoins. But at times, even Bitcoins were undervalued. 

    As the majority of the buyers don’t have much market experience, say that the cryptocurrency market is quite sensitive to media. 

    People rush and buy cryptocurrencies when the news is positive and vice versa. Traders can use their expertise and learn when the market is overvalued or undervalued. 

    The best part about this strategy is that you don’t need any software.

    But the pitfall here is that this strategy is quite long term, so you can’t make quick profits here as timing is everything, so you need to have a great understanding of the conditions of the market to make the most out of it.

    Know the Real Differences between various Cryptocurrencies:

    Compare Bitcoin Vs Ripple  Compare Bitcoin Vs Litecoin 
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    Follow the Trend – Best Crypto Trading Strategy

    This strategy is ideally a risk-averse strategy because you don’t know whether the market will be in this trend for a while or not. Under this strategy, traders tend to trade with the trend instead of the swings. 

    You only open long trades if the market is trending. On the flip side, you open short trades when the market is falling. 

    After the trend is established, the traders then follow the trend, and when the trend changes, traders tend to exit the trade. You can also call it position trading.

    Additionally, to maximize profits, traders can use a plethora of tools, including margin trading. The drawback of this strategy is that the crypto markets are not predictable. 

    And traders also need effective mechanisms to protect themselves against sudden price changes.

    Fade Trading – Top 7 Crypto Trading Strategy

    If you want to bet against the trend prevailing in the market, you can surely choose fade trading.

    Additionally, it is also a risky strategy because you have to bear huge losses if there are any wrong predictions prevailing. 

    On the flip side, you can make huge profits if you make the right move. You can implement this strategy when the market volatility is high.

    It ideally happens when some countries plan to ban cryptocurrencies. 

    Range Trading – Top Crypto Trading Strategies

    The strategy mainly depends upon two concepts that are support and resistance, which are used both in stocks and forex trading. Firstly, you need to master the strategy of the candlesticks chart. 

    All you need to do is buy the currency at the support levels and sell the same at resistance levels.

    The main agenda here is to see if the price remains in the range. It breaks the limit when it goes beyond a particular level. 

    Crypto Trading Strategies – Conclusion

    Irrespective of the strategy you choose to invest in, you must be okay with taking losses as the cryptocurrency market is quite volatile. 

    Above all, you need to know that the market also gives you endless opportunities. Additionally, please note that it is way more than just an emotional journey when it comes to trading. 

    You must be consistent with the strategy you choose. We advise you not to follow the market trends; instead, invest in coins you believe in. 

    You can try all other strategies left out after you gain some market experience. If you are a new trader, you must not invest in too many coins. 

    Experienced traders always come on top during times of panic. Well, if you keep your urges in control, you can surely make a profit. 

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