Cryptocurrency trading strategy. Table of Contents

Simple strategies for Cryptocurrency trading

You are seeing this page, which means that you have chosen the most advantageous asset class right now! In recent years, far more millionaires have made their fortunes with cryptocurrencies than any other trading tool. Experts believe that the prosperity and growth of the cryptocurrency will continue in the future. However, it should be noted that although cryptocurrencies can indeed make a lot of money, if you do not develop a proper trading strategy and stick to it, then the chance of making a fortune will be very small.

Since many Bitcoin traders have made huge profits, it is easy to overlook one point: their gains are the losses of others. Someone earns half a million U.S. dollars a day with Bitcoin, which means that other people (or several other people) have lost the same amount of money at the same time. Extreme volatility means extreme risks and opportunities. It is absolutely necessary to strike a proper balance between profit and loss. A reliable and effective trading method is the most practical way to achieve profit. You can choose the following two simple trading strategies according to your risk appetite.

Cryptocurrency Trading – Best Strategies, Worst Mistakes and Myths

1. Tether-cost averaging

This simple trading strategy comes from the field of value investing and has been used by stock investors for dozens of years. It is called the “Dollar Cost Averaging Method” (DCA). As the saying goes: Do not repair if it is not damaged. The “cost averaging method” is perfect for prudent novices or conservative currency holders, because this strategy can protect users from the ups and downs of the market, while the average return is also considerable. For example, starting from January 1, 2018, you will buy $150 in Bitcoin once a week, and you will spend a total of $26,700, which is equivalent to 5.07 Bitcoin (as of this writing, it is worth $190,217). If you spend $26,700 to buy bitcoins on January 1, 2018, you will only get $64,080 worth of bitcoins (1.6 bitcoins) in the end. As you can see, the power of the DCA strategy is incredible, especially for long-term trading. This strategy requires patience and investment of time and energy, but compound interest returns and excellent buying opportunities will definitely make you feel that everything is worth it.

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2. RSI divergence

If you are ambitious and want to try intraday trading, this strategy will be a good entry-level choice. As you may know, the Relative Strength Index (RSI) can tell us when assets are overbought or oversold. Can help us judge whether the price is going up or down. The “RSI divergence” strategy observes the difference between the price and the RSI indicator, and can identify in advance when the direction of the change will occur before the price trend actually occurs. Normally, the price and RSI index changes almost simultaneously. But when the RSI rises, the price occasionally falls, and vice versa. And this marks a subtle change in the volume of buying and selling, and a strong signal for an early trend reversal. The 4-hour or daily chart is the best place to look for divergence, because it shows strong changes in the mid-to-long-term trend. In the StormGain platform, you can directly overlay the RSI indicator on the in-app instrument chart, making it easier for you to analyze. When you find a buying opportunity, you can trade directly without switching pages.

What is Relative Strength Index (RSI) indicator? How to use it?

How to trade through “divergences”?

Continue practicing for a bigger moment

You must have some practical experience before deciding to start trading Bitcoin, Ethereum or any other trading tools seriously. Using a demo account is an excellent practice method. All the conditions are exactly the same as those of a real account. The only difference is that the demo account uses virtual funds instead of real money. StormGain platform provides users with 50,000 USD USDT demo accounts. You can use this simulated balance to make various attempts to find the most suitable trading strategy for you. In addition to practicing in ordinary ways, the demo account is also equipped with stop loss/profit instructions and leverage tools for trading practice. In other words, when you start trading with a real account, you can avoid the “high tuition” often encountered by market novices. If you can’t wait to start, StormGain also provides a “cloud miner” service, which allows you to increase your Bitcoin balance while building a “major alliance” of transactions. Just start “mining” and wait for the rewards to roll in!

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