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    Cryptocurrency Trading Strategies

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    Ilya Krupin
    CEO, HiCoTrading.com

    The Internet is overwhelmed with countless bullshit articles on cryptocurrency trading strategies written by the people with zero crypto-trading experience. We are going to put it up as an easy wise read for you – so you’ll get more understanding than 90% of the web so-called “pro-traders”.

    Since the first exchanges appeared, trading on cryptocurrency exchanges has always been a risky game. The digital assets markets have always been highly volatile: you can receive lucrative gains – or lose everything in a blink of an eye due to lack of proven cryptocurrency trading strategy and self-overestimation. Fact is, you need a wise approach to get substantial additional money. However, beginners make mistakes and trade incorrectly, which leads to their capital “drain” just during the first days of trading.

    The Best Cryptocurrency Trading Strategy Main Points

    Without going into complex strategies, which are hard to deal with being a rookie, we give you the insight into the main approaches of the market survival. The main advantage of all the strategies described below is high profitability and minimal risks. It is essential to understand the impossibility of trading in cryptocurrency environment without any risk since there is always a chance of a sudden collapse of the virtual money rate.

    The Approaches To Market Trading

    Buy & Hold

    We start with a classic one. Many existing strategies may be applied in the short term game, but this one works out best for the long run. The very essence of this strategy is simple – that makes it so accessible. A confident trader buys merely the selected crypto assets and keeps them in his wallet until they value grow significantly.

    As the cryptomarket reached its heights back at the end of 2017, many crypto assets value rocketed – this trend continued for some time, giving an opportunity for smart players to get substantial gains.

    Example: do you remember the end of 2017 and crypto assets rocketing to the moon on the bullish market? In some weeks, certain currencies went up many times in price. If one could buy 1 ETH for $670 in mid-December, a month later they could be sold twice more expensive! Having acquired 100 ETH and used this strategy, the trader could earn $67.000!

    Do note that to use and win using this strategy, it is necessary to achieve a deep understanding of the currency market. Moreover, you need to maintain a particular price milestone – and after the rate of the currency reaches this value, sell it fast.

    Scalping

    For the first time, it was applied to the Forex exchange and related ones, and both amateurs and professionals gladly used it for their profit during the day trading cryptocurrency strategy.

    Hence, the essence of this cryptocurrency trading strategy is simple: a trader concludes a large number of trades during a short time and then closes them in a few minutes.

    Fact is, the overall strategy is straightforward, but it is not recommended to invest in a scalping significant amount for trading, since the crypto assets may collapse and make a trader broke. It is best to perform scalping on currencies of the second or even third tier since they can grow by a few percents in a few minutes, thereby bringing outstanding profits in the short term.

    An example to use:

    How to use it? This strategy could be used on any exchange you prefer. The tactic is simple. For example, you buy a 10 Litecoins – that would be $330 max at today’s prices. You continue to monitor the rate during the day and the latest trends. When the price grows on 10%, you immediately sell it, having acquired $30 profit! It’s simple and can take even a few minutes or an hour a day.

    Arbitrage

    Well, this trading scheme for cryptocurrency exchanges is even more straightforward.

    How does it work? You buy a cryptocurrency on one exchange at a low price and sell it on another crypto-exchange for the highest bidder.

    It’s a straightforward and profitable cryptocurrency trading strategy on the exchange, which requires only regular monitoring of exchange rates. However, counting on possible earnings, you need to take into account the commission that some exchange charges. If the difference in the exchange rates of one currency on exchanges is 2-3% or more, the selling can be profitable. In case the exchange difference is less than 2%, then the profit will be minimal, or it will not be at all because of the commission.

    In 2018, the manual arbitration is practically dead, but the bots trade is still possible to go with. Fact is – they are faster and smarter than people and are able to analyze a much larger amount of data.

    And another example:

    Let’s say you’ve bought 10 ETH’s for $1250 at some exchange, transferred it to your wallet and have sold it immediately on another exchange for $1350. Simple math again – $100 is your gain.

    The Automated Trading

    What else creates obstacles for a trader besides the market volatility? The growing world uncertainty regarding the exchanges registration and verification, crypto markets regulations and shifts, high commissions and more. The trader needs a convenient tool to minimize the risks and to improve convenience.

    Finally, why should you do everything by yourself? In modern days, technically advanced robot trading can make all the difference. The new way of making the best out of strategy trading cryptocurrency is here to here you.

    The cryptocurrency market is relatively young and the existing technological solutions, undoubtedly, can not offer a full range of convenient, useful and comprehensive tools for successful trading.

    Example:

    Most smart traders use robots with a selection of programming environments and tools for creating trading robots.

    Nowadays, there are a lot of convenient & powerful options available – such as TradeScript (SmartX), CQG Integrated Client, TSLab, LiveTrade (CoFiTe), TradeMatic, Smartcom, StockSharp, Quik, TRANSAQ and so on. Choose and have profit. Meanwhile…

    Future is definitely engaged in the robotic solutions.

    HiCo Trading Features

    The HiCo Trading project team has created a promising, easy-to-use and necessary terminal to work with based on many years of trading experience

    It will no longer be required to use several applications at the same time – the available HiCoTrading functionality will make it possible to trade much more efficiently than before.

    Besides, our platform will be continuously updated and improved, which will undoubtedly provide its demand in the world market for years to come.

    HiCo Trading will offer numerous opportunities and services – our features and advantages are the following: workspace customization options, convenient asset management in one place, statistics tracking, professional trading tools and the news feed inside the platform.

    Moreover, as the platform development progresses, the number of implemented services and features will also be increased.

    Last Tips

    Let’s sum it up – what’s the best trading strategy for cryptocurrency anyway? The one you should define for yourself as it depends on your likes and goals.

    It is worth noting that active crypto trading is not only dangerous, but also very expensive. On average, the exchange commission is 0.1-0.2%.

    The ones that like to feel the adrenaline pumping in, can also proceed with margin trading. That is, you can both earn five times more and lose everything with a slight correction of 20%.

    Truth be told, you can’t just download fancy random cryptocurrency trading strategy pdf from the web and get all the stuff you need to truly understand this chaotic market.

    Meanwhile, like any other system, trading has its own hints and features. In case you are a still a rookie in this game, you’ve probably learned or will learn the basic stuff the hard way. Anyway, keep main ideas in mind: no place for the perfectionism, take your wounds and losses with a cold mindset, plan your actions carefully and – so you will minimize the risks. Have a good profit!

    Summing Up

    Buy & hold is suitable for a long-term game, this strategy, as practice shows and Warren Buffet confirms, is the most profitable, despite the fluctuations in the assets price. 

    Scalping strategy is good for experienced traders. The most difficult and nervous trading strategy so far. Scalpers on timeframes from M1 to M30, the duration of the transaction – from a few seconds to minutes. Profit on transactions is minimal, the number of transactions can vary up to 100 per day and above. Most scalping traders are sitting on the energy drinks and burn out fast. You can try this out with a minimum deposit, which is not a shame to lose, and do not use the trading leverage.