How to Day Trade Crypto Day Trading Strategies for 2023

Pretty much every cryptocurrency can be traded in short and long positions if you know how to ‘read’ the market. However, some coins seem to be created as a long-term investment whereas other cryptocurrencies perfectly work for day trading. In addition to presenting profit opportunities, volatility can also cause significant losses.

Kraken CEO Jesse Powell founded the company out of a desire to build a secure, organized, and trusted crypto platform following the major security breach at Mt. Gox. You should then sell when the first candle moved below the contracting range of the previous several candles, and you could place a stop at the most recent minor swing high. Finder.com is an independent comparison platform and information service that aims to provide you with information to help you make better decisions. We may receive payment from our affiliates for featured placement of their products or services.

What is the cheapest platform for day trading crypto?

If the market starts to revert to the mean and your position moves into profit, you can add more size if you’re comfortable and your risk tolerance allows. If orders are getting filled as usual and the order flow remains steady, you can start to add small size, set your stop loss and wait for a rejection to occur before pulling the trigger. However, if there is an influx of new volume and expansion candles, this could be a breakout developing – be cautious and don’t rush into trades you hadn’t planned for. Are you able to handle all this weight on your shoulders while potentially losing money?

• But like any trading endeavor, it requires that you treat it like a business and manage your risk properly.
• On the upside, traders seeking substantial profits within one day are attracted to this volatile market because of the potential for rapid gains.
• You should also define a stop-loss level to limit potential losses by exiting a trade at that price.
• It takes the emotion out of trading and instead it trades using strong artificial intelligence to perform fact-based technical analysis.
• A cryptocurrency exchange will allow you to buy and sell coins 24 hours per day.

Any action taken by the reader based on this information is strictly at their own risk. BingX’s inclusive approach to new traders is complemented by its compliance with regulatory authorities in Australia, the United States, and Canada. Deposits can be made directly from the platform using a credit or debit card, with a minimum deposit for crypto purchases set at $50. For instance, if you open and close a trade within 30 mins, you won’t pay a trading fee. If you want to avoid losing your profits to computer crashes and unexpected market events then you will still need to monitor your bot to an extent. Trade execution speeds should also be enhanced as no manual inputting will be needed.

Unpredictable Markets

To become a professional in any field, the most important thing is – practice. Trade a small amount of your funds and don’t put all your money into trading. However, you will need to follow the US regulators’ Pattern Day Trading Rules. By journaling your trades in a spreadsheet you can analyse them to find out what is working and what is not working. You can open a free account with eToro and see and test all of these services and features for yourself.

• And if you decide that day trading isn’t for you, check out our overview of all the main ways you can make money with crypto.
• Binance Academy offers learning resources for those who want to learn about trading cryptocurrencies.
• More than 200 cryptocurrencies and seven different fiat currencies can be traded, with a commitment to add new coins in the future.
• Day traders employ intraday crypto trading strategies to take advantage of the luxuries of the crypto-verse, and they will likely close their positions before the day ends.

Binance lists well over 350 cryptocurrencies, which means that you should be able to trade practically any relevant cryptocurrency when the right opportunity arises in the market. In terms of derivatives, Binance provides stablecoin-settled and crypto-settled futures, as well as options. Traders on Binance Futures can access large amounts of leverage, up to 125x in some cases. A wise trader does not depend on information from other traders to know when to enter or exit the market. Learn how to conduct technical analysis and keenly follow news headlines that are likely to affect the market.

Understanding key technical indicators

However, current news can still tell you what cryptocurrency or crypto pairs will be trending and, therefore, will have active price movement in the near future. Additionally, you can use the news to predict whether you should open short or long positions. Many fortunes have been made in cryptocurrency, but it is important to always keep in mind that many, many more have been lost. The flip side of unprecedented price surges of several hundred percent is sudden drops.

The difference in the buy and sell price of an asset is known as the “spread.” As a generally unregulated market, crypto allows anyone to create an exchange. This can lead to major differences in the spread because the differences in asset liquidity and trading volume. In layman’s terms, a cryptocurrency exchange is a place where you meet and exchange cryptocurrencies with another person.

Day Trading Cryptocurrency: What You Need to Know First

However, fuss around a particular cryptocurrency may lead to greater volatility, so keep an eye and act promptly. Instant crypto exchange Changelly provides access to over 150 cryptocurrencies. Read our guide and start using this trading style in your trading strategy if you want to learn how to day trade Crypto.

Sure, people who get in early (meaning really really early) and hold on to their positions on Bitcoin made a lot of money. But day traders, who buy and sell in rapid succession throughout the day, could be better suited during market downturns and high volatility. This day trading strategy involves studying financial data such as historical prices and data points to locate statistical trends in the crypto markets. This gives traders a chance to identify opportunities for trading and earning profits. EToro has integrated essential functions such as one-click trading, TipRanks research, and a professional-grade technical analysis tool. Bybit stands out as a platform for experienced day traders seeking opportunities beyond basic buy/sell orders.

Strategy

EndoTech is a leading automated crypto trading platform that has been fine-tuning its trading algorithms since it launched in 2012. This may seem a bit scary for some but EndoTech never gets permission from your exchange account to withdraw or transfer funds so you don’t have to worry. There are many options to choose from, but the first thing to keep in mind is that not all exchanges will allow you to day trade cryptocurrencies. In fact, some only allow users to place buy or sell orders for a certain amount of time before they expire. It might be best for your first experience with cryptocurrency trading to stick with an exchange that allows limit orders as well as market orders (and even stop losses). If you’re getting into the crypto world and are looking to make some good money, day trading could be a great avenue.

You will find a wide variety of digital currencies on the Coinbase website that can be purchased with ease. You will pay 3.99% to buy a crypto asset direct with your debit card – which is expensive. Bank immediate edge stock transfers are significantly cheaper – often costing less than a dollar. Coinbase is the largest cryptocurrency broker in terms of client accounts – with more than 35 million people now using the site.

Pionex – Best Crypto Day Trading Platform For Bitcoin Novice Investors

As such, there are hundreds of online platforms, exchanges, and brokers that offer cryptocurrency trading markets. Moving forward, we’re going to teach you what you need to learn how to day trade cryptocurrency and we’re going to share some out-of-the-box rule-based day trading strategies. Trade with discipline, use risk management tools such as stop-loss orders and establish clear entry and exit points. Candlestick patterns can be used successfully for cryptocurrency day trading when learning, adapting, and managing risks prudently. In addition, use one of the best day trading apps to implement candlestick patterns properly.

• This may seem a bit scary for some but EndoTech never gets permission from your exchange account to withdraw or transfer funds so you don’t have to worry.
• In the past, flash crashes have led to exchanges refunding millions of dollars in losses to affected users.
• Trading is a skill developed over thousands of hours of practice and countless mistakes.
• Copy trading is perfect for beginners or those who want to trade crypto but don’t have the time or knowledge to do it themselves.
• On the flip side, robots can be riskier than Copy Trading or signals, as you are allowing the software file to access your capital.

Make sure your stop loss is well placed and your position is sized according to recent volatility. In this section, we’ll explore the various types of trend pullback trades and provide you with risk management and profit taking strategies to help capitalize on them. Pullback trades are common in crypto futures markets as there’s often a trading pair experiencing – a trend day and increased volatility. The pullback trade is a trend trading strategy that aims to pinpoint over or underpriced entries. These trades are best executed by recognising when the market has retraced to fair value and is likely to resume its trending state. It can also be a good idea to scale out of positions and incrementally take size off.

Trade On Margin

They can be hard to master, and getting caught offside in a fast-moving market can be costly. When first learning to trade breakouts, use small size and focus on correct position management and stop loss placement. As shown on the chart below, stop losses for breakout trade setups are best placed inside the trading range or before the support or resistance level.

• This gives traders a chance to identify opportunities for trading and earning profits.
• Currently, membership costs $297 per month, or $1,297 per month, with the Textbook Trading, Swing Trading, and Tandem Trading course included.
• This form of trading implies that trading positions open and close within the same day.

Of course, prices still go up or down, but compared to cryptocurrencies, it would generally only be by a small amount. Let’s take a quick look at an example of two cryptocurrency day trades. Range traders assume the confines of those price ranges will maintain support and resistance until the price action breaks outside – those confines. As such, the bottom confine of a price range will possibly shove the price action upwards, and the top confine will press the price action downwards. However, the price action could potentially break out of a range depending on the number of times it touches a support or resistance level.

Conclusion – Crypto Day Trading

Even the most successful traders in the world make losses, as it is impossible to always make the correct prediction. If you want to trade other cryptocurrencies, it’s a good idea to use an exchange that offers in-house markets for multiple coins (like Coinbase). That way you can easily buy and sell the coins of your choice without having to jump through hoops or sign up for another cryptocurrency exchange.

• EToro supports debit/credit cards, e-wallets (including Paypal), and bank transfers.
• Cryptocurrency day trading is different from the one provided by a traditional stock market.
• Binance offers very competitive spot trading fees — the base fee for both makers and takers is set at 0.1%.
• There is no minimum deposit at Robinhood which again – is ideal for small investments.
• As you can trade cryptos 24/7, the market session times used are usually in line with when the European market opens (7 am GMT) and when the US market opens (2.30 pm GMT).

Successful crypto day traders need to have higher chances of winning than losing. AvaTrade is one of the best platforms for crypto day trading as it has an extensive range of markets. At the time of writing, it was within the top 60 cryptocurrencies by market capitalization on CMC, which ensures at least a baseline level of liquidity. A big crypto asset like this is also more likely to be listed on various crypto day trading platforms, which allows traders to use advanced trading strategies like arbitrage. Recent market and industry developments are less of a factor in crypto day trading strategies than in long-term investment. That’s because day traders make a profit off price fluctuations, not necessarily bullish or bearish trends.