Top 3 Popular Trading Strategies for Newbies
Hardly any successful trader can work without technical analysis. Which is no surprise, since it is a reliable tool for trading virtual currency.
There are a huge number of indicators that people use to create their own strategies. We know it all seems a bit complicated at first but you'll soon get the hang of it.
Despite this, there are also effective strategies that have won young future players' love. The reason that they're so popular these days is because they're mechanically simple. It is precisely on this subject that we wish to share our views. Let's get started!
Why Do We Need Indicators?
Technical analysis indicators reflect the market's situation and avoid getting lost in the jungle of trading. They identify market structure, find entry and exit points and can help you receive signals for cryptocurrencies.
With their help, traders create their own strategies. They are usually combined so that the user can build a complete picture of what is happening in the market. This approach contributes to the quick and qualitative analysis of the information.
Crypto lovers can add, remove, and configure the indicators focusing on personal needs and preferences. But for those who have just started their journey in trading, the standard settings will be enough.
The Best Strategies for Novice Traders
Note: it's very effective, but it's not that simple.
The main idea: you need to open a large number of positions during the day and quickly fix the profit.
Risks: the volatility is high. The price of cryptocurrency can change rapidly over a short period of time. With this, there are great risks, especially for beginners.
The main idea: Moving Average Convergence/Divergence turns two trend-following indicators, moving averages, into a momentum oscillator by subtracting the longer moving average from the shorter one. As a result, the MACD offers the best of both worlds: trend following and momentum.
2 basic indicators with standard settings are quite enough:
- MA (included in the MACD);
There are 2 types:
- cross-exchange arbitrage;
- triangular crypto arbitrage.
The primary modus operandi of the first one is:
- buy assets at a cheap price on the exchange A;
- send magic internet money to the exchange B.
- sell at a better price. What could be easier?
P.S. don't forget about the commission for withdrawing crypto and for the exchange.
Risks: the price can change dramatically if the volatility is high. As a result, you will lose profits, and possibly incur losses. This is especially true when it comes to BTC and ETH. Their blockchains are characterized by low speed and high cost of operations. This can lead to a significant change in the exchange rate.
The classic scheme of the triangular crypto arbitrage involves three trades, all of which are usually carried out on the same platform.
P. s. The price of different crypto pairs can also vary greatly.
We are aware that this is a drop in the ocean. The list can go on and on: there are strategies based on Bollinger Bands, Fibonacci levels, Parabolic SAR, etc. We will continue to offer our readers digests about trading strategies.
Do you want to learn more about the world of crypto and income-generating directions? Then follow Equite on social media: Twitter, Facebook, or Telegram. Remember: if you want your trading to get better, you've got to be better.