It is impossible to start felicitous trading from scratch. Having decided to invest 30-40% of free funds in such an area, people should, prepare reference books and a knowledge base. The technical details are also important. Every beginner needs to get the hardware and install the right apps. It is also worth equipping the workplace and drawing up a trading schedule.
Entering CFDs (contracts for differences) is the most popular way to trade cryptocurrencies since such tools provide greater flexibility. A technique involves the use of a high lever and the ability to make deals in both short and long positions. The Lightning Profit team decided to dig deeper and clarify all features of trade and pitfalls that can wait for the beginner. Let’s start.
Growing Popularity of Cryptocurrency in 2010-2020
Cryptocurrency has become increasingly popular in the last 5-7 years. Since the official launch of Bitcoins, the principles of online trading have changed significantly. The same goes for BTC rates. But the prospects for quick profits remained just as promising. That’s why thousands of enthusiasts are investing millions of dollars in this ecosystem — financiers, developers, owners of global companies, and other people.
Cryptocurrency trading is common for experienced, psychologically stable financiers who are ready to show great patience and are already familiar with the stock market. For beginners, the journey will not be so easy but that doesn’t mean it’s hopeless. All of them can use mobile applications, video tours, and other materials to make their task easier. This is the best way to get experience. Here are 4 reasons why people choose cryptocurrency:
| No intermediaries | Any bank charges a fee as an intermediary. This parameter should always be deducted from the profit. With BTC, traders never overpay. People with mobile phones can use cryptocurrency to make payments without creating a bank account and paying fees. |
| Less devaluation | Central banks can do money emissions in case of economic crises which can devalue the currency and cause inflation. Most cryptocurrencies have limited emissions. So, the influence on the rates by the states is excluded. |
| Safety | When people put their traditional money under the control of banks, some governments can write off money. This is not the case for BTC when your money is protected by a cryptocurrency key. |
Now, there are 3 types of earnings on cryptocurrency — mining, investment and trading. For each case, you will have to create an e-wallet. When choosing a platform for funds, newcomers should consider volatility, liquidity, fees for margin lending, and commission costs.
Trading Principles
Cryptocurrencies are digital coins that are based on cryptography and high-level security. It’s about BTC, ETH, USDT, and others. Most rates for this currency do not depend on the central bank which regulates economic processes. At the same time, such coins are considered legal tender. To become a successful trader people need the following skills:
- Understand the market
- Manage all risks
- Create wallets and stick to weekly limits
- Check BTC charts
Risk & Cryptocurrency
Cryptocurrency prices can change significantly in 2-3 days. For example, after Tesla bought a large amount of Bitcoin, such an event caused fluctuations in the market. In addition, the price of Dogecoin has grown due to Elon Musk’s tweets. This means that the money invested can quickly depreciate and assets disappear like snow in the sun.
The Lightning Profit team believes that a proper strategy is a series of actions and reactions to fluctuations in the cryptocurrency market. No one can guarantee you 100% that you will always have an income. But if new traders think through every step, they won’t fail from the first deal. When using Lightning Profit App, people should understand that this is the most volatile market. Price fluctuations of 20-30% in just a few days are real.
Stay up to Date With the Latest News
Try to follow all political and economic news. Any insiders about war or global crisis have a big impact on the BTC market. For example, when Iran attacked the US military bases in Iraq, the Bitcoin price ratio rose from $8,000 to $8,300. This situation led to the revival of the entire market. So, newcomers cannot become successful traders if they do not follow the news.
How to Choose the Right Platform?
Now, there are many platforms for cryptocurrency trading. The most popular are Coinbase, Binance, Bitcoinmeester, and LiteBit. These 4 websites make trading accessible and even simple by providing an application with intuitive controls.
One of the most important rules of any trader is to use only trusted exchanges that ensure fast transactions, high security, and easy withdrawals. Make sure your personal information will not be used for any other purpose. Beginners should monitor the daily volume, read the documentation (Terms of Use and Conditions), and find information about the headquarters.
Top 4 Strategies
These days, cryptocurrencies can be exchanged through platforms like Coinbase and used as traditional money to buy things — clothes, digital products, assets, and more. Many collectors and marketers have long adopted this payment tool. Such enthusiasts can get richer if they have profitable deals every month. At their disposal, there are the 4 main principles:
| Buy & hold | People buy an asset and hold it for a long time. They try to predict prices for months and keep charts for specific periods. Such a strategy is based on fundamental analysis. |
| Swing trading | Such a strategy for quick decision-making. You just track trends, and at the right time draw up a deal. |
| Day Trading | This refers to trading on the stock exchange within one trading session during the day. |
| Scalping | This is a “high-speed” and “high-frequency” exchange. The trader opens and closes positions in the period from 1 to 15 minutes. In short, a small profit from each trade brings a big income. |
Wrapping Up
As the market of decentralized finances develops, the number of new projects that can be invested in is constantly increasing. These are many prospects for every beginner. Start trading in small amounts and remember: if you plan a long-term and profitable activity, you must have a lot of patience and time.
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