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Cryptocurrency trading strategies for beginners

02/04/2019
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No one can tell what is the best way to trade on a cryptocurrency exchange. There are many different strategies to get a steady income. However, beginners should start with the simplest options. Although their profitability may be lower, the degree of risk will also decrease.

Channels and their importance in the analysis

Among all the many instruments of technical analysis, it is support and resistance levels that are most popular. First, they are very easy to build. Because of this, a large number of traders build trading strategies on a cryptoexchange on them. As a result, such signals receive additional support.

And no less important is the aspect of universality. A channel built on a 15-minute chart retains the effect on other timeframes. To properly build a channel, you need to determine the state of the market. When flat, it will be strictly horizontal, with a trend a certain angle of inclination will appear. In the first case, you need to find on the chart:

  • previous levels of price consolidation;
  • digits ending in 0 or two zeros;
  • Fibonacci trend correction.

If we are talking about the active phase of trade, that is, the trend, then three points will tell you how to trade cryptocurrency. One of them should be carried out through two local maximum (or minimum). And the second one is drawn through the opposite side of the graph, that is, the maximum (or minimum). Usually beginners quickly cope with the task of building a channel, it does not cause problems.

How to trade cryptocurrency within the range

After completion of the preparatory phase, you can start trading. If the price has already formed a corridor of movement, there is a high probability of saving it in the near future. And far enough to remember the rule - buy at the lows, sell at the highs.

Actually, that's all. The investor opens a buy order at the lower border, fixes the profit at the top. And then he opens an order to sell. When the price reaches the minimum, the procedure is repeated.

However, there is another aspect, without which even such a simple strategy can be ineffective. This is capital protection. You should not make it too complicated, just start using stop loss. Its size is determined as 50% of the planned take profit. This ratio allows you to trade on the stock exchange with the maximum yield.

To make the strategy even more profitable, it is worth remembering another important trading rule - not to open a position against the trend. Of course, if the work is carried out over a large time interval, with a high profit potential, then it can be neglected. However, if trade goes to H1 and less, it is not profitable to make sales in the global downtrend. This also applies to purchases with growth.

Additional features of a simple trading strategy

If the trader already knows how to properly trade ripple, bitcoin and ethereum, then he has already become acquainted with indicators of technical analysis. They can be entered into the described strategy as an additional signal.

That is, when the price approaches the upper boundary, it is worth checking whether the indicator is talking about the continuation of the trend. If there is such a signal, it will be more logical to take profits. But do not open orders for sale.

However, instead of indicators, you can use other methods of analysis - Japanese candles or graphic figures. As the professionalism of a trader grows, his arsenal of techniques also increases. Therefore, the profitability of the strategies of experienced professionals is much higher. But do not rush. The cryptocurrency market gives a chance to those who know how to wait and gradually prepare their success.

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