What you need to know about cryptocurrency trading for beginners

What is crypto trading? 

Trading cryptocurrency is the act of speculating on cryptocurrency price movements through contract for difference accounts (CFD) or buying and selling underlying coins on an exchange using a contract for difference trading account. Essentially, a CFD is a derivative that allows you to bet on Bitcoin (BTC) price changes without owning the underlying currency in order to make a profit. 

 One must have a comprehensive understanding of the assets and technologies involved before even considering crypto trading. Bitcoin is the soil from which thousands of other cryptocurrencies have grown. 

 Cryptocurrency trading can be complex, involving a variety of components and requiring knowledge, as with stocks and other financial markets. As the first crypto asset, Bitcoin was launched in 2009, and it has remained the largest cryptocurrency in terms of market value and popularity ever since. 

 Over the years, however, an entire industry of other digital assets has come into existence with the assets being tradable for profit. All other cryptocurrencies that are not BTC are known as altcoins, the largest of which is Ether (ETH).

 You will gain an understanding of crypto trading strategies and platforms, the components of a trade, the styles of trading, and the role of technical and fundamental analysis in creating a comprehensive trading strategy.

 What you need to know about cryptocurrency trading for beginners

 There are several ways in which to trade cryptocurrencies. To begin trading cryptocurrencies, one must first acquire adequate knowledge about the subject before they can begin trading. In addition to knowing the associated risks and the laws that apply in one’s jurisdiction, it is important to make appropriate decisions based on this knowledge.

 Become a member of a cryptocurrency exchange

 Unless you already own cryptocurrency, you’ll need to open an account with a crypto exchange. Three of the best crypto brokerages on the market are BTCC, eToro and Gemini. Each of these services offers a straightforward user interface and a wide selection of altcoins to choose from.

Similar to a stock brokerage, you’ll need to provide personal identifying information to open an account with a crypto brokerage. Among other Know Your Customer (KYC) requirements, you’ll need to provide your address, date of birth, Social Security number (in the United States) and email address when creating an account.

 Fund your account

 Upon signing up with a cryptocurrency brokerage, you will need to connect your bank account. The majority of cryptocurrency exchanges accept bank deposits through debit cards and wire transfers. Using wire transfers is the most cost-effective method of funding your account. And they are available on Coinbase and Gemini as well.

 Pick a crypto to invest in

 There are many cryptocurrency traders who put the majority of their money into Bitcoin and Ether, but technical indicators can also be used to trade these cryptocurrencies since the movement of these cryptocurrencies is more predictable than the movement of smaller altcoins.

 It is a well-known fact that many cryptocurrency investors invest some of their money into altcoins. Although smaller and mid-sized cryptos have a lower market cap, they offer a greater upside potential than large-market cap cryptos. 

 Start trading

 It may be a good idea to try using an automated trading system such as Coinrule if you’re looking for a crypto trading strategy. Crypto trading bots implement a process that is designed to provide you with the most significant returns possible. Based on your investment objectives. 

 With crypto automated trading, you can make money quickly, you can keep your coins, or you can diversify your portfolio by investing in cryptocurrencies in a conservative, neutral, or aggressive way. You can even trade currencies actively on some sites while automating trading on others depending on your personal preferences.

 Store your cryptocurrency

 If you plan to trade Bitcoin actively in the future, it is recommended that you keep your funds on the exchange in order to have access to them. For example, if you intend to buy cryptocurrency to hold for a medium to long period of time, you should purchase a Bitcoin wallet.

 The two types of cryptocurrency wallets are software wallets and hardware wallets. Both are safe, but hardware wallets provide the maximum level of protection. Because they store your cryptocurrency on a physical device with no internet connection.