It is important to think about what kind of cryptocurrencies you are looking to get involved with. Another important aspect to day trading cryptocurrency is that you set yourself a stop loss. A stop-loss is when you enter a price that you want to automatically exit your trade. In fact, the amounts must not be any larger than you can afford to lose.

• The arrival of online trading, along with instantaneous dissemination of news, have leveled the playing—or should we say trading—field.
• This includes a CryptoPortfolio – which is a diversified basket of digital currencies at various weights.
• This allows you to trade with industry-leading spreads alongside a small commission.
• First and foremost, when day trading, it’s essential to have a structured approach and a rule-based strategy.
• 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.

Professional day traders—those who trade for a living rather than as a hobby—are typically well established in the field. Here are some of the prerequisites required to be a successful day trader. But there are day traders who make a successful living despite—or perhaps because of—the risks. Like anything worth doing, becoming successful at day trading in crypto is not easy.

Multiple News Sources

With these precautions, you too can become a successful crypto day trader. There is a robust platform where you can share information and learn from other traders, meaning that you can get to know other day traders and even bounce ideas off them. There’s a learning section for those who want to read up on the subject, and pricing is clearly noted on the site. You can open an account for free, start trading and enter the crypto market right away. There are several cryptocurrency exchanges and brokerages to choose from, and some may be a better fit for you than others. If you’re a day trader, you’ll want to use an exchange with low or zero trading fees.

• We use this indicator to track the activity of smart money and to gauge when the institutions are buying and selling cryptocurrencies.
• Most day traders work from home for starters and don’t have tough bosses telling them what to do at all times.
• If you’re not day trading Bitcoin, which is the most liquid coin out there, and you like the altcoins, try to pick those coins that have good liquidity and volatility.
• Trade execution speeds should also be enhanced as no manual inputting will be needed.

These are just a few of the reasons why day trading crypto currency has become so popular. The next section will explore the first steps to take in getting started with day trading, including choosing the right crypto currency to trade and setting up a trading account. Crucially, crypto day trading is a short-term strategy that will see you hold onto a position for a few hours. On the other hand, if you were to hold onto a cryptocurrency position for days or weeks – this would be a swing trading strategy. First and foremost, when day trading, it’s essential to have a structured approach and a rule-based strategy.

Managing Risks Effectively

In this context, day traders never leave positions open overnight since they aim to capitalize on intraday price movements. Traders should set time aside to familiarize themselves with the upcoming rules and regulations taxing profits earned from crypto. For day traders, the sale of any crypto held for less than a year is taxed as marginal income. Make sure to include your crypto gains when reporting earnings online or with your accounting professional. Range trading capitalizes on sideways markets (or non-trending markets) by pinpointing stable high and low prices, represented on charts as resistance and support levels.

If the exchange that you want to use does not accept real-world money deposits, then you can first go to Binance to buy some Bitcoin or Ethereum and then transfer it across. So now that you know how it works, the next part of my “Day Trading Cryptocurrency” guide is going to look at what you need to know before getting started. One of the standout features of OKX is its provision for engaging with DeFi projects via liquidity mining. Starting with educational resources, OKX provides an extensive range of learning materials that spans from beginner to professional levels.

Bot trading

A crypto day trader using this strategy is betting on the change of a crypto asset’s price. The day trader earns regardless if the price rises or falls in the long straddle. Once you’re set up on a platform, it’s time to pick what you’re interested in investing in. The same market condition that scares – away buy-and-hold investors is the chaos that makes opportunities for day traders to make profit. Volatility and liquidity are two elements the day trader needs to actively participate in the crypto market. With that being said, BTC/USD isn’t the only pair that is popular with crypto day traders.

• Depending on your strategy, you can take profits at a fixed target or let the market run, remembering to scale out and take profits incrementally.
• Each market behaves in different ways, like its own unique personalities.
• Trades will come around less often, but a slightly higher timeframe is a good starting point for feeling out the pullback trade and will allow you more time to plan your entries.
• Exchange service commissions range from 0.095% to 0.25%, which is quite competitive in the market.
• Both Binance and Binance.US were sued by the United States’ top market regulators in June.

As a day trader, there is an opportunity to make a very good living, provided you have a well thought out strategy. The idea of working your own hours, being your own boss and getting filthy rich in the ever-booming cryptocurrency market is very attractive… To view what crypto assets eToro supports – click on the ‘Trade Markets’ button, followed by ‘Crypto’.

How to Day Trade Crypto

To maximize your earnings, extensively research the market and asset you’re trading very well and enroll in a day trading course that offers mentorship and a strong community. There are plenty of trading strategies out there and crypto currency trading platforms several platforms that some of the most popular day trading strategies are range trading, scalping, and arbitrage. If you want to save time, you can instantly copy professional traders plays with eToro, and learn as you go.

• As eToro is the world’s largest social trading platform you can talk to and learn from other crypto traders and build a good network and community to support you when trading.
• 74% of retail investor accounts lose money when trading CFDs with this provider.
• This amount of money will give you enough room to buy and sell without incurring too much in fees and ensure good money management strategies.
• Website personnel and the author of this article may have holdings in the above-mentioned cryptocurrencies.
• There are many online materials that can teach you basic trading skills so you become a better trader moving forward.

These courses include Bear Bull Traders, Bullish Bears, Fast Lane Traders, Humbled Trader, and Investors Underground. Other courses are available apart from the ones on our list; however, these were chosen based on resources, community, and expert instruction. The right crypto day trading course for you will depend on your needs. If you prefer a course with a strong community or mentorship, then Investors Underground or Humbled Trader will be a good choice. Investors are encouraged to master the psychology of trading by developing proven strategies from the best all-around traders. A community program is available so that traders can stay connected with others on the same journey as well as receive one-on-one mentorship.

Start Trading Crypto!

Volume is likely relatively low as traders wait for trend confirmation before entering with size. You will likely be trading higher than usual leverage, and it’s a good idea to get in and out as soon as practicable. Placing a stop loss for a fade trade is difficult, as there is no clear position like a range high or a key support level. If the market does reach the other side of the range, you can close the position or let it run into a potential breakout, depending on your strategy.

• Unlike the rules regarding pattern day trading and day trading stocks, cryptocurrencies are not limited by the same regulations.
• Mean reversion positions are some of the most difficult to manage and master.
• Luckily, this doesn’t happen often because of the kind of options the pool uses are all very short-term and far-out-of-the-money.
• Range traders assume the confines of those price ranges will maintain support and resistance until the price action breaks outside those confines.
• Keep in mind that crypto markets are inherently volatile, so a ‘low volatility’ range can still be upwards of 10%.

Secondly, they are the perfect place to correct mistakes and develop your craft. You’ll usually be trading with simulated money, so mistakes won’t cost you your hard earned capital. Once you’ve trialled your strategy and ironed out any creases, then start executing trades with real money. Coinbase is widely regarded as one of the most trusted exchanges, but trading cryptocurrency on Bittrex is also a sensible choice. Always check reviews to make sure the cryptocurrency exchange is secure.

Access to a Trading Desk

StormGain’s mobile app gives you all the functionalities you need to exchange, store, and trade cryptocurrencies at your fingertips. The app, available for iOS, Android, and Huawei devices, includes trading signals, push notifications, charts, and technical analysis tools. StormGain’s trading platform offers a customizable, user-friendly dashboard that displays fluctuating assets. Its all-in-one apps for iOS and Android are recommended for access, but it also supports all major internet browsers. The platform offers advanced trading tools, including position and risk-management software, an institutional level of liquidity, and a 200x multiplier.

When trading crypto pairs with low trading volume, you might encounter sharper price swings but can also get stuck with digital assets you don’t need, being unable to sell them. Day trading is a set of techniques used – to take advantage of short-term changes in the prices of a commodity. As the name implies, the goal of a day trader is to end any given trading day with their holdings having a higher value than they started with.

Step #5: Place Stop Loss below low of the day. Take Profit within first hour.

Trading fees can be reduced even further based on the user’s trading volume and OKB token holdings. Overall, Bitfinex has one of the most impressive offerings in the crypto industry for traders who require advanced features and customizability. However, less demanding traders likely won’t get as much value out of the exchange’s unique features.

• Trading strategies and risk tolerance should be considered when selecting stop-loss levels, which are often placed below technical support levels.
• Which cryptocurrency platform you opt to do your trading on is one of the most important decisions you’ll make.
• This split offers a safety net for users, allowing them to engage in trading while still having the majority of their assets secured.
• For our tutorial – we have opted for regulated broker eToro – which allows you to buy, sell, and trade digital currencies on a 0% commission basis.
• Although this is often seen as a downside, it is a benefit in day trading, as, without it, there is scarcely any way to make reliable profits.
• Highly advanced traders on Bitfinex can also benefit from Bitfinex Honey, a solution that allows traders to create and execute algorithmic orders.

The beginner-friendly Kraken App allows users to buy, sell, and convert crypto easily, while Kraken Pro provides a professional trading experience with advanced features. Users can deposit fiat or buy crypto directly with fiat using various methods, including credit/debit cards and bank transfers. Whilst there are many options like BTC Robot that offer free 60 day trials, you will usually be charged a monthly subscription fee that will eat into your profit. They can also be expensive to set up if you have to pay someone to programme your bot.

Best Crypto Exchanges for Day Trading 2023 – Which Broker is Best?

For instance, there was a time when Bitcoin was selling at a price 40% higher in Korea than in the United States. Day traders simply made significant profits by purchasing BTC in the United States and selling in Korea. To get started, you need to open an account in a suitable bitcoin trading exchange that meets your day trading needs. Notably, the crypto market is incredibly fragmented, and exchanges operate under multiple jurisdictions scattered worldwide. Having that in mind, you need to select a crypto exchange platform that is supported in your country. In any case, let’s assume that to day trade cryptocurrencies, you need to start with a minimum of $500.

There is great sensitivity to breaking news, regulatory changes, technological developments, and macroeconomic developments regarding cryptocurrencies. Investors and traders can make better decisions, reduce risks, and seize opportunities by staying up-to-date with this information. This is relevant when checking the best crypto presales on the market. To succeed as a trader you need to have strict rules that you adhere to with a strong focus on risk management.