At this point, you’ve likely heard of Bitcoin, a mobile currency, also known as cryptocurrency. Did you know that you can become a Bitcoin trader? Since conception in 2009, Bitcoin continues to rise in popularity, to the point where almost 300,000 daily traders occur worldwide, pushing the Bitcoin market over $100 billion in early 2020.
The great thing about Bitcoin for new traders is the entry-level is relatively low compared to other investments. Because of that and several other features, Bitcoin trading continues to rise in popularity and is worth your attention in investing.
Ready to begin Bitcoin trading? We have a beginner’s guide to getting you started.
Understand Bitcoin and What Moves Its Price
Before beginning any trading style, Bitcoin included, you need to understand what it is and what affects its price. There are several factors that influence the price of Bitcoin, including its finite supply amount, any bad press and key events that occur.
Decide Your Trading Style
Bitcoin is a type of currency that you trade, which means you have various trading style options to choose from. You could become a day trader in Bitcoin, or go on a buy and hold plan instead. Whichever you choose, make sure you have your style clearly defined.
Investing in a Trading Platform
You’ll need a platform to trade Bitcoin on, and not every platform is the same or offers features for Bitcoin trading. Because you’ll be trading on the forex market (foreign exchange market), you’ll want to ensure you use a regulated broker (the platform BDSwiss is regulated and an excellent starting point).
The problem with some platforms is that they do not comply with trading regulations (an example being Hugosway broker). Some of them have ties to offshore companies, which is a red flag for you. If something happened and the company was audited or got slapped with regulation issues, you could lose your money.
Open Your Trade
Once you have your platform and account set up, you’ll need to open a trade to get started. The goal is to start a trade at a low price, watch it grow, and then sell it at a higher price, making a profit. As you open trades, you’ll need to monitor them to find the perfect spot to sell before the price starts to dip.
Close Your Trade
Once the price moves into a position that you’re comfortable in, you can start to think about selling. Ideally, you’ve followed the price trend and done your research to sell at a profitable point. Unfortunately, we can’t always accurately predict the market, which means you’ll have trades you close for a loss.
One way to prevent having too significant of a loss is to have a stopping point clearly defined. Your stop point is when you close your trade before it drops too low, causing you to lose money.
Before starting your trades in Bitcoin, it’s always essential to research. The more you can prepare yourself, the better chance you have of making an educated, informed and…
Read more:A beginners guide to bitcoin trading