Let’s talk about the market and trading strategies

Let’s talk about the market and trading strategies

 

The cryptocurrency market has shed a good deal of its value over the past year. From its peak of nearly $3 trillion, it has tumbled down 65% to about $1 trillion. The market is mostly moving sideways now, and it’s not yet clear if the bottom has been reached or if more pain lies ahead.

 

As a result, many crypto investors are waiting on the sidelines for a clear sign of a bottom or the beginning of the next bull cycle. But that doesn’t mean there are no profits to be made in this changing market. Here’s how you can find opportunities even in these challenging conditions and use them to your advantage.

Crypto is dynamic; use it to your advantage

Even though lower crypto prices offer a great entry opportunity for long-term hodlers, the most profitable traders are those who can find and take the opportunities the market offers them – in bear, bull or sideways markets. Volatility is always there.

Daily price swings of +10% are nothing unusual, as anyone following crypto or stock markets has undoubtedly found out. These short-term trends or daily volatility open up profitable opportunities, which can be traded short or long, by using various trading strategies.

 

  • Swing trading 

Short-term trends in crypto are great for swing traders. They can last from a few days to a few weeks and move the price significantly. In the sideways market, the upward or downward trends are usually followed by a trend reversal, which opens up the opportunity to trade both ways.

 

  • Scalping

When scalping, a trader makes use of smaller intraday price movements, making many trades within one session. For scalpers, large spikes in crypto asset prices are like large waves for surfers – the bigger they are, the longer they can ride them. These price moves also allow them to perform different trading strategies within one session.

 

  • Long and short at the same time

Experienced traders often benefit from short-term price reversals and volatility by playing both hands. For example, if a trader is long in a position and is holding it for a longer period of time, they can take advantage, and short interim price drops to book additional profits on the same trading pair. Going long and short on the same trading pair (or a different pair) can also be used as hedging. Positioning in both directions can be used as a risk management strategy to reduce or hedge the exposure, lower the risk of potential loss of position or investment, or as a trading strategy to recover the losses from the losing trade.

 

  • Averaging Down / Up

Averaging is another effective technique, either used intentionally by trading against the trend or used as a recovery strategy after the market moves against your initial trade. With either, the trader strategically increases the exposure by opening additional positions in the same direction. For example, opening additional long positions in a declining price trend. Lowering the average entry price of all open positions, can result in a profitable trade after a larger pullback or a trend reversal.

 

 

Regardless of the utilised trading strategy, trading with leverage is high-risk, high-reward. To help traders mitigate the risk, we provide all the necessary tools for technical analysis, and risk management with lower leverage limits, and the protective stop-loss and take-profit orders.

Old but gold: diversify

Crypto markets aren’t the only dynamic markets these days. In the last couple of years, we’ve seen extreme price swings in traditional markets as well. Even major currencies like GBP or JPY were trading like penny stocks (dare we say, shitcoins?) lately.

 

Shorter-term volatility in FX, commodity and stock markets often provides more opportunities to trade than bitcoin and crypto, with often clearer direction and more predictable price swings. That means that new possibilities are always opening up, especially with so many different markets and dynamics available.

 

Traders on our platform have a chance to trade many dynamic markets:

  • Bitcoin and altcoin perpetual futures
  • Forex with up to 1000x leverage
  • Precious metals and energy commodities
  • World’s leading indices
  • Stock market CFDs

 

All the above markets can be traded with some of the highest leverage in the industry. Up to 100x on crypto trading and stocks, up to 1000x on FX, and 500x for commodities and indices.

 

Reliability, flexibility, and choice 

With no clear trend reversal in sight, the best bet that traders can make right now is to keep as many options open as possible and act on them fast. This requires using a reliable broker that combines a wide array of trading assets and tools to benefit from the market conditions, whatever those may be.

 

To start trading today, all you need is an email address

Feel free to contact us at support@evolve.markets or through Twitter @EvolveMarkets for any questions or further details.