Bitcoin trading done with the right strategies can help you earn incredible profits. A bitcoin strategy is a method to trade bitcoins that cover the price position at which traders enter and exit the market. There are some ultimate trading strategies that can help you achieve your goals. While there are so many strategies, the trader can choose the suitable one according to their risk appetite, goals, and available funds. We will discuss the bitcoin trading strategies and learn few tips through which you can make your trading journey a victorious one. You can also choose Bitcoin Bank Breaker that helps you to trade professionally.
Bitcoin Trading Strategies
HODLing
One of the most popular bitcoin trading strategies that most traders follow is of HODLing. HODLing here means “holding on for dear life,” In this strategy, the traders or investors buy and hold bitcoin for a long term. HODLing term was first recognized in 2013 when bitcoin’s price fall for the first time and an investor used hodling instead of using word holding. He used hodling to indicate that he will continue in his position and will not exit the market. Since then, it is used as a strategy in the crypto market, and traders who want to hold bitcoin for the long term often use the term “HODLing.”
Traders hold bitcoin with the expectation that its price will increase in the long term. Because bitcoin’s market is highly volatile, this strategy might also result in losses. You must be highly careful while using this strategy and have a risk management plan to execute it.
Hedging
Hedging is a bitcoin trading strategy where the traders open strategic trade to eradicate or diminish the risks that are related to existing positions. Suppose you would hedge an already existing position by opening a position to short bitcoin. In that case, this includes selling your crypto asset at the current market price while expecting that its price will decrease. Additionally, if the price seriously falls, traders then buy it again at a lower price and can generate profit from the difference. There are many risks involved in hedging, and therefore, you must use your risk management plan accurately and take all necessary measures.
Breakout trading
In breakout trading strategy, the traders must enter the bitcoin market as soon as possible in the trend and get ready for the price of crypto asset to break out compared to its previous range. The bitcoin breakout strategy is based on the idea where the market breaks through resistance level or key support, and after that, volatility will begin. At key points, bitcoin traders would try to enter the market to travel the trend from starting to end.
Trend trading
Trend trading is another popular bitcoin trading strategy where the trend reaches consistently lower lows or higher highs. Trend trading is only suitable at distinct timeframes when traders hold the position open for them as long the trend continues, and it can be either for days, weeks, months or years. For many people, bitcoin is itself a trend. Bitcoin experienced a surge for the first time in 2017, and after 2017, it again raised in 2020. People are going with the trend and hype, and no one wants to miss taking advantage of the volatile bitcoin market.
Bitcoin Trading Tips
Understand the market
The bitcoin market is infamous for being extremely volatile, but volatility helps traders earn profit. Before entering the market, learn about the factors that influence bitcoin’s price: news, events, and limited supply.
Learn how to trade
You need to first decide on the trading method and strategy that you want to choose. It is important to study all the methods and learn which is beneficial according to you. Understand the steps that are involved in starting with bitcoin trading.
Have a risk management plan
Volatility is an important part of the nature of the bitcoin market. It is imperative to have a risk management plan that will help you set the parameters of limits and stops of your trades. This will prevent you from losing your money and also from becoming greedy if the price keeps increasing.
