Cryptocurrency prices are unpredictable and volatile, which makes day trading in the space a difficult task. Whether you know a lot about cryptocurrency or very little, there’s no predictable pattern to make money with crypto - at least not in the long run.

Market Characteristics

The crypto market has very distinct characteristics that make it lucrative and simultaneously risky. The market’s small size and youth lead to large price swings from day to day, making it very volatile. You can’t use the same strategies today that you did yesteryear to make money.

One important thing to note is that Adara has a stop loss option. You can enter the market where you feel comfortable and exit automatically when prices get too low for comfort. This prevents extreme losses but doesn’t mitigate loss completely.

The upside is that with crypto, you can also make a tremendous amount of money. Volatility and potential profits are inextricably linked, after all.

When to Trade

There are plenty of factors to consider when day trading. You want to make the most out of your crypto trading platform and use strategies that deliver results right now. No one knows for sure what will happen from day to day, even with knowledge based on the best cryptocurrency charts - so every edge helps.

One key thing to look for is liquidity. If the crypto pair you’re looking at isn’t very liquid, you won’t be able to make a timely exit at a fair price. In a market with limited buyers, you probably won’t have anyone snapping at the bit to take that crypto off your hands.

You can limit your trading to high-volume days where you won’t incur much slippage. When the market is active, there are more buyers and therefore liquidity than on low-volume days. In a volatile market, a rapid exit is essential to making money.

You may also consider limiting your trading to weekdays and skipping weekends and holidays to maximize your volume. You don’t have to trade every day to do “day trading.” You’ll incur much less loss if you stick to these high-volume days.

Don’t listen to what other people say. Popular sentiment isn’t always right. Sensationalist articles and clickbait are everywhere, and headlines are made to sound dramatic and appealing. Pay attention to what you see in the market, not what you hear on the news.

For a beginner trader, it’s best to stick to technical analysis that makes it easy to make correct decisions based on data alone. To that end, you may find it prudent to learn about TA using Adara Academy.

A Beginner’s Day Trading Toolkit

To begin day trading cryptocurrency, you need a few tools in your toolbox. There are always new things to learn, but you will also benefit from an understanding of the history of your chosen digital currency and market trends.

Research your crypto trading platform fee structures. The fees add up when you’re trading on a daily basis. High fees are not your friend.

Understand the patterns of the market and how to make predictions based on history. A good understanding of how to use a technical analysis will serve you well in day trading on a volatile market.

Take courses, read articles, and seek out opportunities to master the terminology of day trading so when you see acronyms on your crypto trading platform, you know what it means.

The best practices come with experience, so the more you do it, the more you’ll understand. Start with small amounts of money you’re not afraid to lose and set up stop loss options so you don’t sink on your maiden voyage.

The more you do all of this, the more you can develop your own strategies and find what works for you. Make sure your trading is data-driven and responsible. Some days you win, and some days you lose. Don’t give up.