WHAT IS CRYPTO TRADING?
When it comes to trading, the term "complex" may come to mind. However, with the introduction of crypto trading, this complexity has been simplified. In crypto trading, one does not need to have extensive knowledge in economics to be able to trade profitably. It is a form of investing and, as with any investment, it requires a certain amount of learning and research to make accurate predictions and gain substantial profit. Unlike traditional forms of trading where an investor actually buys an asset, the basics of crypto trading involve predicting the movement of prices for various assets such as currency pairs, precious metals and stocks. It is simpler process when compared to Forex for instance.
WHAT ASSETS CAN BE TRADED AT CRYPTO TRADING?
In addition to the assets commonly traded in the traditional market such as currency pairs, commodities, and indices, the following list of crypto assets can also be traded in crypto trading: Bitcoin (BTC), Ethereum (ETH), Tron (TRX), Solana (SOL), Tether (USDT). This list is not exhaustive and there are many other crypto assets that can be traded. Some other examples include Litecoin (LTC), Ripple (XRP), and Cardano (ADA) and many more. As the crypto market is constantly evolving, new assets are being added frequently, and it is important to keep an eye on the latest developments.
HOW CRYPTO TRADING WORK?
One of the reasons Crypto Trading have become so popular is the simplicity of the process: there are just two types of predictions that are required: a trader should decide if the price of the chosen asset will increase or decrease. He then chooses how much he wants to invest and the expiration time of the deal. A trader profit from the return rate, which is stated before the option starts - that makes the outcome perfectly clear. For example, a trader thinks that in two hours the price of EURUSD pair will be higher than at the moment and chooses to invest $10 with 80% return rate. If after two hours the price goes up, - he receives $18 to the account. If it goes down the loss is only the initial investment which is $10.
HOW TO TRADE SUCCESSFULLY?
Traders employ various strategies in order to predict the future market value of assets and make a profit. One strategy is to base predictions on news events. This is a common strategy among beginners. More experienced traders take a broader range of factors into account and use technical indicators to predict trends. However, even professionals may experience losses due to emotional factors such as fear, uncertainty, impatience or the desire to earn more. Adhering to basic risk management principles can help to control emotions and reduce losses.
WHAT ARE ASSETS?
Assets in trading refer to any commodity that can be bought and sold, such as money, securities, raw materials, indices, and digital currencies. The price of an asset is determined by the volume of trades made for that particular asset. If there is an increase in demand for an asset, the price goes up and if there is a decrease in demand, the price goes down. The fluctuation in the value of an asset over a period of time is known as the rate of volatility. The main goal of trading is not to acquire the commodity but to make a profit by buying at a low price and selling at a higher price, whether the value of the asset is rising or falling. There are five main types of assets that are commonly traded: currency pairs, stocks, indices, commodities, and cryptocurrencies.
A currency pair is the exchange rate of two different currencies. It represents the value of one currency in relation to another currency. Currency pairs are widely traded due to their high volatility and relative ease of analysis. Typically, 75% of trading activity in the market involves currency pairs such as EUR/USD, GBP/USD, USD/JPY, CHF/USD.
SHARES AND INDECES
Trading stocks and indices shares some similarities. Stocks, also known as equities, represent ownership in a company and provide the holder the right to dividends and a share of the company's assets in case of a sale. Indices, on the other hand, reflect the performance of a group of stocks and give an overall picture of the securities market. Compared to currency pairs, stocks and indices tend to have lower volatility and thus less risk, making them more suitable for long-term trades and investments.
Commodities refer to raw materials such as oil, gas, and metals that are traded on markets. These types of assets are known for their high volatility and thus provide a large number of trading opportunities for intraday traders.
Cryptocurrency, also known as crypto assets, are digital assets that are secured using cryptography. They are considered as highly speculative and high-risk assets as they can be quite volatile and their value can fluctuate dramatically over a short period of time. Due to their unpredictable nature, they can move in one direction for an extended period of time.