Cryptocurrency exchange trading - What is the peculiarity of such trading?

Exchange transactions and speculation on cryptocurrency exchanges are identical to any other. You have to buy cheaper and sell more expensive in order to make a profit. That is, just like investing in a regular currency.

 

Naturally, the base of instruments and the principle of setting trading targets are set in the same way as in the securities or Forex markets. Making a profit trading virtual money will not be a problem for those who know the basics of trading stocks, securities and national currencies.

 

The principle of cryptocurrency exchanges does not differ from exchanges working exclusively with dollars, yen and other common currencies of the world. How to earn on a cryptocurrency exchange? Very simple. You have to buy Bitcoins cheap and sell them expensive. The difference between the first and the second will be your net profit.

 

Bidding is done in the form of an auction. The current rate of the currency is set by the broker, who takes into account the rate of previous auctions, as well as the Central Bank. Anything - even bad weather - can bring down the exchange rate. Therefore, the trader must keep the situation under control.

 

One of the most common mistakes of beginning speculators is to drain currency reserves when the rate falls. Beginners do not know how to wait, they are afraid to lose even more and often remain in the red. Earning on the cryptocurrency exchange requires endurance and patience.

 

Any form of analysis and prediction that is so actively offered to cryptocurrency newbies is a failure. The fact is that Forex and other major exchanges do not work with cryptocurrency due to high risks and low predictability.

 

In e-money, just 1 person with $20-30 million in his hands can both increase or decrease the rate by 50% within an hour. Therefore, all the forecasters telling you how to make money on cryptocurrency are wrong in most cases.

 

The cryptocurrency is absolutely unstable. As of 2013, its exchange rate increased by more than 5 thousand percent. Of course, this simply cannot happen to the dollar or the euro (or rather, in this case there will be a collapse of the world economy). But volatility is not always a bad thing. For example, in a classical exchange, you need to invest as much money as possible to get a decent income. But on cryptocurrency exchanges, in some cases, it is enough to invest only 5-10 thousand rubles and become a thousand times richer within a year.

 

Unfortunately, it is almost impossible to find competent news on the rate of cryptocurrencies and reasonable forecasts. Working with Bitcoins and other cryptocurrencies is always accompanied by a lot of risks, but here you can at least "drink champagne". For those who do not like to take risks, it is better not to use cryptocurrency earning sites, and choose Forex and other classic exchanges.

 

There are several types of cryptocurrency trading:

 

1) Classic trading, repeating strategies on stock and currency markets.

2) Arbitrage between cryptocurrency exchanges.

3) Investing at the start (or before the start) in a cryptocurrency project or fork.

4) Working with Bitcoin derivatives.

5) Working on PAMM accounts.

 

Today, arbitrage between exchanges has almost lost its relevance, despite the huge number of automatic trading systems, working in this direction.

 

Working with forks at the very beginning is a fairly high-risk business, fraught with big opportunities as well as big losses. In addition, a guaranteed success in this type of trading is only possible with the insider information, which is usually questionable and not always legal.

Legitimate information about promising forks can be found on thematic forums - in official themes of new cryptocurrencies, where users can be attracted by description of this or that coin and due to correctly presented information and visible advantages, they will start buying it. The main source of such information is https://bitcoinup.eu/, but when the information appears in wide access, it loses its relevance.

 

Because there is no stable and serious work with large volumes for beginners on forks, there is only cryptocurrency trading, fully repeating the principles of usual currency or stock markets, as well as working with Bitcoin derivatives, the simplest example of which is CFD (Contract for Difference).

 

Cryptocurrency exchanges operate similarly to regular stock and currency exchanges. An experienced trader just needs to spend some time studying the specifics to start working in a new environment, while a beginner takes as much risk as playing the lottery. In order to get accustomed faster and not get a serious loss, beginners in crypto-trading should learn and understand two or three simple strategies that can be applied to any of the existing exchanges.