Are you someone who has already dipped his toes in the crypto waters but looking for tips to improve your investment portfolio? In that case, it may be a good idea to research on the tried-and-tested crypto investment strategies and making changes to your trading strategy accordingly. You need to get information about the advantages and shortcomings of multiple trading strategies to see which will work best for you.
Top Strategies When You Invest In Cryptos:
- Hodling: This is unarguably one of the most effective and consistently-lucrative investment strategies for cryptos. It works well for beginners who may not have a proper understanding of how the crypto market works. It means buying coins and holding onto these, expecting that prices will escalate as time passes by. The strategy can prove to be profitable if you have a proper risk management plan in place and you make an effort to continue to monitor the market. Hodling is convenient because it helps you keep your emotions out of the way; it is also time-saving for a person who cannot be in front of the computer at all times to monitor daily price changes.
- Scalping: This strategy involves making the most out of smaller market movements. In scalping, you can enter and exit trades during a day or even within an hour. The main goal is to make more successful but small trades to minimize losses. This is why when you are not prepared to handle high volatility, scalping may be a safe bet.
- Day Trading: This is an easy-to-implement investment strategy that involves making high-frequency trades within short periods of time. While in hodling, as an investor, you can sit back and wait for prices to rise, in day trading, you can make trades within a single trade day. Day traders depend on leverage and must have a robust risk management plan to fall back on. In Australia, online day trading is becoming increasingly popular, with a variety of platforms now allowing you to purchase and sell assets at the touch of a button. Whether you want to trade forex, stocks, commodities, or Bitcoin, you must make sure that the trading platform you choose is ideal for you. Here’s a rundown of best trading platforms in Australia, as well as several other top platforms.
- Dips and Hold: This is a must-try for new investors where you can buy when an asset’s price dips suddenly to a great extent. Provided the asset is otherwise strong, the likelihood of prices bouncing back is very high. Price movements are influenced by news about cryptos; for instance, when news is positive, people invariably rush to purchase the overhyped cryptos. This investment strategy does not require you to consult high-frequency trade software. You only have to do one trade correctly to enjoy the profits.
- Swing Trading: In swing trading, speculations are typically made for longer time-periods. So, instead of making multiple trades, traders will purchase coins and sell these over multiple day intervals. It is risky and can take up a lot of time but it is a tried-and-tested investment strategy.
- Trend trading: This is when you are confident a trend will continue for a while and you ride on it to avoid risks. So, you basically trade along with the existing trend. When the market is up, you should invest in longer trades. When it is down, you must opt for shorter trades. The idea is to ride the trend as long as it continues and exit it only when it changes direction.