Day Trading is the method of purchasing or selling a cryptocurrency. The complete process can be summed up as buy low, sell high. The “day” phase of day trading is its short-term quality. The purpose of day trading is to enter into the market, choose a state, keep a close watch on that state, and then leave at a profit. Here are the top 5 tips to make profit in the cryptocurrency world:
High Volatility and High Liquidity
The most important decision you need to take is to choose cryptocurrencies that have great volatility and great liquidity. Try to choose those cryptocurrencies that have good liquidity and volatility. There are more than 1600 cryptocurrencies and by following only the top cryptocurrencies, you’ll decrease your range of choice. Day trading more miniature cryptocurrencies can also be a highly profitable venture, but there are greater risks. Crypto prices can drop just as fast as they have grown.
Money Flow Index Indicator
This particular day trading approach employs one single technical indicator, called the Money Flow Index. We utilize this indicator to follow the movement of the cryptocurrency and to estimate when the people are buying and selling cryptocurrencies. The favored frames for the MFI indicator are 3 periods. We’re also moving to change the default purchasing and trading levels from 80 to 100 and sequentially from 20 to 0. The Money Flow Index (MFI) is a technical oscillator that utilizes price and volume for knowing overbought or oversold situations in a cryptocurrency.
Allow Money Flow Index to touch the 100 level
An MFI interpretation of 100 explains the appearance of the big sharks moving into the markets. They necessarily leave traces of their movement in the market and we can understand that movement through the MFI indicator. Technical signs aren’t regularly proper, so, jump the first two MFI readings of 100 and analyze the crypto price stability. The price requires to keep up during the first and second 100 MFI reading.
Purchase if MFI = 100
Now, wait for the MFI reading above 100. It doesn’t surely have to be the MFI = 100 reading, you can use every other MFI = 100 readings. If your point doesn’t enable you to reach the 100 reading on the MFI sign, you can just hit the next one as long as all the other technical requirements are fulfilled.
Take Profit during the first 1 Hour
The simple place to cover your emergency stop loss is below the low of the day. A division below will indicate a change in the market view, and it’s enough to get out of the trade. This can also indicate a withdrawal day. We’re more resilient when it grows to our retreat strategy. However, the only habit you need to dwell by is to earn profits during the first 60 minutes or the first hour after your trade got started.
Disclaimer: This information should not be interpreted as an endorsement of any cryptocurrency. It is not a recommendation to trade. The crypto market is full of surprises and overhyped assets. Do your research before buying anything. Do not invest more than you can afford to lose.
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