You can learn how to do quite a bit with cryptocurrency as you gain more experience with it. This is one of the reasons why it is a popular investment for so many people. And, undoubtedly, the most popular thing for people to do with various cryptos right now is to trade them.
Trading cryptocurrency can be a good way to earn money, but you have to know how to do it. Keep reading to learn about four things that you should do if you want to trade crypto like a pro.
Learn About Crypto History
Relatively speaking, cryptocurrency has not existed for that much time. However, there is still a history of cryptocurrency. You should learn about crypto history if you want to trade crypto like a pro. There are many resources that you can check out to learn more about the history of crypto.
In short, though, Bitcoin was the first cryptocurrency and it became available to the public in 2009. Rival cryptocurrencies originated in 2011. The price of Bitcoin reached $10,000 in 2017 and has continued to increase since then. Even now, the three most expensive cryptocurrencies are all various forks that can trace their lineage back to Bitcoin. If you understand the projects that have come and failed, as well as those that have stood the test of time, you’ll be in a great position to profit from trading.
Get Access to Data APIs
Something else that you can do in order to trade crypto like a pro is to get access to data APIs. There are many useful APIs for crypto, like APIs for DeFi trading or API feeds for crypto funding rates. In general, APIs provide you with useful information that is as up-to-date as possible. That information may include live cryptocurrency market prices, historical data, trading volume, technical charts, and more.
This information will help you trade crypto more effectively. You can make more informed decisions about when to buy or sell crypto if you have a clearer picture of that cryptocurrency’s market. The industry moves 24/7, so if you don’t have fast data, you’ll be left behind.
Study Technical Analysis
You can also learn to trade crypto like a pro by studying technical analysis. In this case, technical analysis means that you utilize historical price data in an attempt to predict how the price of a certain cryptocurrency will change in the future. You can do so by analyzing crypto charts via the use of technical indicators. You first have to understand the market trends that the crypto charts show you.
After that, you move forward with trading crypto using your understanding of those market trends. Of course, predicting the future price trends of crypto can be challenging. Still, studying technical analysis will help you trade crypto like a pro regardless.
Learn The Dangers of Leverage
In the context of crypto trading, leverage trading means that you use borrowed capital in order to make crypto trades. There are significant risks associated with leverage trading, though. One example of leverage trading is using $1,000 as collateral and trading with 10x leverage. This means you are able to sell $10,000 of Bitcoin.
However, the more leverage you use, the riskier leverage trading becomes. A 1% price change could cost you a huge amount of money if you use too much leverage. Prices can change quickly in the cryptocurrency market, so you can end up losing a lot of money through leverage trading. If you engage in leverage trading at all, it is best to use as little leverage as possible to minimize your risk.