The best cryptocurrencies for day trading
Day trading is a very popular strategy on the cryptocurrency market because of its high volatility. It can be potentially lucrative too, with many people earning tens of thousands of dollars. However, you can’t just go into any market. You need to analyze many factors and find the best cryptocurrency for day trading from them. So which is the best one today?
What is daytime cryptocurrency trading?
First, you need to understand what trade means. It’s an exchange of currency for another. In other words, trading cryptocurrency is exchanging assets. The goal is to sell at a higher price than it was bought for.
Day trades are a strategy in which you trade many times during the same day. This way, you have to close all your positions by the end of that day. It should also be noted if a trader does not want to lose their entire budget, they should take into account the level of risk involved with their position and must work with multiple factors.
Traders have found success using a number of cryptocurrency trading strategies, but for those looking for quick profits, this can be an difficult way to make money. One strategy you might want to try is closing out a lot of positions at the end of each day. This technique doesn’t work well with long-term investors because it can lead to frequent trades back and forth which takes.
Factors for choosing a cryptocurrency for day trading
Day trading is not a profitable business all the time. Some of your trades will have losses. This may be because of price manipulation, probability theory, or you making a mistake. You can increase your chances of profit & minimize risks. Just analyze these key factors:
- Volatility.
- Scope.
- Trading platforms.
- Liquidity.
- Active Team.
- Latest news.
Cryptocurrency traders check the readings of these factors daily. This is the only way to maximize profits. Without in-depth analysis, you will not succeed.
Trade volume
One of the best ways to see what direction a cryptocurrency is heading in is trading volume. It not just tells you how well the coin will do in the future, but it also tracks its current value over different time periods. In this way, traders can find out if the change in value is due to an anomaly or the norm. For example, if a particular assets has low trading volume, high market activity over the last 24 hours can mean increased support from other traders so prices can rise.
Tether has the highest trading volume, with a maximum of about $54 billion. Bitcoin is second with around $40 billion and Ethereum has around $20 billion. The list of currencies that have a daily trading volume greater than $3-5 billion changes frequently. Litecoin, EOS, Bitcoin Cash and Tron are some of the coins on this list.
Volatility
An indicator called volatility is a measure of the price variation of cryptocurrencies that can be seen in a particular day. If the change in price is significant, then it implies that the currency is more volatile. A good example for this behaviour would be gold or bonds, which are known to have a stable price and thus not to fluctuate often.
Volatility is an indicator to the level of risk in a trade. Generally, high volatility means that the trades can be profitable if done properly. On the other hand, low volatility levels imply lower risks and higher reliability.
Crypto Exchange
To start off, it’s important to check the volumes on different exchanges. Different platforms have different focuses and can tend to be oriented towards a particular part of the world, like for instance Kraken is primarily for Europe while Huobi is primarily an Asian exchange. To have less difficulty with day trading, it is better to choose platforms that operate globally, such as StormGain.
Aside from cryptocurrency exchanges, it is important to recognize day trading instruments. Holding only one instrument can limit the number of open positions you have in a short timeframe.
Liquidity
Liquidity is an indicator for all traders; it allows them to be on the market without any trouble. It also enables them to close and open positions along with their convenience.
Assets with high liquidity can be traded at fair prices. Additionally, high trading activity ensures that all sellers have to set competitive prices. High liquidity ensures that prices are stable. It is unlikely to see a sudden change on the market when one order gets placed, for instance.
Active Team
If you want to make money trading cryptocurrencies, it’s vital to understand that the development team should always be active. Check what they’re doing regularly and read their opinions. The team is very active, and because of it, we can report on information about this currency in real time. Why not take a stab at day-trading with us? Their trading approach means you won’t take as much risk.
Latest news
Breaking news is one of the most important things for the market. You will not meet a successful trader who does not follow Breaking News, CNN, BBC and other channels. Certain types of news have a significant impact on the market and can change trends for most cryptocurrencies. It is very important to choose assets for day trading that do not have bad news, as their prices will be more stable.
The best cryptocurrencies for day trading
Beginners often try day trading because this strategy does not require any special skills. Nevertheless, it is important to make sure you’re picking the right coins to trade with!If a trader chooses assets with low liquidity he will not earn much on day trading. That’s why there is a list of the best cryptocurrencies for day trading.
Binance Coin (BNB)
Binance is a popular exchange and it’s trustworthy to use their coin because they have been in the business for so long. BNB is just 2 years old but in a couple of years, people will be ready to see its power. That is why it has a stable exchange rate and high trading volume. Many analysts and exchanges recognize this asset, so collapsing its rate will be very difficult. So, if you want to start day trading, you can start with BNB.
Ethereum (ETH)
Ethereum is as popular around the world as Bitcoin. One reason is that Ethereum is not only a cryptocurrency, but also a blockchain platform that allows development of decentralized applications and creation of new tokens. There is usually a lot of good news associated with this asset, so traders can use it for day trading without fear.
In addition to ETH having many trading pairs, it also has a strong liquidity ratio. Many traders utilize this to trade ETH as one of the best cryptocurrencies available, making it easy and accessible anytime and anywhere.
Tron (TRX)
Tron was created as a platform that aims to remove all boundaries on the Internet. It provides rewards for sharing content. The best part is that you can earn TRX by adding anything from common memes to complex applications. The creators of this platform have valuable ideas, which is why its cryptocurrency is growing fast and trustworthy in the markets.
The TRX team is one of the most active: it develops the platform every day. Thus, you can find a lot of positive news on various sites. That’s why the popularity of Tron is growing every month. Even bad news does not affect its price, as there are many TRX supporters today.
If you want to start day trading, TRX might be your best choice. This cryptocurrency trades at low prices, so you don’t need a large budget to start trading. It’s also quite stable, so it will be easier to manage risk.
Conclusion
Day trading can be either easy or hard. It all depends on your trading style and the cryptocurrency you choose. However, if you work with the above factors and know everything about the cryptocurrencies in your portfolio, you stand a good chance of making money – unlike many traders who lose money when not being knowledgeable enough. Who knows, maybe someday you will leave your regular job.