Swing Trading Crypto – Our Top 5 Tips
Are you looking to start swing trading crypto? Great idea! It is an efficient trading practice with lots of profit potential. However, there are a few things to consider before trading. Check out our top tips for swing trading crypto to be well prepared.
Swing Trading Crypto – an Introduction
Depending on your level of experience, you might need to start from the very basics. So, if you are completely new to crypto, have a look at these definitions.
Let’s start with trading. Trading means buying and selling assets with the aim of making a profit. In the context of swing trading, we’re talking about cryptocurrencies. So, this means buying and selling digital assets. Although the tradable assets differ, the purpose remains the same in both worlds. In conclusion, trading aims at returning a profit.
So, what is swing trading? Swing trading is the practice of buying and selling crypto after a certain degree of movement in the charts. It is often done in stages. Swing trading might be a good fit for those who don’t want to spend hours on monitoring their trades.
Would you like to know more about swing trading? Check out our comprehensive guide!
Swing Trading Crypto Effectively
Now that you know the basics, let’s get more practical. Check out these recommendations to make smart trading decisions and stay safe in the market.
1. Have a Clear Plan
Sounds basic, right? But this is a crucial step. Having a clear understanding of your goals is helpful in many practices. And swing trading is not an exception to this. Most successful traders use a plan for organizing their trades and strategy. This plan might include the prices at which they want to enter at. Or the rates at which they will take profits out. Or the rates at which they will stop out for a loss, but more on that later. In conclusion, having a clear plan will help you stick to your goal and trade more effectively. It is an even better idea to have the plan in a written format.
2. Only Invest What You Can Afford to Lose
There is no way to overlook risks of losing funds when discussing swing trading crypto. Trading is a financial activity. As such, there are certain risks. The golden rule is to only trade with money you can afford to lose. Why is this so important? Well, trading with large funds that are vital for you will nudge you towards emotional decisions. That is not a good swing trading strategy. Sure, taking risks is needed for making gains. But make sure not to gamble your rent on the crypto market.
3. Use Stop-Losses
Let’s continue with risk mitigation. No matter how thorough you research or belief in an asset is, there is a chance for losses. To be a successful trader, your goal should be to keep the losses small. Luckily, there are tools you can use for that. A stop-loss tool helps you in keeping losses under control.
4. Limit Risks Overnight
Crypto markets never sleep. Hopefully, you do. So, consider making smaller overnight trades. You can also take advantage of stop losses here. Having a stop loss for overnight trades will help you mitigate risks and protect your funds while you take time off. Sounds like a better strategy than staying up all night, right?
5. Keep an Eye on Bitcoin
There are many crypto assets you can choose for swing trading. Bitcoin is definitely not the only one. However, it’s important to keep an eye on its trends. BTC is a market leader in the crypto space. So, other assets are often affected by its movements. Being aware of bitcoin’s activity will help you make more informed decisions.
Conclusion – Swing Trading Crypto
Now that you are informed of the best tips, why not try it out in practice? Head over to the CoinMetro crypto exchange and start swing trading crypto! In case you have any questions, our support team is here to help 24/7.