The crypto market is extremely popular and also large. The number of people interested in this market is just as large, as investors are increasingly swarming into this space. But before entering this market, some people don’t carry out enough research about the space which usually ends with them losing a lot of money in the process. While trading cryptocurrencies is profitable, there is a lot of planning that goes into it just like when you’re gaming at a crazy vegas.
The first thing you should do is decide on the type of trader you wish to become. You should have a good knowledge of the different styles in this area to prepare you for your crypto journey, as it will be vital, moving forward. In this article, we will be looking at the different types of traders known in the cryptocurrency world today, including day traders, long-term traders, and swing traders. But first, what is crypto trading?
Cryptocurrencies are famously known to be virtual tokens that use cryptography as a foundation to carry out transactions and also to control the creation of new units. Also, they are decentralized so they can’t be controlled by any government or financial institution.
Meaning what’s implies, crypto trading is the buying and selling of crypto assets to make a profit. Just like traditional trading, crypto trading involves predicting the volatility or price fluctuations of these digital currencies through an exchange platform or contract for difference (CFD). However, unlike the traditional stock market, the trading of cryptocurrencies happens 24/7. Now, let’s look at the types of crypto traders, curated by experts from rivernilecasino.com.
Day traders are the most popular type of crypto trader known across the globe. They are known for buying and selling digital currencies several times a day. Their main aim is to make a profit from the little changes in price that happen during the day. Day traders are the most committed set of traders, as they are mostly invested in trading at the peak market hours. They keep a watchful eye on any small movements in the market and how it changes over time.
However, not every day in the market is lucrative for day traders. Their ultimate aim is to have a greater crypto assets value than what they started the day with at the end of each trading day.
Just as it is in the stock market, holding traders in the crypto are also called holders. They are the calmest of the traders in the crypto market. These traders will always follow a specific holding strategy. It can be considered the easiest form of crypto trading as it only requires a trader to put some money into an asset that has been backed (by research) to rise in value over time.
Holders will hold onto the crypto assets till the market becomes favourable enough to sell. They always seek opportunities to buy the dip of crypto assets or stash their cash into a new cryptocurrency (with a promising future). If the value of an asset increases significantly, the trader gains a profit on their original investment. Holding traders are long-term traders, and they decide the duration of their trade. However, they can easily withdraw their returns if they need to use them to buy other assets.
If you’ve been in the trading business for a time, then you should be able to assume who the swing traders in the crypto world are. Swing traders are basically traders that employ the use of a swing trading strategy. This is a strategy that involves making quick trades with a goal. This type of trader won’t bend or break their policy regardless of the changes in the market, as they only need to achieve the goal they set before the trade began.
Their trading session can last for days or weeks as they only depend on the technical analysis they made on the cryptocurrency before the trade started. Before they carry out a trade, they make research on the current assets in the market as well as the historical behaviour to predict future prices. Swing traders rely on market tools to analyse future behaviours of cryptocurrencies.
These are the most popular types of crypto traders in the market. So you should decide on the one you intend to become. While you can make lots of money becoming anyone of these three, you should make extra research to know the one best suited for you.
Lynn Martelli is an editor at Readability. She received her MFA in Creative Writing from Antioch University and has worked as an editor for over 10 years. Lynn has edited a wide variety of books, including fiction, non-fiction, memoirs, and more. In her free time, Lynn enjoys reading, writing, and spending time with her family and friends.