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Deleted member 24877
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How to make money with crypto-currencies
To make money trading on crypto-currencies, you simply have to buy low and sell high. Sounds simple, doesn't it? Let's illustrate this simple fact with a concrete example that will allow us to understand how much money you can make trading on cryptos:
Let's imagine that you have a trading account (or an XTB trading account) (these two brokers offer trading in crypto-currencies) and that this account is funded up to $1,000. The current Bitcoin exchange rate is below $8,400, i.e. a full Bitcoin is worth $8,400. Don't worry, you don't have to buy a full Bitcoin to trade, you can bet as much as you have money.
You practice chart analysis or apply your Bitcoin trading strategy and your forecast for the day is bullish. A significant resistance level is just under $8,400, you break out of this level and decide to place your stoploss at the last lower support level at $7,860. From your entry point at $8,400 to the stoploss at $7,860, the drop would be around 6.43% ($540 drop / $8,400 x 100 equals: 6.43%). So if you decide to invest your $1,000 upwards on the price of Bitcoin with these parameters, then you only risk a maximum loss of $64.30 in case of a bad prediction and a reversal of the price. You decide to take this trade and then wait to see how the market will develop.
After a few days, your prediction proves to be correct! The price of Bitcoin goes above $11,000 before dropping back to $10,300, so you decide to close your position. From $8,400 to $10,300 there has been an increase of $1,900, this represents an increase in the value of Bitcoin of 22.62% ($1,900 / $8,400 x 100 equals 22.62), in other words your $1,000 investment has also gained 22.62% on this trade alone, that is $226.20 in profits and for a risk of only $64.30!
You thus realize how it is possible to make money by trading crypto-currency, but also what are the risks involved in these speculative operations, which you can obviously set according to your risk aversion. The use of a stoploss is highly recommended and allows you to limit the loss in case of a bad prognosis, on the other hand you can also set up a take profit which will allow you to exit the market when a certain price level in accordance with your estimate is reached by the price.
To make money trading on crypto-currencies, you simply have to buy low and sell high. Sounds simple, doesn't it? Let's illustrate this simple fact with a concrete example that will allow us to understand how much money you can make trading on cryptos:
Let's imagine that you have a trading account (or an XTB trading account) (these two brokers offer trading in crypto-currencies) and that this account is funded up to $1,000. The current Bitcoin exchange rate is below $8,400, i.e. a full Bitcoin is worth $8,400. Don't worry, you don't have to buy a full Bitcoin to trade, you can bet as much as you have money.
You practice chart analysis or apply your Bitcoin trading strategy and your forecast for the day is bullish. A significant resistance level is just under $8,400, you break out of this level and decide to place your stoploss at the last lower support level at $7,860. From your entry point at $8,400 to the stoploss at $7,860, the drop would be around 6.43% ($540 drop / $8,400 x 100 equals: 6.43%). So if you decide to invest your $1,000 upwards on the price of Bitcoin with these parameters, then you only risk a maximum loss of $64.30 in case of a bad prediction and a reversal of the price. You decide to take this trade and then wait to see how the market will develop.
After a few days, your prediction proves to be correct! The price of Bitcoin goes above $11,000 before dropping back to $10,300, so you decide to close your position. From $8,400 to $10,300 there has been an increase of $1,900, this represents an increase in the value of Bitcoin of 22.62% ($1,900 / $8,400 x 100 equals 22.62), in other words your $1,000 investment has also gained 22.62% on this trade alone, that is $226.20 in profits and for a risk of only $64.30!
You thus realize how it is possible to make money by trading crypto-currency, but also what are the risks involved in these speculative operations, which you can obviously set according to your risk aversion. The use of a stoploss is highly recommended and allows you to limit the loss in case of a bad prognosis, on the other hand you can also set up a take profit which will allow you to exit the market when a certain price level in accordance with your estimate is reached by the price.
