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Understanding Actively Managed Crypto Strategies

In more detail, indicators are the data or analysis that you get from looking at charts and figures. You then combine that data and analysis from several indicators to create a strategy that includes when you will buy and when you will sell. Essentially, support lines indicate when traders think the value of the crypto is low, so they think it is smart to buy. Resistance levels do the opposite and show a lack of demand but a large supply.


If you buy the dip too early, you’ll end up losing a lot of money. For some, it’s super helpful and core to many people’s cryptocurrency investment strategy. Technical analysis is a science which helps you better predict the future by analyzing historical market data.

Free Trading Strategy Guides for All Market Conditions.

Enjoy the highest earning rates in the crypto bot strategies with top performing trading strategies. This is the platform you will hold and trade your cryptocurrency on. The stock market is indeed a safer bet than crypto, so if you want to be conservative, put say 15% of your investment funds into crypto. If you hold safe stocks and bonds with the remaining money, then you should be pretty safe. Exchanges which offer margin trading allow users to lend coins for a percentage return. When crafting your cryptocurrency strategy, cross-reference different indicators from several sources.

  • Our content is designed to educate the 300,000+ crypto investors who use the CoinLedger platform.
  • The volatility baked into this market means anyone investing in crypto takes on extensive risks.
  • In some cases, the crypto whale is making a trade that won’t suit your portfolio well.
  • Meanwhile, the main differences with the second paper are that we study daily returns and use blockchain features in the input set instead of one-minute returns and technical indicators.

The main difference is that the instruments are more volatile and may have less liquidity. There is also less regulation of crypto trading than trading stocks or another instrument type. You should always start with a small investment while you gain your footing.

Trader’s maze: crypto trading strategies

Doing your research on the founders can go a long way to protect your investments. If possible, don’t invest money that you might need in the near future. Keep in mind that trading with margin may be subject to taxation. You are solely responsible for withholding, collecting, reporting, paying, settling and/or remitting any and all taxes to the appropriate tax authorities in such jurisdiction in which You may be liable to pay tax.

A good strategy will determine whether that loss is ruinous or merely unfortunate. Scalping is a strategy for making a small profit from a large number of trades, which adds up to a larger profit. Scalping uses large amounts of liquidity to take advantage of small price changes over a short period. The time horizon is generally a few minutes but can be as short as seconds or as long as hours. The best time frames to look for divergences are usually within a four-hour or daily window.

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