Against the background of the growing demand for bitcoin, more and more people are wondering “how to trade bitcoin”. Bitcoin occupies about 75% of the entire cryptocurrency market globally, and its popularity is only growing.
Earnings on bitcoin attract many traders. First of all, bitcoin trading is carried out directly, not by the asset itself. By opening a deal on bitcoin, a trader makes a forecast for an increase or reduction in the price of a cryptocurrency over a certain period of time and earns up to 90% with the right direction of movement of BTCUSD quotes.
In trading, bitcoin is used as follows:
- As a currency for opening and replenishing a deposit. The account has no restrictions, the user places bets and performs deposit and withdrawal operations;
- As an ordinary trading asset. To earn, a trader makes a forecast of the future movement of quotes and opens a deal to increase or decrease the price of Bitcoin. In the Olymp Trade trading platform, bitcoin is referred to as BTC or a pair of BTCUSD (Bitcoin/US dollar).
How To Predict Changes In Bitcoin Quotes
Cryptocurrency Bitcoin lends itself to all the most common types of technical and fundamental analysis. For making trading determinations, use:
- Technical analysis. It relies on data from various indicators;
- Fundamental – conclusions about future price fluctuations are made after examining a whole range of economic and political factors. It would seem that bitcoin is not tied to a specific country, but it reacts, for example, to information about hacking of cryptocurrency exchanges or about large investments by investors who hedge their risks.
An investor who prefers to trade Bitcoin should know some of the subtleties of trading this cryptocurrency:
- Many experts recommend opening deals on bitcoin, regarding the steadily growing trend of cryptocurrency in the medium and long term. Expiration time – from 60 minutes to 7 days;
- Making short-term bets on bitcoin is quite risky, especially for minute periods (60 seconds);
- Bitcoin trading is conducted 7 days a week, but on weekends the market is full of speculators, so experienced players have a rest;
- To boost the chances of a successful forecast and stable earnings, take into account both the signals of technical tools and the news background;
- Gaps often appear on the Bitcoin price chart – significant gaps between the opening and closing prices. The reason is the release of important news or troubles with the liquidity of the cryptocurrency market;
- The high volatility of this cryptocurrency is likely regardless of the trading session;
- So far, there are no indicators made only to analyze the behavior of the BTCUSD pair, so you have to experiment with the available technical analysis tools.
Beginners are not recommended to work with Bitcoin because the factors affecting changes in its quotes have not yet been thoroughly studied, so they will not receive answers to many questions. Finding helpful literature on bitcoin trading is also quite tricky.