Trading CFDs on cryptocurrencies, like any trading instruments, is associated with risk, especially given the high volatility that is constantly observed in this market sector. However, if you have a well thought out trading strategy, cryptocurrency CFD trading can turn out to be very profitable. As they say, the higher the risk, the higher the reward. The statistics speak for themselves; In 2021, Bitcoin outperformed every other asset on the market, becoming the best-performing asset in 2021.
If you are ready to develop an effective strategy and understand what tools are right for you in order to succeed in trading, you have every chance of becoming a successful cryptocurrency trader.
How much does a cryptocurrency trader earn?
Naturally, it is difficult to determine how much profit full-time or part-time crypto traders make. Many traders choose to trade Cryptocurrency CFDs to expand their portfolio and reinvest profits into their trading. That is, cryptocurrency trading may not be the main job of many cryptocurrency CFD traders. However, there is certainly a growing trend in the world, especially among millennials, to quit their jobs in order to trade cryptocurrencies.
Unfortunately, at the moment there is not enough data to determine the earning range of full-time crypto traders.
Crypto Trading: Trading Cryptocurrency From Scratch
Every trader defines success differently. For some, this may be making a profit by trading the 30 minute chart. For others, it could be profits from trading cryptocurrency CFDs. But in the end, success comes down to profiting from the funds you risk. As with anything, the tools and information you use will be critical to your success. Below we list the basics you should consider in order to increase your chances of long-term success as a crypto trader:
Choosing the Right Broker
In order to trade cryptocurrency CFDs, you naturally first need a broker to make trades. Choosing the “right” broker can be a daunting task as there are so many options available today. Most importantly, you need to make sure that they are regulated (ideally by multiple jurisdictions). Safety is of the utmost importance, and oversight by various regulatory bodies can guarantee it.
Choosing a strategy for trading cryptocurrencies
Trading consists of making decisions about whether to buy, sell or not take any action in a particular market. Traders who have been trading successfully over a long period of time are much more likely to have a trading strategy or methodology that helps them in their decision making process. Trading strategies are used to quickly determine when to trade and when not to trade, what timeframes to focus on, what technical indicators to use, how to enter and exit a trade, and so on.
Of course, the tools you use will depend on the trading style you choose. This is the first thing to do when you are learning crypto trading. After all, if your goal is intraday trading of cryptocurrency CFDs on an hourly chart, which involves trading during the trading day for short-term profits, then using a long-term weekly chart for analysis will not be very useful. The trading platform helps you view the price charts of the instrument you are trading, as well as gives you the ability to place trade orders and manage your trades.
In copy trading, you have the ability to “copy” another trader’s trading positions, but you still have full control over your stop loss and other settings. You can learn all about copy trading in our detailed guide.