Blog

How to trade Bitcoin – Learn Concerning Bitcoin Trading strategies

March 11, 2020

Bitcoin’s value, such as this of any commodity, won’t go on to grow indefinitely. Every tendency has a finish, and investing in this fresh resource enclosing the Dollar gives some practical benefits over buying it. Bitcoin isn’t backed by any physical share, making it very difficult to value, other than by applying technical analysis to assist with short-term trade setups. This is where trading systems and proper money management come into play. That is your convenience over others who have yet to learn about Bitcoin CFD trading.

At this point, purchasing the dips would be a pretty logical choice (until proven otherwise), so we will explain how to use the current trend to your convenience (purchasing the dips). Before we have a look at a specific technique, let’s review other important aspects of Bitcoin currency.

The Bitcoin CFD Trading platform – MetaTrader 4

Yes, it’s possible to trade cryptocurrencies via Forexcaptain, including BTC/USD. Traders can access BTC/USD and other crypto pairs using both the MetaTrader 4 and MetaTrader 4 Supreme Edition plugin. Also, all of the additional add-ons for the MetaTrader 4 Supreme Edition are now also available for the latest version of MetaTrader 5 Supreme Edition.

Source: Forexcaptain MetaTrader 4, BTCUSD, Weekly – Data range: from April 29, 2012, to July 18, 2019, accessed on July 18, 2019, at 9:51 pm BST. – Please note: Past performance is not a reliable indicator of future results.

What Influences Bitcoin’s Volatility?

We would say that BTC is a bit volatile. Bear in mind that volatility is your friend as long as you apply proper money management. According to Forbes, Bitcoin gained popularity in China in 2013, and it was pretty common to see Chinese exchanges lead marketplace rallies by up to 20%. It was not uncommon for individual traders to move back and forth medially Hong Kong and Shenzhen, making benefit through arbitrage by selling Bitcoin using smartphones on Chinese exchanges, withdrawing money through bank accounts or Alipay, and purchasing back Bitcoin on the Hong Kong side, where costs were more in line with international levels.

BTC showed a huge momentum, which can be easily seen on a weekly chart. At one point, the cost was 2888.89. Buying BTC/USD has yielded many positive pips for traders.

Source: Forexcaptain MetaTrader 4, BTCUSD, Weekly – Data range: from April 29, 2012, to July 18, 2019, accessed on July 18, 2019, at 9:51 pm BST. – Please note: Past performance is not a reliable indicator of future results.

Current vs. Historical Price: Trending or Ranging?

We can easily say that the cost is trending, even on higher time frames. When you spot a big trend on higher time frames, it means that higher time frame momentum is also transferred to lower time frames. Accordingly, lower time frames (H1, H4) piggyback the momentum from higher time frames and theoretically enable intraday traders to enjoy massive benefits. At this point, the current scenario is to purchase the dips on the BTC/USD currency pair due to the established bullish trend. To always stay up-to-date with the cryptocurrencies cost as well as possible movements and trading opportunities, Forexcaptain offers
free live webinars with our experienced professional traders and analysts.

Due to the lack of long-term historical data, we can only compare the current moment with recent history (after all 2012), but it should be more than enough to go with the flow and use various strategies that might give us a lot of more benefits than simply purchasing the BTC commodity itself.

How to Trade Bitcoin CFDs

Trading Bitcoin CFDs is probably not a lot of different from trading any other currency pair, commodity, or CFD showing a strong trend. The beauty of trading lies in its diversity, and through cost action studies, traders should be able to make benefits that make them financially independent and stable. Bitcoin CFD traders should be focused on:

  1. Riding the trend (uptrend until proven otherwise);
  2. Proper money management;
  3. Focus on the major sessions: London, New York, and Tokyo.

Buying a dip in BTC/USD is important because it gives traders the opportunity to join the marketplace majority and ride the impulse. Of course, the trend will change, but at this point, BTC/USD is showing an exceptionally strong trend.

Proper money management is the holy grail of trading, and if applied correctly in a strong trending environment, it should theoretically make enormous ROI.

Traders should definitely be focused on major trading sessions as major trading centres provide the highest volatility in BTC/USD. Fortunately enough, our MetaTrader 4 (MT4) platform offers the instrument during the major marketplace sessions 24/7. It should also be mentioned that you should only trade Bitcoin CFDs with a regulated Forex & CFD broker, like Forexcaptain.

Bitcoin CFD Trading Strategies

It is recommended to use a scalping technique in order to exploit volatility to your convenience. Scalping the BTC/USD pair is performed using an excellent Double MACD technique (which is also covered in the Forex 101 course). Due to volatility and trend, this technique is suitable for trading BTC/USD on shorter time frames, such as the m5.

This technique for trading BTC/USD uses 2 EMAs (Exponential Moving Averages), 34 and 55, 2 Stochastics that are overlaid (8,1,3 and 13,1,3), a MACD 2Line indicator (34,89,34), or the default MT4 MACD – if you don’t have the MACD 2Line, and also the Forexcaptain Pivot, that can be found with MetaTrader Supreme Edition.

There can be a whole template as well as indicators which you could automatically load to a MT4 with the assistance of this Forex 101 trading program. In the event you choose to make use of the technique Forex 101, then this is the way it is possible to set this upon your own graph:

  • Open your 5m BTC/USD graph
  • Apply 3 4 and 55 EMAs. Blue could be your 3 4 EMA, Red could be your 55 EMA. Both are put on shut:
  • Add the MACD (34,89.34)
  • Add the Stochastic (8,1,3) and (13,1,3) overlaid in the equal window
  • Finally, insert the Admiral Pivot collection on daily pivots

Disclaimer: Charts for financial tools within this informative article are for illustrative purposes and doesn’t constitute trading advice or a solicitation to purchase or sell any financial tool offered from Forexcaptain (CFDs, ETFs, Shares). Past performance isn’t necessarily a sign of future performance.

  1. You purchase BTC/USD if Blue 3 4 EMA is more compared to Red 55 EMA.
  2. The cost should pull back towards the EMAs. It will stop at the EMAs or even pull-back marginally beneath them.
  3. The MACD is above 0 (or so the MACD has to demonstrate a grim histogram in the event you apply the template from Forex 101).
  4. Any One of those Stochastics ought to be underneath 20 and directed upward (preferably, cross 20 from beneath )
  5. The aim is that the subsequent Admiral Pivot with the stop-loss beneath the former fold low.

Bitcoin Day Trading Explained

For intraday trading, then you might desire to make use of our scalping technique repeatedly every time, or eventually, for those who have a day job and period doesn’t allow you to scalp, you might want to use a day-trading BTC/USD technique.

This technique involves the MACD with the
RSI and CCI indicators for intraday traders. To be able to apply this technique, you will also need to download the award-winning MetaTrader 4 Supreme Edition as it requires the Admiral Pivot indicator. The Admiral Pivot indicator offers unpreceded customisability suitable for both intraday and intraweek swing traders.

Indicators used for this technique:

  1. RSI (10, close)
  2. CCI (14, typical cost HLC/3)
  3. MACD (12,26,9)
  4. Admiral Pivot

The technique is traded on M30 timeframe. Traders purchase BTC/USD when:

  1. MACD>O
  2. RSI>50
  3. CCI>0
  4. The cost is slightly above pivot point support

Stop-loss is placed beneath the entry point, while the target is Admiral Pivot resistance. In strong trends, this should be a winning day trading technique for BTC/USD.

Disclaimer: Charts for financial instruments in this article are for illustrative purposes and does not constitute trading advice or a solicitation to purchase or sell any financial instrument provided by Forexcaptain (CFDs, ETFs, Shares). Past performance is not necessarily an indication of future performance.

Making A Profit with BTC/USD

At this point, simply purchasing BTC/USD is the way to go until the trend reverses. Bitcoin is reaching new benchmarks of value in the trading marketplace, and by using our strategies, you may be able to benefit, no matter if the trend is to the upside or downside. There are many ways to potentially make a benefit by trading BTC/USD, but due to strong volatility and hype, purchasing dips is currently the most profitable trading technique.

Rest assured that we will provide you with the latest information should there be any changes. That is why we have regular, free live trading webinars with
leading industry experts.

Market Sentiment – The Impact of The Hype from the Media

Ever after all BTC began to lift , the marketplace sentiment was surprisingly bullish, whilst BTC/USD has shrunk to 2888.89 – a high. The set began to retrace, however, the opinion is very bullish still. The press will also be over-hyping that the BTC money, however the actual argumentation may be the tech supporting the block-chain. Many businesses have been researching its profits and constraints, therefore we could expect the real estate industry to likewise undertake the block-chain hype. BTC has gained fame while the universe most useful & most profitable cryptocurrency, with a growing number of people connecting the system to an everyday basis. This may possibly produce a bubble and the up-trend could unexpectedly burst. People today treat it like a product.

The different problem with Bitcoin can be found in the simple fact that whilst the cost tag on Bitcoin climbs, it’s more difficult to obtain paid in fractional units. Sooner or later, Bitcoin could need to re issue coins (boost distribution ), however mentioning which could lead to panic on the marketplace and container , readily.

Out of those motives, the Remedy is to Not mine BTC, but instead than to
Trade it versus additional FIAT monies, e.g., USD. Additionally you will be in a position to trade it make benefit, even though it starts to drop and also a downtrend develops. Don’t forget that through our platform, you have 24/7 access to trade BTC/USD.

Trading BTC and Other Cryptocurrencies

Besides trading Litecoin versus the US Dollar (LTC/USD), Forexcaptain clients can also choose to trade CFDs on Bitcoin versus the US Dollar (BTC/USD), Ethereum vs the US Dollar (ETH/USD), and Ripple vs the US Dollar (XRP/USD).

Traders need to download
MetaTrader 4, which grants them access to the marketplace and/or allows them to follow cost action on charts. The process is very quick and simple, so you’ll be ready to go in no time. In the end, Bitcoin might not be the undisputed cryptocurrency, the trend can always change or reverse, but the invention of Bitcoin has certainly changed the world forever!

About Forexcaptain
Forexcaptain is a multi-award winning, globally regulated Forex and CFD broker, offering trading on over 8,000 financial instruments via the world’s most popular trading platforms: MetaTrader 4 and MetaTrader 5. Start trading today!

Disclaimer: The given data provides additional information regarding all analysis, estimates, prognosis, forecasts or other similar assessments or information (hereinafter “Analysis”) published on the website of Forexcaptain. Before making any investment decisions please pay close attention to the following:

  1. The analysis is published for informative purposes only and are in no way to be construed as investment advice or recommendation.
  2. Any investment decision is made by each client alone whereas Forexcaptain shall not be responsible for any loss or damage arising from any such decision, whether or not based on the Analysis.
  3. Each of the Analysis is prepared by an independent analyst (hereinafter “Author”) based on the Author’s personal estimations.
  4. To ensure that the interests of the clients would be protected and objectivity of the Analysis would not be damaged Forexcaptain has established relevant internal procedures for prevention and management of conflicts of interest.
  5. Whilst every reasonable effort is taken to ensure that all sources of the Analysis are reliable and that all information is presented, as a lot of as possible, in an understandable, timely, precise and complete manner, Forexcaptain does not guarantee the accuracy or completeness of any information contained within the Analysis. The presented figures refer that refer to any past performance is not a reliable indicator of future results.
  6. The contents of the Analysis should not be construed as an express or implied promise, guarantee or implication by Forexcaptain that the client shall benefit from the strategies herein or that losses in connection therewith may or shall be limited.
  7. Any kind of previous or modeled performance of financial instruments indicated within the Publication should not be construed as an express or implied promise, guarantee or implication by Forexcaptain for any future performance. The value of the financial instrument may both boost and decrease and the preservation of the share value is not guaranteed.
  8. The projections included in the Analysis may be subject to additional fees, taxes or other charges, depending on the subject of the Publication. The cost list applicable to the services provided by Forexcaptain is publicly available from the website of Forexcaptain.

Leveraged products (including contracts for difference) are speculative in nature and may result in losses or benefit. Before you start trading, you should make sure that you understand all the risks.

Leave a Reply

Your email address will not be published. Required fields are marked *