Today, cryptocurrency (CC) is the most widespread type of digital currency. Its main feature is that internal accounting is conducted by a decentralized payment system, that is, there is nobody (administrator) responsible for external management. In other words, we have a fully automatic system where each user is a full participant. CC is the data that is recorded at a specific position of the information packet in the protocol. That is, we can say that CC can exist without a material or electronic form, remaining a record in the system. The first high-profile statement about CC (at that time, the term “electronic cash” was used) was recorded in 2011 when the creators of Bitcoin announced the advent of a new payment method on the internet.
The cryptography method allows you to quickly verify the credentials for operations with addresses and gain access to them using public and private keys. Consistent hashing makes it impossible to adjust information about the amount of cryptocurrency in your wallet. That is, manipulations related to increasing or decreasing the balance on a crypto wallet are excluded. The recipient’s address cannot be verified, even if the access key to it is lost. It is also impossible to find out information about the owners of the addresses. These features make CC an indispensable means of payment. Accordingly, the popularity of Bitcoin and its analogs is constantly growing. In this article, we tell you how to trade cryptocurrencies and where to start.
Choosing a Broker and Opening an Account
Of course, first of all, you need to choose a trusted and secure broker. Today, there are many companies online that offer trading using CFD cryptocurrency contracts. For instance, you can try to register on AvaTrade: fill out the form and confirm your email address and phone number. Next, you go to the account settings. If you can’t figure out the settings yourself, you can ask a question in an online chat or contact customer support. You can make a deposit in different ways: bank transfer, PayPal, and so on. Remember that you can try trading in demo mode using conditional money. If you are a beginner, then it is recommended that you take basic courses that will help you start more confidently. You can also learn on your own using articles, guides, and videos from the internet.
Cryptocurrency Selection and Market Analysis
First of all, you need to select which CC to trade. Many choose Bitcoin, but there are many analogs: Tether, Ethereum, Cardano, Stellar Lumens and others. You can also try less popular CC, but at the same time very promising coins: Dogecoin, Pi Network, Sui, Sonic, and so on. When choosing, it is recommended to pay attention to how the currency has behaved in the last month. For instance, Ethena has been growing for a long time, while Berachain is falling. You should not rush to open a deal; first conduct a market analysis. You can read the research of experts and professional traders, perform technical analysis, study the price charts, and identify patterns and trends. Traders should not forget to read the news, as the rise and fall of crypto can be influenced by political, economic, energy, and other factors.
Opening a Trade and Closing a Position
One should choose the best moment and open a deal. You can make money both on the rise and on the fall of cryptocurrency. You can close a position manually or set up automatic closing at a certain quote level. It is recommended to conduct the first transactions manually to get a feel for how the market is changing and how the trading mechanism works. You need to remember that messy and emotional trading rarely leads to positive results. It is recommended to develop a clear trading plan and follow it, making adjustments if necessary. Beginners can keep an eye on more experienced traders and try to follow them. You will have to gain a lot of experience before you can develop your own effective strategy. Also, one should never forget about risk management, use stop loss orders to reduce potential losses, and use take profit orders to make more profitable trades.
Let’s Summarize
Trading cryptocurrency is not difficult. First, you need to choose a reliable broker, register and deposit money into the account. Then, you move on to choosing crypto and analyzing the market using the data provided by the broker and information from open sources. Next, you need to assess your risks and explore risk management tools. Then, you open a trade. You should remember that you need to close the position on time in order to make the most profit. It is recommended to use trading automation tools to simplify your work. Cryptocurrencies have high volatility, meaning significant fluctuations in value are possible. Despite this, CC trading is gaining popularity, as your coin transactions are hidden from outside observers and are not controlled by the state. Try AvaTrade as a broker and you will get the opportunity to trade cryptocurrencies without restrictions.
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