Trading forex and trading cryptocurrency isn’t en either/or option. Many traders like to do both simultaneously or switch back and forth as market conditions make one or the other more conducive to the kind of trading they enjoy. At the same time, there are those who would argue that the differences between cryptocurrencies and those traded on the foreign exchange markets are so great that you might as well compare trading in gold and buying and selling stocks and shares in tech companies.
On January 1st, Litecoin opened with a price point of $31.18. It crossed the $40 mark on February 9th and exceeded the $50 mark on March 5th. Its first major peak came on April 7th when its price rose to $93.15. After exceeding $100 for the first time on May 25th, Litecoin hit its yearly peak of $140.01 on June 12th. The recent upward price movement can be attributed to three major factors:
While Bitcoin doesn’t have a project team as such, most altcoins do. The project team can be thought of as the company. They are the people behind the coin’s idea, marketing effort and bringing it to fruition. When valuing a cryptoasset, look at the official website and try to understand the background of the company, the skills of its management and its developers.
IG’s crypto offering includes eight CFD crypto pairs alongside favorable contract specifications, weekend trading, and flexible margin requirements. IG also offers what it calls the Crypto 10 Index, a CFD that represents the performance of the ten largest tokens by market cap (think Bitcoin, Ethereum, etc.). The Crypto 10 Index enables passive investors to invest in the future of crypto without having to trade individual token pairs. (68% of retail CFD accounts lose money.) Read full review
eToro, best known for its easy to use copy trading platform, offers CFDs as well as physical cryptocurrency trading. In addition to launching its own fully-functional crypto wallet, eToro open-sourced its proprietary code for decentralized exchange (DEX) trading, as part of the Lira project from eToroX Labs. Overall, with nearly 100 digital asset pairs available to trade, eToro is our top pick for 2020. Read full review
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The risk factor inherent in both forms of trading is linked directly to the volatility of the respective markets. The fact that cryptocurrencies aren’t linked to a central provider makes them more volatile than traditional currencies. On one day in 2019, for example, the value of bitcoin slumped by 13.25%, and this was only the second biggest drop of the year. You simply don’t see this kind of dramatic movement in the forex markets.
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Price Reversal Trading - Buy Dips and Sell Rips The phenomenal trading behavior that many purchase near a price peak equally applies to selling at a price bottom. Near a price bottom the tendency is that many held-on until the end. They then liquidate their positions by selling due to a perception that price will continue to drop. At and near these top and bottom price areas form identifiable patterns that have occurred before and have been documented. It is price behavior that we can recognize as significant on a price chart that indicates the change of trading behavior. There is also a tendency near price tops or near price bottoms of heavier transaction volume. The longer price has risen prior to a price peak or fallen prior to the price bottom the heavier the volume tends to be at or near to those tops and bottoms. However, heavier average volume is not necessarily present or obvious. As with any Forex trading strategy always keep in mind that price behavior is most important. At a glance it appears the Forex trading strategy concept of buying low and selling high is difficult to practice. Without a doubt the tools and techniques that should be utilized are not properly understood and applied. If either is not understood then trading results suffer. After we learned to focus our analysis and energy on price reversal with the concept of buy low and sell high, and implemented trading analysis software tools that excel at these concepts, it separated trading success from trading failure. Trading became enjoyable.