How to Trade Cryptocurrency: A Step-by-Step Guide for Beginners and Experts

CFDs are great if you’re looking for short-term profits without holding the actual asset. You can invest in more well-known crypto like Bitcoin or Ethereum, or newer and smaller cryptos. That’s not to say that these coins are always stable, but they have a longer history, making it easier to speculate on the price based on market trends. The platform you use will depend on the type of crypto you want to trade. Once you find an exchange that handles your currency, you’ll open an account, transfer funds to your crypto wallet, and make your purchase. Using whatever trading strategy you choose, you sell the cryptocurrency when the market is in your favor.

When you are ready to sell a coin, you can select the coin in your cryptocurrency exchange wallet and type an amount to sell. You can exchange this amount for an equivalent amount of another cryptocurrency coin or return the value into fiat money. The cryptocurrency market works 24/7, unlike traditional financial markets. The crypto prices are determined by supply and demand dynamics across various crypto trading exchanges worldwide. There are many factors influencing the market, such as developments in technology, regulatory news, macroeconomic trends, and market sentiment.

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I write fiction in my spare time, and I’m looking forward to getting published with my first set of short stories. An OCO stop order works in the same way but with two sets of conditions (two trigger and order-price conditions) as opposed to just one. This order type is useful if you want to place orders covering both market surges and drops. For example, if you want to sell 1 BTC with a market order, the exchange will fill your order immediately at the best available price. Given how limit orders allow traders to set their acceptable minimums and are essentially “take it or leave it” offers, they are easy to manage and allow simpler earnings and loss calculations. Having covered a lot of the key concepts above, we can now focus on submitting trading orders.

• Choosing the best cryptocurrency to invest in 2025 depends on an investor’s strategy—whether prioritizing long-term growth, utility, or diversification.
• Importantly, our information should not be seen as licensed financial advice or a substitute for consultation with certified professionals.
• Higher trading volume generally leads to greater liquidity, meaning tighter bid-ask spreads and easier order execution.
• When you are trading cryptocurrencies on margin, remember that your margin requirement will change depending on your broker, and how large your trade size is.
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Steve has been writing for the financial markets for the past 7 years and during that time has developed a growing passion for cryptocurrencies. Position trading also tends to be a good strategy for beginning traders as the longer time horizon gives them plenty of time for analysis and trade decisions. Cryptocurrency traders pay close attention to the support levels of an ascending trendline, as they indicate an area that helps prevent the price from dropping substantially lower. Likewise, in a downward-trending market, traders will watch the sequence of declining peaks to connect them to a trendline. “Hodl” is a popular term in the crypto community, originally a typo of “hold,” which now means holding onto your crypto assets for the long term.

Exchanges bring their own steep learning curve as you’ll need to get to grips with the technology involved and learn how to make sense of the data. Many exchanges also have limits on how much you can deposit, while accounts can be very expensive to maintain. Dubai, March 14, 2025 – Crypto.com has today announced it has been issued a limited licence by Dubai’s Virtual Assets Regulatory Authority (VARA) to offer derivatives in the UAE.

Instead, do you prefer to research and make informed bets every time (i.e., swing trader)? Given that cryptocurrencies seem to have more negatives against the stock market but not enough positives, why would you want to trade digital assets? Bitcoin has spurred a whole new digital coin class that can now be bought and traded on cryptocurrency exchanges worldwide. Start trading the cryptocurrency of your choice using your preferred trading strategy.

What drives prices in crypto markets?

This forms a permanent record synced to all computers using the system. Blockchain technology is often used by businesses to set up automatic contracts, known as Smart Contracts, that activate once the set terms are completed. Learn what cryptocurrency trading is, how to make your first trade, https://tokenestra.org/ and what skills can help set you up for success in this industry. Some cryptocurrencies lack sufficient trading volume, making it difficult to buy or sell without significant price slippage. Low liquidity increases market manipulation risks and limits exit opportunities during downturns.

While that’s as far as some traders go, others continue exploring and move on to the centralized exchanges such as Uniswap or PancakeSwap. In addition to using these decentralized exchanges this is also the level at which traders begin looking into yield farming or the use of leverage and derivatives in their trading. Some other options for very basic crypto trading include Robinhood and Paypal. The downside to these options is that neither allow you to withdraw crypto from their platform, and you’ll only find a handful of the largest cryptocurrencies to trade. It is also worth checking out the Coin Bureau Deals page as we have some great sign-up offers for many of the leading exchanges.

How to make a crypto trading plan

For newcomers, cryptocurrency trading can be overwhelming, with its unique terminology, complex technologies, and volatile market conditions. This guide will provide a solid foundation, explaining the basics, how trading works, and the tools and strategies needed to get started. You don’t need to meet formal educational requirements or qualifications to trade crypto for yourself.

Benefits of cryptocurrency trading

For example, you could buy bitcoin on an exchange with a lower price and immediately try to resell it on a platform showing a higher bitcoin price. You can trade the crypto you own or enter into futures, options, or contracts for differences (CFDs) agreements. These financial derivatives allow a crypto trader to speculate on the price movements of a cryptocurrency without owning it. The emergence of cryptocurrencies has created a thriving crypto asset market.