*Disclaimer – I am not a financial advisor. Invest and trade at your own risk. The following is my opinion.
Crypto Day Trading and Swing Trading can be extremely profitable and there are certain things to look for in order to succeed.
As Sir Francis Bacon said, “Knowledge itself is power”. I wanted to talk about 3 things that will prepare you to take advantage of this incredible new gold rush opportunity. If you missed out on the gold rush and dot com boom now is your chance to get in early to make incredible gains in cryptocurrencies.
As a start of this series I wanted to first talk about information gathering, basic charting and some day/swing trading basics.
Day trading is described as buying and selling a coin with 24 hours. Swing trading can be defined as buying and selling coins over the course 2 – 6 days up to a couple weeks. A few of my trades are executed within minutes. Here are the 3 things I would suggest that will give you an edge in day trading altcoins. Altcoins are any coin that is “alternative to bitcoin” as bitcoin was the first cryptocurrency. Most if not all altcoins are affected by the rise and fall of bitcoin. I want to talk about 3 ways to holistically look at crypto day trading. This will be the beginning of a series on day trading altcoins. Here we go:
1. Research Coins
When researching altcoins it helps to first learn about the coins in general. While you can look at a chart and technically analyze it to make a decision to buy/sell it helps to get more information to maximize your profit. Go to one of the exchanges such as Binance.com or Bittrex.com. These are the exchanges where users can trade altcoins for bitcoin, Ethereum or USDT (which is no to be confused with USD). Go down the list of coins and further read about each one. Here are the most common places to do research on altcoins. Of course, each coin should have a website with a whitepaper that will tell you more about the use of the coin, and the technology backing it as well as the development roadmap the coin is following. Pay attention to this roadmap as it will usually call out specific dates the coin will hit major milestones. These milestones can vary from ‘creating a wallet’, ‘launching product on blockchain mainnet’, etc. The reason to pay attention to these is because it usually affects the price negatively or positively depending on how the community behind the coin interprets the achievement.
When you see a major rise or fall of a coin it means there was some sort of news behind it. Now the trick is to try and get in on the information as early as possibly to be part of the rise or avoid the fall. I know this sounds obvious but a lot of day traders just look at a coin chart and think they can determine where its going based on technical analysis alone. Places to research coins:
- Bitcointalk.org – A forum where most coins post something called an ANN which just refers to a post where coins make announcements.
- Steemit.com – This is a slightly newer website which is actually backed by a coin itself and is where a lot of people involved in cryptocurrency research and trading post information. The better the information the more the author is compensated so authors try and provide something of value.
- Medium.com – This website is where coins do a lot of their PR as well as those lucky individuals that are part of the coin affiliate program post on here as well. The same can be said for Steemit.
- Reddit.com – While reddit has a lot of information on altcoins this website seems a little more biased. Sometimes this is where people like to go to spread false news, rumors, etc.
- Cointelegraph.com – You can find general cryptocurrency news related to the cryptocurrency as a whole. The website also helps with general coin analysis.
- Coinmarketcap.com – This is a great resource that has tons of data on all coins as well as cryptocurrency marketcap, volume and coin exchange information. Coinmarketcap also has a lot of historical coin data to help you analyze coin movement.
- Cryptocompare.com – This website has “almost” real-time coin data in that the coin prices update every few seconds. This website has very detailed information regarding coins including historical data.
- CryptoDayTrader.io – This is my website where I give a list of coins and show the percentage a coin has moved up or down in the past 10 minutes in order to determine when the best time to enter a coin during the day. I am also adding more day trading features that will be released in the upcoming weeks.
Tip: Use all the resources above but keep in mind that each website and author have their own agenda and reason behind posting content. Some is based on providing valuable content to readers so that they come back and some may just be trying to pump up or trash a coin. Get research data from as many places as possible and look for commonalities and this will help you discern what is valuable information.
Tip: Find YouTubers that talk about the type coins or cryptocurrency content you are interested in. While there are a lot of biased opinions and people getting paid to endorse certain coins and ICOs you can still accumulate an amazing amount of knowledge from YouTubers as most provide some sort of valuable data in order to gain and retain subscribers. Again, take from the videos nuggets of information that will expand your knowledge but don’t blindly follow advice.
One main concept to understand is that all coins are tied to bitcoin. When bitcoin is up, altcoins are usually down and vice versa. Why? Because a lot of traders invest in altcoins in order to outperform bitcoin as they rise and fall a lot faster, however, bitcoin is where they store their profits (for the most part). Bitcoin is used as a wealth store and is the main source of volume for altcoins. Ethereum is an up and coming trading pair but bitcoin has way more trading volume making it easier to trade larger amounts of cash when using bitcoin as the trading pair along with the altcoin. Traders invest in altcoins and USDT when bitcoin is falling so not only do they get the percentage gains from the altcoin movement but also get to trade back into bitcoin when it is at a lower price and in so doing enhance their gains.
2. Have a Strategy
When looking at an altcoin to trade determine a couple of things beforehand.
– First, determine the best entry or buy price based on your research and try to get in at the lowest point possible for the day. You can do this by looking at a day chart and by comparing the previous day open and close coin cost. While this is not 100% bulletproof you can get a feel for how high or low a coin will fall based on past data. Don’t buy when a coin is at its all-time high unless you are convinced this coin will just continue to skyrocket.
– Don’t get too greedy – In traditional trading day traders would be incredibly happy with 1% – 2% gains in a day or even a week. In altcoins the volatility is so high that it is not uncommon for you to make 30% gains in a week. (This is not saying you will but it is possible). If you see a coin rising a falling between 5% and 15% most days, set a sell to get out around 7 – 10% and don’t try and catch it at the top every time. If you try and catch a coin at the top too often, you will find yourself stuck in a trade that will make you wait longer to sell or never recover.
– Determine your level of risk – In other words, analyze the coin and try and determine its day range on average and try and pick a reasonable sell position if it falls below a certain point. It is just as important to determine and set stop losses as it is to set a sell at the gain you are trying to achieve.
3. Analyze the Charts
If you are going to day trade or swing trade then you have to at least know the basics of chart analysis. You can also use some of the really helpful chart indicators that help you determine the direction of a coin such as MACD (Moving Average Convergence Divergence), EMA (Exponential Moving Average) and a few others. I will go over these in detail in the next post of this day trading series. Of course, no one can predict for sure which way a coin will move but based on technical chart analysis you can make a better-informed decision based on the statistical probability that a coin will move based on the analysis. This along with all the other research will give you a better chance of making a smart decision.
** As part of every post I will give you my picks at the moment to trade. Trade at your own risk as this is not financial advice and I am not a financial advisor. All of my coin picks use BTC as part of the trading pair as it is more volume and easier to trade than using ETH in my opinion.
CryptoDayTrader.io Top Altcoin Picks (for day and swing trading). As I write more about day trading I will go into why I choose certain coins so you can see a little more behind the curtain. I will also do some basic chart analysis:
Top 3 coins of the week
- Groestlcoin (GRS)
- 0x (ZRX)
- EOS (EOS)
Featured image courtesy of Shutterstock.
A Career in Crypto: How to Work in the World’s Fastest Growing Market
The cryptocurrency revolution is more than just a fad – it is creating real jobs in the economy. Recent data provided by LinkedIn showed that bitcoin-related job postings in the financial sector alone skyrocketed 900% over the last three years, a clear sign that enterprises were seeking cryptocurrency experts. This figure is 460% in the software industry alone.
Demand is also percolating in the freelance community, with the likes of Upwork and Freelancer seeing a surge in crypto-related job postings in the IT, marketing and content writing fields. Clearly, the crypto economy is multi-faceted, and is making people a lot of money in more ways than one.
So, what does it mean to work in the cryptocurrency economy, and what can you do to become a viable contender for one of these lucrative opportunities? Below we look at five high-growth areas you might want to consider.
Initial coin offerings (ICOs) are all the rage these days, and for good reason. The controversial, but highly lucrative crowdfunding model has emerged as the holy grail for startups wishing to fund their big ideas.
That being said, launching an ICO is no small feat. It requires complex technical, financial and marketing logistics to ensure a smooth and successful crowdraise. For professionals, this means plenty of rewarding opportunities to either join an ICO as a consultant or get hired directly by a consulting agency or ICO issuer that offers these services.
Currently, there are at least two dozen well known ICO service providers helping companies launch their token.
Join a Startup
Launching an ICO is only one aspect of the crypto economy. The businesses that develop the ICO must have a solid use case behind it. They also need to ensure they have a solid business model that will make the token raise successful in the long run.
The IT world is budding with blockchain euphoria at the moment, and there are literally hundreds of companies launching ICOs each week. If you have a background in IT, marketing, sales or business, joining a blockchain startup could just be the most exciting bet.
Keep in mind that many startups are low on cash, so it may be wise to join them on a part-time basis. If you’re looking to make a career move, it’s wise to apply to established IT companies that are jus now expanding into the blockchain.
Content Development and Marketing
Content development is one of the easiest ways to enter the crypto economy. Demand for solid writers who understand the ICO and cryptocurrency domains is absolutely huge. If you’re a good writer with a solid background in SEO, copy, journalism or analysis, the author strongly recommends that you simply email a crypto news site, blog or ICO service provider. There’s a really good chance they are searching for you.
If you’d prefer not to go the cold route, simply create a profile on Upwork and start applying for jobs. There are currently more crypto-related content jobs than you handle. Content development is one of the best ways to get your foot in the door.
If you have a background in IT, your opportunities are endless. Developers who can quickly Segway into blockchain are in high demand right now, which means there’s no shortage of exciting projects. Platforms such as TopTal usually provide the best opportunities for software developers and other IT professionals. Upwork also has plenty of opportunities in this field.
IT professionals can also offer their services directly to startups, ICO issuers and other service providers operating in the blockchain space. There are plenty of job openings on Wall Street as the big banks continue their exploration of blockchain. Governments and research labs are also expanding their footprint into blockchain. In each of these examples, you will probably spend less time working on cryptocurrencies and more time on the technology that underlies it.
Legal and Regulatory
As the crypto economy expands, governments are playing catch up to adequately define the space and bring forth meaningful regulations that can govern its use. Of course, governments typically do a poor job regulating technology, and this is duly the case for the blockchain.
That being said, the evolving legal and regulatory environment will impact the entire crypto economy. This is especially true considering that crypto regulations differ based on jurisdictions. This is placing considerable pressure on ICOs to identify a suitable jurisdiction in which to launch their token raise. It also means designing a cryptocurrency that avoids the SEC’s dreaded “securities” definition.
Against this backdrop, legal and policy professionals will see huge demand for their services. A growing number of law firms are now specializing in blockchain, and ICO issuers are also recruiting people in this field.
Like any field, entering the cryptocurrency economy as a professional requires lots of dedication. However, now is as good of a time as any to make your mark on the industry.
Featured image courtesy of Shutterstock.
A Beginner’s Guide to Ethereum: Buy Ether Now Or Wait?
When is it a good time to buy and sell a particular Cryptocurrency? That is the million-dollar question. Surely, the person who could know the answer would be a multi billionaire by now. There are, however, certain trends and signs one can look out for that may give a good indication of whether or not it is a good time to buy or sell a specific Cryptocurrency. We use Vitalik Buterin’s Ethereum as example.
What is Ethereum?
Ethereum is a very important crypto in the sense that competition is always good for business. Ethereum was introduced in 2013 by a crypto researcher and developer Vitalik Buterin. It is currently the second most popular Cryptocurrency, following Bitcoin and is said to be the next Bitcoin. Ethereum differs from Bitcoin in the sense that it introduced smart contracts to the industry. It has relatively the same qualities as Bitcoin – it is open-source and built on Blockchain, which defines its abilities and characteristics. Enabled by Ethereum, a smart contract is a computer algorithm that allows users to build or develop innovative tools and systems to perform various tasks. These smart contracts run on Blockchain and eliminate the need for third parties. It can save one a lot of time and money.
The market is very much split in two as the majority of investors put their money in both Bitcoin and Ethereum. Ethereum’s token that you can trade with on exchanges is called an “ether” and can be bought or sold not only for Bitcoin, but also for any popular fiat currency like USD or EUR. Some cryptocurrency exchanges even offer an option of converting ETH to GBP, which can now bring you around £340 per coin.
Ethereum was forked in 2016, and Ethereum Classic (ETC) was introduced to the market. There are currently talks of another fork for Ethereum Classic that is expected to happen sometime in December 2017.
The latest on Ethereum
In order to determine whether or not it is a good time to invest in a Cryptocurrency, one should keep an eye on the news. News greatly affects whether a coin’s price will spike or take a hike. Remember – buy the rumor, sell the news.
According to CryptoCoins News, Mike Novogratz, an investor, predicts that the price of Ether could skyrocket till the end of 2017. Currently, the price of Ether in USD is $437. This follows the Ethereum Foundation introducing new scaling solutions like Plasma and Casper. Ethereum can now allow for more transactions than the Bitcoin network. Bitcoin is a bit slow at the moment. Ethereum is said to have had an upgrade recently, and it will do away with unnecessary information “clogging” the system. It will also allow Ethereum’s blockchain to perform even faster while the productivity will increase to 550,000 transactions per day.
Should I buy Ethereum now or wait?
Various crypto analysts and experts give their opinion regarding the question at hand.
Novogratz was quoted in Fortune in May 2017 that he would consider buying more Ethereum if the price drops to $150 or $200. This means Ethereum would have a market cap of more or less than $20 billion. Novogratz told the news site that he believes the crypto market “has much further to run.”
On another note, when a particular coin’s price spikes, a lot of people want to jump in and buy immediately. This is not the right thing to do. Buy low, sell high, and repeat. Normally, when a coin has spiked, the market will take back 60%. By making use of some analytical tools, you can determine where this point will be. This is generally a good entry point. Despite of these and other trading tools, there is no guarantee in this industry. Majority of the time it is better to invest in a coin for a long term rather than for a short term.
One can also opt for dollar-cost averaging. It is a clever investment strategy when one buys a particular coin every month on a specific date. You may buy $100 Ethereum every 15th of a month and, over the long run, you will see your investment grow. The truth is that no one can really predict what the market will do, and sometimes it is better to buy now. It may happen that the price will never go down again.
The one thing that is great about cryptos is that you can buy a part of an Ethereum. For example, you can have a fifth of a Bitcoin or Ethereum, and if you do some day trading, you can easily grow this into one or even two coins.
It is really up to you if you want to buy Ethereum today or wait for the price to get lower. Before you invest, ask yourself this question: How much are you ready to lose?
Ethereum price predictions for 2018
According to Coin Spectator, an automated news aggregation service, Ethereum could reach $1,000. This is due to its increasing popularity and innovative technology. It is interesting to see that Ethereum spiked with more than 3,995% during 2017 whilst Bitcoin increased by more than 377%.
According to the website Investing Haven, it agrees with the $1,000 price prediction, adding that if it does not reach this price in 2018, it will surely do so by 2020. The website gives the following three factors as the reason for this prediction:
- Considering the future supply of Ether, developers may want to ensure that the number of coins remains constant. It may increase now but will stabilize after a while.
- The increasing demand and use of Ethereum’s smart contracts. The need for decentralized systems is growing on a daily basis. Investing Haven predicts that 5 – 7 years from now there will be a 20 – 30-fold increase in the smart contract apps being used.
- If the price of Ether continues growing in the same way it is now, it will attract more investors.
Where do I buy Ethereum?
There are hundreds of exchanges where you can buy Ethereum. Here is a list of reputable exchanges for you to consider. Be sure to pick the one that perfectly suits your particular needs and offers a reliable and transparent service.
In conclusion, some are saying that there is a strong possibility that Ether could eventually be worth more than Bitcoin. Investors are constantly looking out for the next best investment – maybe this is one of those?
Featured image courtesy of Shutterstock.
Understanding Cryptocurrency Price Factors
By now everyone is well aware of the incredible run that the cryptocurrency market has had this year, with bitcoin recently smashing past the $10,000 mark. Despite this however, the price journey of cryptocurrencies such as bitcoin is not simply just a vertical path upwards. The price of bitcoin experienced both major lows and highs, which were caused by a variety of factors. This article will take an in-depth look at how these factors can affect the price of bitcoin and other cryptocurrencies alike.
It is first important to make a clear distinction between the price and value of a cryptocurrency. The price of any cryptocurrency is simply the monetary cost of purchasing it, whereas the value of a cryptocurrency is its perceived benefits and usefulness. The price of a cryptocurrency is not tied to its value but instead, its perceived value. It is from this perception of value that many of the factors determining the price of a cryptocurrency usually operates.
Supply & Demand
Starting from the basics, the supply and demand of any cryptocurrency will undoubtedly influence its price. A cryptocurrency that has a lot of supply, but little demand will see very little price movement. Whereas, a cryptocurrency with a limited supply, but is very sought after will see significant price movement upwards. To some extent, this particular factor is the driving force of bitcoin’s upward trajectory. The circulating supply of bitcoin is approximately 16.7 million,this is relatively low compared to the sheer amount of bitcoin that buyers are demanding. Because of the higher levels of demand relative to its supply, the price of bitcoin increases to reflect this relationship.
Ultimately, many people will buy and sell a cryptocurrency based on its utility. In this context, utility simply means the usefulness of something. In general, the more useful a cryptocurrency is in solving a problem, the more likely that it will be bought, because a cryptocurrency that is seen as useful will also be perceived as being valuable. Take Ethereum for example, Ethereum is an open platform technology that allows developers to build and launch their very own decentralized applications (dapps).
Many people see the Ethereum project as being useful, because the project has produced some very interesting dapps that try and solve certain problems, such as TenX with cryptocurrency spending, or EtherTweet with a censorship resistant social media platform. This in turn presents Ethereum as being a much more valuable project, because not only does Ethereum make these dapps possible, but these dapps will require the purchasing of ETH (Ethereum’s cryptocurrency) to build them in the first place, causing an upward pressure in its price.
Utility is one of the most important factors to look for when deciding to invest in a cryptocurrency. If a cryptocurrency solves an issue i.e. it is extremely useful, but that is not reflected in its price, then that cryptocurrency is undervalued. This is a good indicator that, regardless of its undervalued price now, once the market begins to realize just how important the coin is, then it is likely that the cryptocurrency will see an eventual increase in its price.
Positive or negative market news can also be a deciding factor as to if a coin’s price moves up or down. The reason for this is that, depending on the market news, sentiment as to the perceived value of a coin can change. A good illustration of this point is Mt. Gox. For those that do not know, Mt. Gox was a bitcoin exchange that was based in Japan. Mt. Gox played an integral part of the bitcoin ecosystem, handling around 70% of all bitcoin transactions worldwide. However, following a security breach that resulted in about 850,000 bitcoins either being lost or stolen, Mt. Gox suspended trading and went into liquidation. During the tumultuous period face by Mt. Gox, bitcoin prices fell by 36%, reflecting negative market sentiment surrounding bitcoin at that time. In sum, the perceived value of bitcoin was negatively impacted as a direct result of the Mt. Gox incident.
Despite the sell-off that occurred during and following the aftermath of Mt. Gox, bitcoin was obviously able to recover. This scenario demonstrates the power of the utility factor. Despite the sell-off that bitcoin experienced, bitcoin’s utility remained the same. bitcoin still solved an important problem, it was a borderless payment system that could facilitate instantaneous transactions worldwide, at a very low cost. The market again gradually realized the usefulness of this, and subsequently bought back into bitcoin. The utility of a cryptocurrency has one of the most important long-term impacts on the price of a cryptocurrency. It will only be the cryptocurrencies that solve an important problem well that will remain competitive in the marketplace.
For proof-of-work (PoW) blockchains such as bitcoin, the mining difficulty of a coin can have an effect on its price. In brief, mining difficulty is simply the measure of how difficult it is to find a hash value below a given target hash. A thorough explanation of proof-of-work and mining difficulty can be found here. Initially, a low mining difficulty indicates that a cryptocurrency is easy to mine, which means that it is easier to increase the supply of that cryptocurrency, which would place a down pressure on its price. However, increased mining difficulty means that it is harder to increase the supply of the cryptocurrency, which, when compared to rising demand, may cause an upward movement in the price of the cryptocurrency. This factor requires that you have technical knowledge of the cryptocurrency that you may choose to invest in, as it may play a vital role in its price movements in the future.
In conclusion, these are just some of the core factors that can influence a cryptocurrency’s price movement. What is important to take away from this article, is that price movements are, to a considerable extent, tied to the perceived value of the coin in the marketplace. Any event that may occur, either good or bad, will affect the perceived value of a cryptocurrency, which will subsequently affect its price. This is an important principle that the cryptocurrency market largely currently operates on.
Featured image courtesy of Shutterstock.
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