Understanding Short Term and Long Term Trading of Cryptocurrency


Understanding different things in cryptocurrency trading will grant you an easy time. When people exchange cryptocurrency, they use cryptocurrency trading platforms. In this case, buyers and sellers can contact each other. For example, you have Bitcoin that you want to exchange for Ether.

The exchangervirtual currency trading will help you find an Ether seller for the transaction. There are so many exchange platforms you can use out there.

Short Term Trading

bitcoin tradingShort term trading in cryptocurrencies is the process of buying and holding cryptocurrencies for only a short period. This interval can be minutes, hours, days, weeks, or even months!

You buy a certain cryptocurrency because you expect a short-term rise in its price. And when this happens, you sell it because you know that the rate of this cryptocurrency may soon fall again!

The main advantage is that changes in the cryptocurrency market occur frequently and with a fairly large amplitude. Unlike the fiat currency market, where prices rarely change by more than 1% per day, the rate of cryptocurrencies can change twice in just one night!

Long Term Trading

On the other hand, long-term trading is all about buying and holding cryptocurrencies for an extended period. Typically, this strategy involves holding the crypto for a period of about a year or more. The idea is that, despite the fact that the cryptocurrency market is volatile, the rate should rise significantly in the long term.

cryptocurrency exchangeA perfect example is the investors who purchased Bitcoin cryptocurrency at around 2011 when it was valued at 0.35 USD. If only they held their virtual currencies till 2017, they would have made profit by selling each of them for about USD 20,000 each. That is like 57,000 times of your actual investment.

Long-term cryptocurrency trading has several advantages. Unlike short-term trading, where you need to check the cryptocurrency rate constantly. You can do it in your spare time. It’s easy; after buying cryptocurrency, you just need to be patient and wait. Another advantage of long-term trading is that you don’t need to invest a lot of money. You can buy a small amount of coins and wait for the exchange rate to change in the long term. Understanding these two trading methods will grant you a smooth time in the crypto market.…

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