The Crypto World and Your Choices Now
November 13, 2019
The capitalization of the cryptocurrency market is higher than the budget of some states. This opens up great opportunities for earning virtual money. Cryptocurrency trading is one of the promising ways to make a profit along with mining. What is the best way to do this? Where to trade cryptocurrency on the Forex market or on a specialized exchange? What trading methods work best? You will receive answers to these questions in the article. There are two types of platforms where you can trade cryptocurrency, a Forex broker and specialized cryptocurrency exchanges. Each option has its advantages. With the crypto widget you can have the proper support now.
Forex brokers are primarily geared towards working with currency pairs, metals, CFDs. Cryptocurrencies in the list of financial instruments occupy only a small part of the total list. Often they are represented by Bitcoin, Litecoin, Ethereum and, possibly, some of the most popular virtual coins. There are hundreds of assets from universally recognized to new and little-known ones on exchanges cryptocurrency trading.
In terms of convenience, Forex brokers are more suitable for a trader. They can trade cryptocurrency through the MetaTrader platform. It is also convenient to conduct market analysis here. The technical capabilities of the platform for this purpose are much more adapted than the functionality of cryptocurrency exchanges.
Execution of transactions
The largest number of sellers and buyers of digital money is concentrated on specialized exchanges. The trading cryptocurrency on the exchange is cheaper (commissions are lower) and the rate at which transactions are executed is better than that of Forex brokers. This is not surprising. Nevertheless, trading with virtual money is not the main, but a by-product of brokerage companies.
The level of cash safety and security of transactions is higher among Forex brokers, since there are known cases of hacking cryptocurrency exchanges, and there has not been any hacking of broker’s clients’ accounts yet. Among the well-known brokers for cryptocurrency trading, we can recommend Alpari and Forex Club. The first also has an investment product consisting of popular virtual coins.
How to trade cryptocurrency: foundation or technology?
In the cryptocurrency market, all the same, laws work as on the currency market. If you open a chart of the euro-dollar currency pair and a chart of the same Bitcoin, they can be easily confused. They look almost the same. On cryptocurrency charts, figures of graphical and candlestick analysis are formed in the same way, indicators work.
However, when trading cryptocurrency, one should take into account the fact that digital money is very sensitive to news. So, Bitcoin immediately reacted to a possible ICO ban in China with a fall. If you plan to use technical analysis strategies in cryptocurrency trading, carefully follow the news and stop trading if the market begins to respond to rumors. Events that affect the value of cryptocurrencies differ from those for the Forex market.
Rumors and statements
If rumors are circulating among cryptocurrency traders that a currency is too overvalued, there is a good chance that it will fall rapidly in the near future. Statements by experts also affect fluctuations. Massively hysteria is swelling around an individual asset. It pushes traders to actively drain or buy up the currency.