Crypto Day trading and Swing trading

Crypto Day Trading and Swing trading

In this guide, we go over differences between strategies crypto day trading and swing trading. Each of these tactics has its own advantages and disadvantages that we list out. We also provide platforms where it is possible to use crypto day trading and swing trading.

Finally, we conclude with situations where you can use these trading strategies. This article will help you determine when and how to use day and swing strategies while trading cryptos.

What is Day Trading?

The premise of day trading crypto is quite simple. You purchase a crypto that is evaluated in terms of another commodity, be it fiat or digital. Then, you sell it during the day for a higher price, earning a profit in the process. You may repeat this several times a day, on an hourly basis. The value of the trade is higher than at scalping, as you are able to do so only a few times a day.

The same process applies when selling the coin, as you bet its value against the other pair participant. You sell it high and purchase it low to earn more volumes.

What about Swing Trading?

Whereas you work on daily basis with ay trading, crypto swing trading takes a bit more time to accomplish. It usually spans over two to six days and is thus more long-termoriented than its counterpart tactic. Value of the trade is usually higher thanwith other tactics.

You are also not limited to one pair since the period of operation is almost a week. Thus, traders would engage in different pairs,earning money simultaneously over the said period.

Main Differences between Day Trading and Swing Trading

There are not any differences between swing and day trading bitcoin tactics. In fact, the point of analysis is quite similar, as you are trying to figure out trends in the price. The only real difference, carrying all other smaller ones as well, is time period in which trade takes its place. You can check out Bitfinex’s chart on hour basisin a picture below.

Crypto Day trading and Swing trading Bitfinex chart

Day trading happens several times a day using one or several trading pairs. Swingingstrategy, on the other hand, uses several trading pairs for a period between two days and a week. For day trading, you use indicators regarding changes on the hourly basis, disregarding events and external factors. Swinging, however, takes into account all external factors form news feeds as well as historical data in the past month.

Benefits Day Trading Vs Swing Trading

Both strategies allow you to invest in any level of investment, no matter if it is small or large as both require some time to pass. It also provides a good learning experience for starters, as you can make several smaller trades during the day/week, depending on your chosen tactic.

Swinging trade helps beginners to understand what is going on in the market, as you need to take external factors as well. Yield, due to how volatile cryptocurrency markets are, can be quite large if you plan your activities accordingly.

Scalping, for example, provides the very small amount of profit as you make numerous small-sized trades. Swinging and day trading, on the other hand, allow you to reap larger benefits through bigger put and call activities.

Risks

As with anything in the world, there are also risks that traders should be aware of before using these two strategies.

Day trading can be quite profitable but you also stand to lose a lot, especially when cryptocurrencies are involved. Fiat money is a lot more stable, with a very small number of fluctuations in value happening over a whole year. Crypto money is different, as severely large value changes can occur within an hour.

The same came to be said for swinging, though another risk is geopolitical movement in the market. The Chinese government, for example, has banned ICOs in 2017, driving the value of coins down significantly. Thus, all traders purchasing the coin at that time would have lost once the news hit the market.

Platforms

There are many platforms on which you can practice both of these strategies. Thus, we compiled reports on a number of them, with largest being Bitfinex, BitMex, and Binance.

Bitfinex is the largest trading platform in terms of BTC/USD pair. It offers its services worldwide and has numerous margin trading functions available for its clients. Thus, many trading strategies are possible to implement, including swing and day trading tactics. To know more about the platform, you read our guide about Bitfinex.

BitMex offers a highly customizable interface and charting tools for its traders. The said service helps investors to depict trends when applying their day and swing trading strategies. The company also has adequate margin trading tools available, as seen in the picture below this text. You can read our guide about it where we go in-depth about features BitMEX offers.

Crypto Day trading and Swing trading Bitmex screenshot

Binance is similar to BitMex in terms of available trading services. This crypto-to-crypto platform does not offer fiat trading but instead loads of altcoins for you to use. With over 100 trading pairs, Binance does provide an abundance of choice. However, its margin trading functions are lacking when compared to previous platforms. To know more, simply visit our guide about how to utilize Binance marketplace and earn profit.

Other Strategies

There are other trading strategies that you can use to earn profit form cryptocurrencies. These differ in terms of the application period and needed a level of investment. Each of these also needs different analysis and tools that can help you achieve your revenue goals.

Scalping – This strategy takes advantage of small price changes in the chosen crypto trading pair. You purchase or sell and immediately (within an hour) do the opposite to earn a small and quick profit. You do this numerous times a day, accumulating revenue throughout the process. To know more about this tactic, read our trading review that provides you how to trade using scalping.

Hedging – As the term says, this strategy is aimed at providing you with safe investment opportunities through heavy analysis of market data. The trade itself is easy to commence, as you purchase or sell based on trends. This long-term strategy does have its pros and cons, which we have gone deeper into through our guide. Like crypto day trading and swing trading tactics, hedging has its uses.

Conclusion

In this article about crypto day trading and swing trading strategies, we briefly explained tactics and how to commence them. Furthermore, we provided their advantages and risks that each trader should be aware of. Using day trading tactic might be more oriented towards experts while swinging is a good starting point for beginners.

You should use the opportunity and read our other guides about strategies like hedging and scalping to complement your knowledge.

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