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Mastering Cryptocurrency Trading: A Comprehensive Guide

Mastering Cryptocurrency Trading: A Comprehensive Guide


Embarking on the journey through the intricate universe of cryptocurrencies can be overwhelming for those new to the domain. Whether you’re a novice venturing into the vast world of crypto or an experienced trader keen on sharpening your techniques, our streamlined guide is crafted to furnish you with indispensable knowledge and insights!

Part 1: Primer on Cryptocurrency Trading

What is cryptocurrency trading?

Cryptocurrency trading simply means buying and selling cryptocurrency to profit from its price fluctuations. Depending on the level of knowledge you possess and the risk you are willing to take, you can either trade spot - purchasing crypto assets with immediate or ‘on the spot’ delivery - or derivatives - speculating on the price of different crypto assets.


The simplest way to start is by purchasing cryptocurrencies directly from an exchange like Bitget. Alternatively, investing in stocks or funds related to cryptocurrencies is also an option.

Best cryptocurrency exchange platforms

There are several criteria when trying to find the best cryptocurrency exchange:

- Security: scammers are everywhere, but that doesn’t mean you should stop every move for them. Several exchanges have already set up their protection funds to safeguard their traders.

- Trading volume: exchanges with large trading volumes are less susceptible to price manipulations and offer a more dynamic market.

- Ease of use: how does it feel to navigate their website? What’s it like if you’re not very experienced in crypto or trading?


As the world’s largest crypto copy trading platform and top 5 crypto derivatives exchange by trading volume, Bitget has been the go-to option for over 20 million users worldwide. With our $300 million protection fund, all our users’ assets will be in safe hands. Register now and enjoy our top-notch trading experience at Bitget!


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Trading cryptos on Bitget is as easy as it is intuitive:

Step 1. Create a new account or log in to your existing one. Then, verify KYC to access all Bitget products without restrictions.

Step 2. From the main asset page, you can choose to Deposit or Transfer funds to your account.

Step 3. Enter our Markets and select your preferred trading pair.

Step 4. Customize your order details.

Step 5. Click ‘Buy’ or ‘ Sell’ to submit your order.


Check out our Beginner's Guide to learn the fundamental first steps of your Bitget journey!

Part 2: Core Concepts of Cryptocurrency Trading

Cryptocurrency Market Analysis

Fundamental Analysis (FA) Vs. Technical Analysis (TA)

Knowing when to sell and when to buy comes down to knowing the basics of cryptocurrency trading. While Technical Analysis (TA) relies solely on historical price data of an asset to forecast future price movements, Fundamental analysis (FA) incorporates other financial and project metrics to give traders a thorough and more accurate picture of each investment. Therefore, FA is more applicable for the multi-faceted crypto markets, obviously alongside the help from technical analysis.


The key difference between these two strategies is the scope of the evaluation. FA takes into account everything that affects the asset’s intrinsic value, while TA relies mostly on charts, patterns, and trends to predict its future performance. In short, FA is made up of qualitative and quantitative research, but everything TA needs is the latter.

Risk Management Strategies

Risk, in its broadest sense, describes the possibility that something bad will happen and thus presents itself in many instances of our daily lives. Acknowledging this possibility and finding a way to curb it are the basic steps of risk management practiced by many of us, who are not even aware of these technical terms.


So, what is risk management? Financially speaking, risk management is defined as the framework developed to protect a firm’s capital base and earnings against possible threats while ensuring its continuous growth. A comprehensive risk management system will help reduce costly expenses (in case an unwanted scenario manifests itself) and efficiently affect the strategic choices needed.

Types of Cryptocurrency Trading

There are various crypto trading strategies based on the trader's preferences, knowledge, time commitment, and risk tolerance. Some of the most well-known ones are as follows:

- Scalping: profiting from very small price changes, often involves hundreds of trades per day.

- Day Trading: buying and selling cryptos within the same trading day to profit from short-term price changes.

- Swing Trading: profiting from price swings in the market over a period of days to weeks.

- Long-Term Investing (Hodl): buying and holding cryptos for a long period, irrespective of market fluctuations.

Factors That Can Affect Crypto Prices

Macroeconomic Factors

Bitcoin has made the global headlines persistently since 2017 and is now considered the emerging asset class. The promising technology behind cryptocurrencies as well as their scarcity, secure them a place on many big players’ balance sheets; therefore, macroeconomic changes such as CPI, inflation, bankruptcy filings, news, events, regulatory developments, etc., can lead to an adjustment in crypto demand from these stakeholders.


To understand the relationship between macroeconomic events and crypto prices, here are our suggestions to read:

Macroeconomic Factors That Can Affect Crypto Prices

Ethereum Merge

Terra’s Fall From Grace

The Never-Ending Saga of FTX

Understanding 2022’s Crypto Bankruptcy Filings

How Does Stagflation Affect the Crypto Market?


Market Sentiment Social Media

Market sentiment refers to the attitude that investors have towards a certain asset or market category. It reflects the feelings, moods, thoughts, and biases that investors generally have on which direction the market might be heading next.

In traditional markets, traders can reasonably rely on technical analysis tools to determine market sentiment and speculate on which direction an asset might trade in the future based on past data. With crypto being a very young market compared to traditional markets and the audience mainly consisting of millennials, another field can be explored whenever a certain "new" project might lack the necessary data to perform accurate technical analysis or fundamental analysis. To get a broad overview of what people think about the markets or a specific project, you might want to investigate the social media channels of a specific project. 


New to crypto trading? Here are some foundations for you to start with:

A Beginner's Guide to Cryptocurrency Trading Strategies (Volume 1)

A Beginner's Guide to Cryptocurrency Trading Strategies (Volume 2)

Technical Analysis (TA) Explained

A Guide to Cryptocurrency Fundamental Analysis (FA)

Understanding Risk Management

Macroeconomic Factors That Can Affect Crypto Prices

Trading Terms That Every Crypto Trader Should Know

Part 3: Executing Cryptocurrency Trades

Placing a trade

Order types

Simply put, an order is an instruction from a trader/investor to buy or sell an asset in a market or on a trading platform such as Bitget. You will definitely come across Market Order, Limit Order, and Stop Loss Order - the three basic orders. 

Market Orders: The most simple must be Market Order - as the name implies, orders are executed immediately at the current market price

Limit Orders: Also set to be completed as quickly as possible, but the Limit Order will be filled at a price closest to the price you are willing to sell/buy, and can be combined with other conditions to refine your trading decision.

Stop Loss Orders: An order to purchase or sell a certain asset at a specific price is known as a stop loss order. An open position's losses are intended to be capped by a stop loss. For instance, a stop-loss order placed 3% below the price at which you purchased the asset will cap your loss at that amount.

Related articles: Know the Different Order Types (Part 1) (Part 2)

Placing your first orders on Bitget

Step 1: Choose your preferred pair

Log in to your Bitget account and navigate to the ‘Markets’ page. Use the search function to locate your preferred trading pair. 

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Click 'Trade' to proceed to the order interface.


Step 2: Customize your order

Select Order Type: The platform defaults to the Limit Order option, but you can switch to other available order types, such as Market Order, Trigger Order, or Trailing Stop.

Input the quantity of the asset you want to trade. Thoroughly review all order details before proceeding. 

Once you are satisfied with the trade details, click the 'Buy' or 'Sell' button to finalize the order.

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Step 3: Cancel / Edit orders

If you wish to revoke a placed order, simply click the 'Cancel' button.

To make adjustments to an existing order, click the 'Edit' button and update the order parameters as needed.

Tips for Successful Trading 

Cryptos attract traders and investors who seek to profit from price swings. However, it is important to acknowledge the inherent risks associated with its volatile nature. Here are some tips to help you approach crypto trading in a more successful way:


- Start with a plan and stick to it: Define your trading goals, risk tolerance, profit targets, and preferred trading strategy.

- Use a demo account: If you're new to trading or want to try a new strategy, consider using a demo account on Bitget. This allows you to practice trading with virtual funds without risking your real money.

- Start with small investments: Begin with a small portion of your capital until you gain confidence and experience in crypto trading. This approach helps you manage risk while learning from your trades.

- Build a well-balanced crypto portfolio: The goal is to really not rush into anything. We're in the middle of an economic crisis, which can continue for a long time. We recommend that you take your time to invest and think carefully about your positions. If you wish, spread your investment over time. 


And the most important thing is to keep learning and adapting. Take your time to understand how the coin works, the factors that affect its price, and the fundamentals of technical analysis. Familiarize yourself with different trading strategies and stay updated on market news and trends.


Bitget Academy provides you with in-depth guides, practical tips, and market updates covering everything from the basics of blockchain technology to advanced trading strategies. The cryptocurrency market is fluctuating, so always stay updated with the latest news, follow reputable analysts and experts, and be open to adjusting your strategies as needed.


Here are recommended articles for you to start with:

Beginner Crypto Trading Strategies Worth Considering

How to Build a Well-Balanced Crypto Portfolio

How to Trade Crypto Responsibly

Rookie Mistakes When Starting Out in Crypto

Crypto Taxes: What You Need to Know Before Filing

Part 4: Cryptocurrency Trading FAQs 

Q: When will be the best time to enter the crypto market?

A: There's no definitive 'best time' to enter the crypto market, an informed decision hinges on multiple factors. A comprehensive understanding of market volatility, the state of the market, the specifics of your chosen cryptocurrency, and a clear investment strategy is key.


Q: How to invest in cryptocurrency?

There are several ways to gain exposure to cryptocurrencies, the easiest of which is buying them directly from an exchange, like Bitget. Or, you can choose to invest in stocks or funds in the crypto industry. Several major players in this field include GBTC, SQ, and MSTR.


Q: How do crypto markets work?

A: Decentralization is one of the key concepts of cryptocurrency markets. In the traditional world, when the centralized server is shut down, you are not able to access the services provided by the server. But in the crypto world, you are able to send and receive cryptocurrencies without any intermediaries like financial institutions. Therefore, cryptocurrency markets are able to function 24/7/365. Transactions are carried around the globe at any time and place without any interruption from anyone.


Q: How do I get good at crypto trading?

A: Trading requires a unique set of skills, mindset, and qualities. Everyone has their own personal traits, but there are a few traits that have produced some of the most successful traders. Successful traders possess discipline, patience, and effective risk management skills. They never stop learning, adapt to market changes, and have emotional intelligence. Resilience is crucial, viewing losses as learning opportunities. Focus and organization play a significant role in their success.

Closing thought

This guide offers invaluable insights, aiming to guide both novices and experienced traders through the multifaceted world of cryptocurrencies. It highlights the importance of understanding trading fundamentals, utilizing platforms like Bitget for secure experiences, and implementing robust risk management strategies to navigate the inherent volatility of the crypto markets. 


While the cryptocurrency landscape presents boundless opportunities and potential for innovation and financial growth, it's crucial for traders to approach it with caution, due diligence, and a well-balanced perspective, acknowledging the possibilities of substantial rewards but also respecting the associated risks. The journey in the crypto universe is exhilarating and challenging, beckoning traders to explore, learn, and adapt in this constantly evolving domain.


Explore Bitget to start your crypto journey!