Published on: topinspired.com
The dynamic digital market is a realm of opportunities, and of course, Bitcoin is still in the spotlight, leading the market and taking the world by storm with the continuous evolution of the network. Recently, the popular coin has exceeded the expectations of investors by implementing advanced technologies that push Bitcoin to the next level, and it cannot be considered just a store of value anymore, as it can cover a broader audience’s needs, becoming a partially programmable blockchain thanks to the additional layer added to the main blockchain, and it promises even more transformations in the upcoming months. These aspects attract new entries in the web3 world who want to make a profit from the popularity of digital currency and embrace the art of trading. So, if you are a beginner in this vast field yourself who wants to master the market, in this article, you can find the best opportunities to consider and the efficient strategies that may lead to success:
What influences BTC price?
To make informed decisions for your investment, it’s crucial to make sense of Bitcoin on a deeper level and understand what exactly drives its prices. BTC is well-known for its volatility, and many sudden drops scare investors, leading them to take emotionally driven actions that end up in significant losses. So, what are the factors that could influence the value of the coin? What should you take into consideration when trying to forecast the next events for Bitcoin?
First of all, let’s unveil the importance of the interconnection between supply and demand. As you might know, Bitcoin has a limited supply of 21 million coins, which makes them rarer. Hence, users see it as an opportunity for higher returns, which directly raises the demand for the currency. When a cryptocurrency is in high demand, its price tends to grow, and since BTC ranks first in the top crypto market by market capitalization, it brings higher returns to traders from all over the world. Another aspect that plays a crucial role in determining the success of the coin is its reputation in the media. When a negative event occurs, bad news influences the reputation of Bitcoin in the public eye, and many investors rethink their choices; on the other hand, when good news arises, people see it as an opportunity and choose to embrace the currency with high expectations. Also, we should point to the latest tech launches that, reasonably, attract tech-savvy people in the market and bring the digital coin to growth.
What to expect for the upcoming months
For the last few months, Bitcoin has been very volatile, but the currency took the world by storm hitting its all-time-high on December 4th, reaching a value of over $103.000. Considering the past of the coin, it has always risen right after sudden drops, but this time it seems to be even better, and the current market conditions bring nothing but satisfaction to investors. Bitcoin is bringing high returns to committed traders, and the coin will surely remain the top conqueror in all future bull runs. Of course, the main aspects leading to the success of BTC are the innovations that have been implemented recently on the blockchain, like the layer-2 solutions that enhance the utility of the currency, enabling the deployment of smart contracts and the approval of the spot ETFs that enable a closer look at the potential of the coin. So, if you are willing to begin your trading journey, the leader of the market should be your top choice. Find out how to buy Bitcoin on a trustworthy exchange, and let’s see what the best strategies for trading are in the next paragraph.
Beginner-friendly trading strategies you should consider
Before identifying the best trading strategy for you, it’s crucial to make sense of the technical analysis of the market and learn to read charts so you can recognize the best opportunities and make informed decisions. For instance, these are the most popular beginner-friendly trading strategies:
- Day trading: this strategy is highly popular among investors, and as the name suggests, it means that they buy and sell Bitcoin on the same day. This strategy mainly depends on a technical analysis, which should guide your decisions. By opening and closing the position on the same day, you can make small profits or lose small amounts, but if you choose to adopt these strategies for multiple currencies, you can balance your funds thanks to the different movements of the coins.
- Trend trading: this strategy relates to the market trends, and you buy and sell Bitcoin according to that. You can use technical indicators like moving averages, trendlines, and strength indices to identify the relevant market trends. This strategy is best for mid and long-term trading and
- HODLing: HODL is a long-term strategy that is misspelt for “Hold” and, as the name suggests, requires a long holding of assets with no active trading. It’s considered one of the best strategies for Bitcoin and Ethereum, and it can bring long-term profits.
Manage the risks with a balanced portfolio
Diversification is a risk management strategy you should consider when facing the volatility of the digital market. The point of this method is to create a balanced portfolio by investing in multiple assets, so that you can rebalance your funds. For instance, if Bitcoin suddenly drops, you can gain from the growth of Ethereum and so on. Consider investing in other financial instruments as well, like NFTs and asset classes to enhance the opportunities of gaining returns.
The bottom line
Mastering Bitcoin trading is not an easy game, but once you study the underlying technologies that drive the market and learn about technical analysis to forecast the trends that could bring you profit, it is indeed possible to become a pro trader. Success in the digital market is the main goal of investors, and in order to win the financial freedom you seek, making sense of Bitcoin, which is the most influential coin of all time, is the first step to turning your activity into a new income.