How to Succeed with Cryptocurrency Day Trading in 2024

Cryptocurrency day trading is currently one of the main forms of investment.

Flexible hours, geographic freedom and being the master of your own routine are things that attract many investors. However, the number of people who succeed in the market is smaller than those who start out.

Do you know what successful cryptocurrency day traders do to differentiate themselves from the rest? And what common characteristics they have with stock day traders?

In today’s article, we’ve prepared some tips on how to succeed in the market with essential tips, tricks, and fundamentals to stand out. Keep reading the content to learn more.

How to Day Trade Cryptocurrencies?

Here is a simple step by step guide:

1. First of all, the first step to mastering the art of cryptocurrency day trading is to select a good exchange. Check out this and other articles on our page to learn how;
2. Then, create your registration and activate the security procedures;
3. Once you’ve done that, it’s time to deposit funds into your account. Each broker has different deposit options, such as bank transfer, credit card, PIX, among others.
4. With your account verified and funded, you are now ready to create your technical analysis environment. You can set up charts, indicators, and other tools that will help you analyze the market and make informed decisions;
5. Test and build your strategies;
6. Invest progressively, observing what worked and, of course, what didn’t. Understand the reason for each loss before investing more.

Best Brokers for Day Trading – Low Commissions and Advanced Features

First of all, choosing the best brokers for day trading is extremely important for success in your career. You should analyze their features, brokerage fees, commissions and everything that may be important in your day-to-day operations. Here is a summary of our top 3 today:

1. Binance — the world’s most famous cryptocurrency exchange.
2. OKX — day trading broker designed for traders of all levels.
3. Kucoin — day trading platform that offers advanced features and low fees.

First of all, for any cryptocurrency trader, choosing the right broker is one of the most important decisions when starting out. In other words, this choice directly impacts your analysis and your profits in the market.

Furthermore, each exchange has unique features that can suit different investor profiles. Therefore, we will now analyze the particularities of each one, including costs, deposit methods and reviews, to help you decide which are the best brokers for day trading.

Binance

Binance, the most popular broker in the world, has as its main quality the huge variety of assets and advanced functionalities.

It was founded in 2017 and has quickly become a dominant name in the cryptocurrency market. Much of this is due to its focus on technology and innovation, but always with the user in mind.

The Binance platform offers a variety of cryptocurrencies to trade. It also has technical analysis tools and detailed charts that can help you make the best decision.

When it comes to user experience, Binance has another positive point. In our analysis, we found that it is among the best cryptocurrency exchanges for beginners, but it is also suitable for more experienced traders.

Security should be a top priority for any day trading broker, and Binance seems to take this very seriously. The platform implements two-factor authentication and has an insurance fund known as SAFU (Secure Asset Fund for Users), which protects users from potential hackers.

Finally, when it comes to trading fees, Binance has one of the lowest on the market. The exchange charges a base fee of 0.1% per transaction, which can be even lower if the user chooses to pay fees using BNB, Binance’s native token.

However, it does not require a high minimum deposit and, therefore, is a very accessible option for beginner traders who want to start with little capital and still have access to advanced features to develop.

Create Binance account

OKX

Next, the exchange analyzed was OKX, a broker widely used by traders around the world.

OKX was founded in 2017 and has several offices around the world. The platform currently operates in 100 countries, and Brazil is one of them. It is also currently among the best brokers for day trading.

Furthermore, OKEx seeks to find a balance between the simplicity of an interface designed for beginners and the robustness of a complete platform for advanced traders. With this in mind, it launched its app, which is now one of the most complete on the market.

With several options of assets to trade, it has become very famous and respected in the market in recent years and this is due to the huge variety of assets and technical analyses it offers. In our use, we noticed that it is very easy to use. It is very fast for those who want to follow investment tips, take advantage of the best cryptocurrency signals for trading and increase their profits.

Create an account on OKEx

Kucoin

Kucoin is an international cryptocurrency exchange also founded in 2017. It is currently one of the most popular in the Brazilian market. Its goal is to facilitate use for all technical levels of trading.

Despite the focus on cryptocurrencies, you can also trade in other markets such as NFTs, futures, and other relevant digital assets.

Among its advanced features are the huge variety of assets and more than 300 trading pairs. In addition, the platform also has high liquidity and 24-hour support.

Furthermore, we tested their support and received a response within minutes, even at an unusual time. This demonstrates the quality of their support and their concern for the user.

In this sense, if you are looking for a day trading broker with low fees, good features and reinforced security, Kucoin is one of the best options.

Compared to others, the only downside we found was that its educational resources are limited, despite it being a good platform for beginners.

Create an account on Kucoin

Broker Comparison: How Did We Choose Our Top 3?

Our choice of brokers for day trading was based on a careful analysis of several factors essential for investors’ success.

• Variety of assets: we analyze the possibility of trading multiple cryptocurrencies, which is essential for diversification and taking advantage of opportunities in the market.
• Commissions and Fees: We evaluate cost structures to ensure traders can make more profit, especially beginners.
• Features: we check all the functions of the platforms. Technical and graphical analysis, the possibility of trading in other markets, resources for education, content and support are differentiators.
• Security: A complete platform must have high levels of security. We analyze the protection features of each of them.

User feedback: User reviews are the best way to check the quality of a product or service. That’s why we’ve reviewed several on TrustPilot and Reclame Aqui.

What are the Advantages and Disadvantages of Day Trading Cryptocurrencies?

First of all, the day trading market is only growing. CME Group, an American futures exchange that puts this investment method in the spotlight, recently became the most valuable stock exchange brand in the world. 

It is true that a career as a day trader offers several advantages, but it also presents some challenges. In other words, you need to weigh all of these things up when starting out in the market.

The biggest advantage is the high volatility of the market. Cryptocurrencies are known for the many opportunities they provide and for being a market that is constantly changing.

This offers investors a lot of flexibility and the potential for high returns in the short term.

Furthermore, it is a market that operates 24 hours a day, unlike other assets. This gives traders the freedom to work whenever they want.

Finally, the diversity of assets is also a very positive point for a career as a cryptocurrency day trader. There are a multitude of assets available to buy or sell and a lot of profit from them.

How to Create an Investment Plan for Day Trading?

It’s no surprise that those who are successful in the day trading market have a very well-thought-out plan before making any move.

A well-designed plan and strategy helps you define clear goals, establish effective strategies, and manage risks correctly.

1. Define Your Investment Objectives

The first step to creating an investment plan is to clearly define your goals. Ask yourself what you want to achieve with day trading.

Your goals may include earning extra income, building long-term wealth, or achieving your dream of financial independence. However, it’s important to be aware that the beginning isn’t going to be very profitable. Start with caution!

It is important that your goals are specific, clear, measurable, achievable, relevant and time-bound.

2. Know Your Risk Profile

As we have already said, the risk in day trading is higher. That is a fact.

Every trader has a different level of risk tolerance. Therefore, understanding your risk profile is essential to choosing the right trading strategies.

If you have a high tolerance for risk, you may be willing to adopt more aggressive strategies that offer higher returns but also higher risks. However, if you are not comfortable with risk, this strategy may not be for you.

3. Establish a Trading Strategy

Now is the time to create your trading strategy based on the goals and risks you have defined. There are several day trading strategies, such as scalping, momentum trading, and news trading. Study them and choose the one that best suits your goals.

Finally, your strategy should include specific criteria for entering and exiting trades, as well as the market conditions you are looking for.

4. Have Risk Management

First and foremost, risk management is a fundamental part of any investment plan. In this sense, clearly define how much of your capital you are willing to risk on each trade.

A common rule of thumb for successful traders, for example, is to not risk more than 1-2% of their total capital on a single trade.

Additionally, you can also utilize tools like stop-loss orders to limit your losses on individual trades.

5. Monitor and Review Your Plan Regularly

Lastly, we know that the cryptocurrency market is constantly changing, so it’s important to review and adjust your strategy regularly.

Track your trades and evaluate your performance to see what’s working and what’s not. And of course, be willing to make adjustments to your strategy as needed.

Crypto Day Trading Tips and Tricks — What to Look Out For?

Can cryptocurrency day trading bring results for some? Yes. But there is no shortage of challenges and risks involved.

Therefore, to increase your chances of success, it is important to pay attention to some tricks and tips that can help you reach higher places. But first of all, know that there are no better tips and strategies than your own. Learn, test and know what works for you before following any advice.

1. Get Access to Real-Time World News

You’ve probably seen some news that impacted the rise of some crypto. Cryptocurrencies are heavily influenced by global news and events. A regulatory announcement, an important partnership, or a network upgrade can cause major price swings.

Therefore, one of the main tricks to success is to master these movements. And to do this, you can gather alerts and apps with the latest news in real time.

2. Use Technical Analysis Tools for Day Trading

Additionally, technical analysis is an essential tool for any day trader. Use charts, indicators, and price patterns to make informed decisions about when to enter and exit trades.

Tools like moving averages, RSI (Relative Strength Index) and MACD (Moving Average Convergence/Divergence) help you in this matter.

3. Set Profit and Loss Limits

Before entering a trade, clearly define when you will exit. This includes both your desired profit levels and acceptable loss limits.

Initially, entering a trade without a goal may not be worth it and expose you to unnecessary risk.

Top Cryptocurrencies for Day Trading

Firstly, choosing the right cryptocurrencies for day trading is a key part of success. Some cryptocurrencies are better suited for day trading due to their liquidity, volatility, and predictable behavior.

Therefore, to make your study easier, we will talk about three categories of cryptocurrencies frequently chosen by day traders.

Capitalized and Reputable Cryptocurrencies

Large-cap cryptocurrencies with a good reputation are currently the best known and most trusted:

Ethereum (ETH) is a popular choice among day traders. This cryptocurrency has high liquidity and is widely accepted, meaning you can enter and exit positions with ease.

Additionally, the Ethereum network supports smart contracts and decentralized applications (dApps), adding value to its ecosystem and attracting a large user base and investors.

Bitcoin (BTC): Bitcoin is the most well-known and traded cryptocurrency. Its high liquidity and trading volume make it ideal for day trading. Additionally, due to its popularity, Bitcoin has a significant amount of historical data available for technical analysis.

Sealana ($SEAL): A more volatile option, but with a good reputation, is Sealana. Its pre-sale recently attracted attention, raising over $3 million. It is a good option for those willing to take on greater risk.

Cryptocurrencies With Balanced Volatility

Some cryptocurrencies are known for their balanced volatility, which can provide good profit opportunities for investors.

These cryptocurrencies tend to have significant price movements, but in a controlled manner, allowing for profitable trading without excessive risk.

Binance Coin (BNB): BNB is the native token of the Binance platform and is used to pay transaction fees on the exchange. BNB often exhibits balanced volatility and is a popular choice among traders due to its utility and growing adoption.

Cardano (ADA): ADA is another cryptocurrency that offers balanced volatility. Developed by a team of academic experts and engineers, Cardano is known for its scientific approach to blockchain, attracting many investors and traders.

Cryptocurrencies With Predictable Technical Behavior

For day traders who rely heavily on technical analysis, choosing cryptocurrencies with predictable behavior is a great option.

These cryptocurrencies tend to follow technical patterns that can be identified and leveraged for profitable trading.

Ripple (XRP): XRP is known for its predictable technical behavior. The cryptocurrency often follows price patterns and technical indicators, making it a popular choice for traders who use technical analysis.

Litecoin (LTC): LTC is another cryptocurrency that has predictable technical behavior. Similar to Bitcoin but with faster transaction times, Litecoin is a popular choice among day traders looking for predictability and arbitrage opportunities.

What Technical Indicators Should I Consider for Day Trading?

Technical indicators are very important tools for any day trader. They help analyze past and present price movements to predict future market movements.

1. Moving Averages

Moving averages are one of the most basic and widely used indicators in technical analysis. In short, they help smooth out price data to identify the general direction of the trend.

There are two main types of moving averages: the simple moving average (SMA) and the exponential moving average (EMA).

The EMA gives more weight to recent prices, making it more sensitive to new information.

2. Relative Strength Index (RSI)

RSI is a momentum indicator that measures the speed and change of price movements.

It ranges from 0 to 100 and is used to identify overbought and oversold conditions. An RSI value above 70 indicates that the asset may be overbought, while a value below 30 suggests that it may be oversold.

3. Bollinger Bands

Bollinger Bands are composed of a central moving average and two standard deviation bands.

They help identify periods of high and low volatility. When prices move outside the bands, it can indicate an imminent trend change.

4. MACD (Moving Average Convergence Divergence)

MACD is a momentum indicator that shows the relationship between two moving averages of prices. It consists of a MACD line, a signal line, and a histogram.

Thus, crossovers between the MACD line and the signal line can provide buy and sell signals.

5. Stochastic (Stochastic Oscillator)

Lastly, Stochastic is another momentum indicator that compares the closing price of an asset to its price range over a period of time.

It allows you to identify overbought and oversold conditions, as well as potential trend reversals.

What Do the Best Investors Do to Make Profits in Day Trading?

First of all, the Quantified Strategies website shows that 40% of day traders give up within a month, and only 13% continue after 3 years.

So, be aware that it’s not easy to be among the best day trading cryptocurrency investors. However, with the tips below, you can take another small step towards this select group.

1. They Study the Market Like a Science

First and foremost, successful traders never stop learning. They are constantly updating their knowledge of cryptocurrencies, technical analysis, fundamental analysis, and trading strategies.

It is always important to take classes with experts, take workshops, take online courses, read books and join trading groups. In short, these are common practices among these investors.

Additionally, researching new cryptocurrency projects, emerging technologies, and global economic events is essential.

Ultimately, understanding how these factors can impact the cryptocurrency market allows traders to make informed decisions and position themselves appropriately to take advantage of opportunities or mitigate risks.

2. They Have Adaptability

The cryptocurrency market is very dynamic. Therefore, successful traders are adaptable and ready to adjust their strategies as market conditions change.

Furthermore, being willing to learn from each experience, good or bad, is essential. This involves analyzing mistakes and identifying opportunities for improvement.

Ultimately, adaptability is not just a response to external changes, but also an ongoing internal process of refining and adjusting one’s own skills and strategies.

3. Monitor and Evaluate Your Strategies

Top traders constantly monitor their trades and evaluate their performance. As such, they keep a detailed trading journal where they record their strategies, decisions, and results. This helps identify patterns of success and areas for improvement.

Additionally, many traders use performance analysis software that provides data on their trading activities. These tools can provide charts and reports that make it easier to understand trends and patterns in your trading.

In short, constantly monitoring and evaluating your performance not only helps improve trading strategies, but also strengthens discipline and patience, which are essential for success in day trading.

4. They Have Discipline and Focus in Day Trading

First of all, if you talk to 10 successful traders, at least 8 of them will choose one priority word: discipline.

In other words, to be successful in investing in cryptocurrencies, you must follow your investment plan with discipline, avoiding guru illusions and impulsive decisions based on emotions.

Keep a trading routine to record your trades and reflect on your successes and failures. This way, you can identify patterns and improve your skills over time.

5. Use Technology to Boost

Some traders choose to use trading bots to automate their strategies. These bots can execute trades based on pre-defined parameters and help remove emotions from the trading process.

However, it is important to configure and monitor these bots carefully, as they can make mistakes if not tuned correctly.

One of the main advantages of trading bots is the ability to remove emotions from the trading process.

Human traders can be influenced by feelings of fear or greed, leading to impulsive decisions that often result in losses.

Bots, on the other hand, strictly follow the programmed rules, ensuring that all trades are executed as per the established strategy, without emotional interference.

In this sense, there are many trading bots available on the market, each with its own characteristics and functionalities.

Some bots are designed for beginner traders and come with pre-defined settings and user-friendly interfaces, while others are highly customizable and aimed at more experienced traders.

Conclusion About Cryptocurrency Day Trading

In short, cryptocurrency day trading is an activity that combines excitement, challenge and the possibility of high financial returns.

Therefore, first of all, preparation is essential. Before you start trading, it is crucial to study the basic and advanced concepts of cryptocurrencies, as well as market analysis techniques.

Furthermore, learning how to read charts, interpret technical indicators, and understand the factors that influence the market allows you to make more informed decisions. This detailed analysis can make the difference between a successful trade and a significant loss.

Managing risk is another critical aspect of cryptocurrency day trading. Setting clear rules for how much of your capital you are willing to risk on each trade and following those rules strictly can protect you from devastating losses.

Diversifying your portfolio and never investing more than you can afford to lose are principles that help mitigate risk. Ultimately, success in cryptocurrency day trading is a continuous process of learning and adaptation.

Analyzing your mistakes, learning from your experiences, and being willing to adjust your strategies as needed are all attitudes that can lead to a profitable and sustainable career in day trading.

FAQs — Frequently Asked Questions

Siga o Afrilatest no