How to create a trading strategy for Ethereum (ETH): Beginning Guide
Cryptocurrency trading has become increasingly popular in recent years, many investors and traders who want to capitalize on the potential of digital currencies such as Ethereum. Ethereum is one of the most precious and larger cryptocurrency exchanged with a market capitalization of over $ 400 billion. In this article, we will provide a step phase guide on how to create a trading strategy for Ethereum (ETH) and start with our investment trip in cryptocurrency.
Understanding of the basic elements of Ethereum
Before being able to create a trading strategy, it is essential to understand the basic Ethereum elements:
* What is Ethereum? : Ethereum is a blockchain platform with an open source, decentralized and transparent, which allows the creation of intelligent contracts and decentralized applications (APPS).
* How does Ethereum work? : Ethereum operates on an algorithm of work consent, which requires miners to resolve complex mathematical enigmas to validate transactions. This process is known as mining.
* Key characteristics : the basic characteristics of Ethereum include its native cryptocurrency, the ether (ETH), the gas taxes for the processing of transactions and the functionality of the intelligent contract.
Types of trading strategies
There are different types of trading strategies that you can use when they trade Ethereum:
- One day translation : Purchase and sale of ET in one day to take advantage of the fluctuations of the market.
- The trade of the interval : hold a position for a prolonged period (for example, 5-10 days) in the hope that the price will remain stable or increase over time.
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- Positioning position : Eth Sale Ancola and we have the turn and buy in a pour to take advantage of the price differences.
Step -By -Step Guide for the creation of a trading strategy Ethereum
Here is a step guide to create your trading Ethereum strategy:
- Choose a broker : select a famous online broker that offers Ethereum transactions such as Binance, Kraken or Coinbase.
- Configure a trading account : Create a new account with the chosen broker and finance it with Ether (ETH).
- Understand the market : Study the Ethereum price graphic designer, trends and technical indicators to understand their behavior.
- Define the risk management rules
: determines how much you are willing to lose in the trade or generally on a certain day.
- Choose a trading torque : select Eth/USD (or other couples) that align with your investment goals.
- Develop a trading plan : based on research and understanding, it creates a trading plan that has input and output points, risk management strategies and profit objectives.
Example of trading plan
Here is an example of a simple trading Ethereum strategy:
* Input point : Buy Eth/USD A $ 400 with a 10%position size.
* Stop-Loss : Sell Eth A $ 380 to limit losses (10%).
* Profit lens : Sell Eth at $ 420 to take advantage of the increase in prices.
* Risk management rule : Limit the general risk per day to 5%.
Tips and tricks
- ** Stay informed, but do not invest too
- Use technical indicators and diagram models : use technical indicators, such as moving environments, RSI (relative force index) and Bollinger bands, to help identify potential trading opportunities.
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Conclusion
The creation of a successful Ethereum trading strategy requires careful planning, research and execution.
