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- Insights
- Cryptocurrencies
- Stocks
- White Papers
- Industry
- Geography
Cryptocurrency is the 'hottest' term in the financial sphere today. Whenever we talk about profitable investment, somebody or the other brings in cryptocurrency, especially bitcoin, into the conversation. Bitcoin alone accounts for over US$6 billion worth of transactions every day, and there is a lot more when you take other cryptocurrencies into account. Financial literacy among the common public is very low and many fall behind in understanding the functionalities and price oscillations of cryptocurrencies. Although cryptocurrency trading strategies are not simple and can't put all your eggs in the same basket, they can help crypto investors not fall into the unexpected pit. However, cryptocurrency investments are riskier than any other form of trading. Therefore, crypto investors should look before they leap and follow important cryptocurrency trading strategies to stay ahead in the race. In contrast to traditional investment ways like stocks and bonds, trading in bitcoin and other cryptocurrencies has attracted an array of younger and tech-savvy crowds. They share a lot of easy cryptocurrencies investing rules on social media and online platforms like Reddit. In this article, Analytics Insight has listed the top five cryptocurrency investing rules that traders should follow in 2021.
Many people in the investment circle now go to fixed cryptocurrency investment policies. According to the investment rule, crypto investors fix an amount and time interval for continuous buying. For example, if they pick Ethereum as your ideal cryptocurrency, you should invest US$100 every month on the first or fifteenth continuously. This approach of buying a fixed amount of cryptocurrency at regular intervals can boost the investment value at some point. It has high benefits for traders who invest in cryptocurrencies for the sake of investing. Some online platforms also offer automatic investment plans that take your money and buys cryptocurrency every month without your intervention
Golden cross and death cross strategies use two moving averages (MAs) at their core to devise an effective investment plan. Moving Averages (MAs) is a chart indicator that shows the mean average price of an asset over a defined period of time. While keeping track of this strategy, investors will look for crossovers between 50 MA (an average of the previous 50 days) and 200 MA (an average of the previous 200 days). If the 50 MA crosses above 200 MA, then the investors feel that it is a safe cryptocurrency to invest in. If it goes below 200 MA, then it is called a death cross.
If you are someone with experience in the investment circle, then you should already be familiar with various resources and strategies. But to effectively put them to use, you should engage in other cryptocurrency investment strategies. For example, on a general scale, there are two types of trading strategies namely active and passive. Active users keep a tab on price flows, while passive users allow for a hands-off approach. Active strategies are more popular among crypto investors. They entirely exhibit the position of the cryptocurrency and try to switch the investment coin if the current one is falling.
Investing in a single cryptocurrency is often called an immature investment plan. Yes, if the cryptocurrency price takes a dip, then all your investments will be gone. Take Bitcoin as an example. Bitcoin investors faced big price hits during the past couple of months. Over the fear of losing their capital, many withdrew their bitcoin investment, pushing the cryptocurrency to further go into crisis. Fortunately, cryptocurrency investors can keep away from the sudden fall by maintaining a healthy portfolio. A healthy portfolio involves investing in more than just one cryptocurrency. This cryptocurrency investment rule helps in minimizing losses and maximizing profits. It takes investors to a new level where 'winning some and losing some is better than losing it all.'
This rule is mainly for new crypto investors who don't know much about digital currency trading. Despite its decentralized mode and unbreakable blockchain technology, many crypto exchanges continue to suffer the occasional hack even today. Therefore, as a beginner, it is extremely important to choose a platform that has the best-in-class security that invests in regular security audits to ensure a highly secured cryptocurrency trading platform.
