Crypto day trading: How to make profits in cryptos?

January 01, 2022 12:13 AM AEDT | By Ankit Sethi

Crypto day trading: How to make profits in cryptos? — Image source: Pixabay.com

Is making money in cryptos easy?

First, the 'get-rich-quick' thing can often be deceptive. Making quick money in a single day is no mean feat, let alone a piece of cake. Seasoned investors rely on news, fundamentals, events like a multi-lateral meet on key subjects like climate change to undertake day trading and capitalize on even minor price movements. The COP26 acted as a trigger for a limited bull run in Tesla shares. Online brokerages may have made trading easier, but they don't always make it profitable for the investor.

Also read: Cryptocurrencies vs. stock market: What can be the best pick for 2022?

Second, cryptocurrencies are a hyper-volatile asset class. This means that intra-day profit can dwarf a medium-to-long term bet on even an S&P 500 stock. Likewise, losses too can be deep. In such a market, being cautious is the key. Not placing all the eggs in a single basket is likely a better idea.

The best crypto day trading strategy

Consider this. In July, Bitcoin was extending its losses, but a lesser-known altcoin, Axie Infinity, which returned more than almost any other crypto in 2021, was raking in profits for its backers.

Share of Bitcoin in total market cap of crypto assets

Image description:

Data provided by CoinMarketCap.com

What makes crypto day trading a little complex is that the news headlines usually cover events related to Bitcoin or a few other major altcoins like Ether. But the market has a lot of options for investors to consider. Intra-day price movement in Bitcoin is often negligible as compared to movement in altcoins. Lately, Facebook's metaverse move immediately lifted the prices of blockchain gaming cryptos. An eye on rapidly shifting market sentiments is the key.

Also read: Top cryptos by market cap that ruled in 2021

It may be good to diversify and look at a wide range of cryptos, including DeFi, NFTs and gaming. But, as 2021 taught us, cryptos are very volatile, including even the largest market cap crypto, Bitcoin.

Bottom line

Choosing the best crypto investment strategy is a matter of individual choice. One may like to hold on to a crypto asset for very long, while some other investors may want to quickly book profits. Day trading has its own sets of opportunities and risks.

Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.