The growth of crypto investment is very fast, and it cannot be denied that many crypto investors still do not fully understand trading or crypto investment itself. It is not uncommon for traders to only FOMO or follow the crowd, resulting in losses.

There are many things we can do when entering the crypto world, not limited to investment; we can do scalping, swing trading, staking, daily trading, and much more.

In this article, we will focus on discussing what daily trading is, which is one of the things we can do in the crypto world to earn profits every day. It's not just about luck; daily trading has strategies and several things we need to pay attention to.

What is Day Trading?

Day trading is the activity of buying and selling crypto assets on the same day repeatedly with the aim of profiting from the fluctuations in crypto prices every day.

Because it is not uncommon for the price of a crypto asset to rise or fall significantly in a single day. And this momentum is what a crypto trader takes advantage of to engage in daily trading.

This daily trading activity is quite popular among crypto traders for several related reasons, such as:

  • Enticing Profit Potential

    In a day, you can make a lot of profits if you are smart enough to read market movements, as you can buy and sell repeatedly, meaning you also earn repeatedly.

  • Flexible

    You can engage in this trading activity at any time, without being bound by time rules like working hours.

  • Adrenaline Rush

    This trading activity is often considered to provide an adrenaline rush because of the thrill felt when entering the market, making this trading feel exciting.

Things to Consider Before Starting Day Trading

  • Choosing the Most Comfortable Trading Style: Are you more comfortable trading on a crypto exchange or CFD? If you choose a crypto exchange, it means you need to have a crypto wallet to store your assets, with the risk of losing the crypto wallet if you're careless. However, if you choose CFD, you only need to speculate on the price without owning the traded crypto asset.

  • Risk Management: The prices of crypto assets can rise and fall significantly; you must be good at risk management to avoid losses, such as by utilizing stop loss and take profit features.

Day Trading Strategy

There are many trading strategies you can use for your crypto day trading. Here are some strategies and guidelines you can learn and then use in your daily trading activities.

  • Scalping

    #scalping is the most basic strategy for day trading that utilizes asset price movements in minutes or even seconds.

  • Range Trading

    This strategy is carried out by identifying support (lowest price) and resistance (highest price) areas of a crypto asset.


How to Determine Support and Resistance Areas

Some ways to determine the area #supportandresistance are as follows:

  1. Observe Price Charts

    Find points where the price often 'bounces' or 'hits a wall'. Because these points can become support and resistance points.

  2. Trend Line

    Observe the price chart and draw a straight line at the highest points to find resistance, and a line at the lowest points to find support.

  3. Technical Indicators

    Utilize indicators such as moving averages or Fibonacci retracements to help find support and resistance areas.


Trading Strategy Using Support and Resistance Points

  1. Buy at Support Sell at Resistance, the most basic strategy for trading. Buy crypto assets in the support area and sell them in the resistance area.

  2. Breakout and Breakdown, if the market price successfully breaks through the resistance area in a rising manner, it is called a breakout. And usually, the price will continue to soar. Here you can take the opportunity to buy. Conversely, if the market price continues to drop past support, it is called a breakdown, and usually, the price will plummet, and you can take advantage of this moment to sell immediately.


Risk Management for Trading Using Support and Resistance

To avoid significant losses, always utilize stop loss. Set stop loss below support and above resistance. This serves as an 'emergency brake' when the asset price does not align with predictions.

Fundamental Analysis

Monitor news and market sentiment regarding cryptocurrency or anything that can affect cryptocurrency prices. Such as news about wars, future projects, and so on.

Arbitrage

#Arbitrage is Buying crypto on one exchange at a low price and then selling it on another exchange at a high price. The price difference will then become your profit. For example, the price #BNB or $SOL on exchange A is $50, and on Binance, it's $55. So we can buy the coin on exchange A and send it to Binance to sell, thus we can get a profit of $5 per coin (minus gas fees).

Tips for Day Trading Crypto

Do not day trade based on intuition or mood. Instead, pay attention to the following day trading tips:

  1. Choose Crypto with High Volatility: Look for crypto whose prices frequently experience movements such as Bitcoin, Ethereum, or trending De-Fi tokens.

  2. Utilize Technical Analysis: Learn how to read crypto price movement charts. You can also take advantage of indicators that can help you better predict crypto prices. To learn, you can utilize online tutorials or even attend classes from professional traders.

  3. Use Proven Strategies: There are many crypto trading strategies, and you can choose one that you think is most suitable and aligns with your trading style.

  4. Manage Capital Wisely: Never use money that you cannot afford to risk for trading. Only use cold money, and it is better not to go all-in so that you can remain calm and trade more comfortably.

  5. Set Stop Loss: Always use a stop loss when trading to avoid significant losses. This is also very important for maintaining trading psychology.

  6. Discipline: Create a trading plan and do not be greedy. Take profits in moderation and do it consistently.

  7. Patience: Never assume that crypto will make you rich quickly. Everything still requires a process and consistency.

Important to Note

There are several important things you need to pay attention to when you decide to dive into the world of crypto trading.

  1. Do not rush, especially FOMO: Keep studying the basic trading knowledge, do not just FOMO or follow the crowd.

  2. Use Small Capital: It is advisable to use capital according to your financial capability. Do not let trading in hopes of becoming rich quickly lead you to poverty due to poor trading capital management.

  3. Don't Be Easily Deceived: In the trading world, including crypto, there are many scammers and fake news circulating. It is advisable to remain cautious and vigilant and not to be easily tempted by enticing promises of large profits.

In essence, Crypto Day Trading can indeed provide multiple profits to its traders. However, it must still be done carefully and with full preparation and strategy. So, how about it? Are you interested in starting your day trading?

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