What Is Spot Trading in Crypto? This is the process of purchasing cryptocurrency at its current price and later selling it at the price of that moment. This later can mean one second, 30-minutes, 1-hour, 3-hours, and so on. It is usually done in spot markets in exchanging crypto. Moreover, this can turn into a profit if you sell them at a much higher price. Lower selling prices will surely mean that you are going to incur a loss.
What is spot trading in crypto?
The crypto is highly volatile thereby these assets can either increase or reduce in value within a few seconds. This can even go up to 500% within the shortest time possible. You need to thoroughly understand the crypto environment as a trader for easier sales and purchases. Through a lot of practice and experience, you can do a better trade and earn more profit.
How to do spot trading
Setting up an account
Here, you need to select your desirable trading platform and come up with an account. The signup process requires you to go through some steps and following the instructions keeps this entire process as smooth as possible. Different trading platforms feature different rules to attract different users. Before you can set up your profile, you need to familiarize yourself with the rules, trading fees, terms and conditions, and many more. After completing KYC, you are always good to go.
Figuring out the exchange platform
Take your time to get to know the functionalities of the trading platform you are going to use. Do some practice to understand how their system and tools work. Also, you need to get well acquainted with how to put money, how to transfer, the withdrawal process, and many more. You can as well watch some tutorials for better knowledge. This makes the entire process easier and convenient for you.
Loading your account
The next thing you need to do is to load your cryptocurrency into your account. There is a wide range of options whenever you need to load these items. You opt to buy crypto from the available peer-to-peer option within your preferred platform or outside. Moreover, you can use either your credit or debit card which requires you to fill in the information on how you prefer the exchanges to be done.
This process is similar to buying items through an online platform. Some financial institutions do not allow the use of cards on crypto sites. Therefore, you first check with your bank before making any crypto purchases. Another option requires you to send money to someone holding cryptocurrency you want to buy. They can then transfer this cryptocurrency to your wallet. This method is so risky and you need to know the person very well before any transfers.
Studying trade pairs
After loading your crypto wallet, you need to study the trading pairs that you need to buy at the moment. You should ensure that you are well familiarized with their movements and their trucks. Therefore, you can buy crypto, you should have invested heavily in crypto information to avoid any mistakes that can lead to huge losses. This is specifically for beginners to avoid making any losses rather than build up more profits.
Here are a few questions you need to ask yourself before you can buy crypto in spot markets.
- What was the drop in the last 24 hours?
- What was the rise in the last 24 hours?
- How was the rise and fall at the start of 24 hours?
All these will help you in making so many profits. Check how the pair you intend to buy performed in the last 24 hours. This will help to come up with better purchase decisions.
With time these trading pairs would change, therefore you should keen attention to ensure that you trade at the right time. There are very many trading pairs that one can pick in the spot market. You should choose that trend that is gradually rising. This type of trend is called a bullish trend. It should remain steady to avoid any doubts.
A good trading strategy, good market, and good assets will help you reach your target at all costs. Thereafter, these targets will help you to set your selling or be aware of when you need to exit the trade.
This post is not financial advise, only educational purposes.