How easy is it to trade Crypto-currencies at Forex market?
How easy is it to trade cryptocurrencies in the Forex market?
A new class of assets has emerged in the global financial system in recent years. It is a cryptocurrency that characterizes the rapid progress of digital technology and opens up vast prospects. However, many governments see the potential for competition with national currencies in cryptocurrencies, which threatens sovereignty. Despite this, cryptocurrencies are increasingly being introduced into the global economy. Many large companies, services and manufacturers of goods are beginning to use Bitcoin and other digital currencies in their calculations. This greatly accelerates the turnover of funds and simplifies international settlements. (Find interesting facts in the article “Interesting about cryptocurrency”).
The market is cryptocurrency
The use of Bitcoin by individuals and entities is constantly expanding. Bitcoin takes on many online services, as well as shops, restaurants, law firms, real estate agencies and other service providers. The capitalization of Bitcoin in dollars is constantly growing. In addition to Bitcoin, about a thousand cryptocurrencies have already been created, but only the etherium and Ripple are close to it in terms of capitalization. The Ripple protocol is already used by banks, payment networks, Santander, UniCredit and UBS.
In addition to the cryptocurrencies mentioned above, the most popular are DASH and Litecoin. But Bitcoin still accounts for more than 40% of the world’s cryptocurrencies. The need to buy, sell and exchange digital currencies has led to the creation of large online exchanges. The first of them was the Mt.gox exchange, founded in 2007. By the time it was closed in 2014, half of all Bitcoin transactions had passed through the exchange. But by this time, there were other successful exchanges such as BTCtrade, BTC-e, Chinese BTCChina and many others. Now you can easily buy any cryptocurrency in the desired quantities. (Read about the Ephirium cryptocurrency in the article “What will happen to Ephirium in 2018?”)
The market of cryptocurrency operates around the clock and on a daily basis without days off, which excludes the concept of a session. Exchange participants can sell, buy and exchange coins at any time. Therefore, the intensity of quotes fluctuation does not depend on the time of day. The course of Bitcoin and other coins on the charts is very volatile, and this is attractive for speculators. A large number of different digital currencies expand opportunities for trading and investment in new technologies.
However, against the background of general development, there are certain risks caused by the essence of digital currencies. Often the price of a cryptocurrency is formed on the basis of speculative demand, although the main price driver is the demand for transactions and volumes of these transactions. Therefore, unpredictable kickbacks can occur if such demand decreases.
Read it too:
- «Cryptocurrencies with huge growth potential in 2018. Part one. Monero, Ripple and Dash.”
- «Cryptocurrencies with huge growth potential in 2018. Part two. NEO, Stellar Lumens, Zcash»
- «How easy is it to invest in Bitcoin on Forex?»
- «What happens to Bitcoin in 2018?“»
- «The future of IOTA: Why does Tangle beat Blockchain Iota’s forecasts for 2018»
- «How to Buy Bitcoin Online. ” Fast. | ” The best 5 ways to do it»
Forex trading in cryptocurrencies
Forex brokers quickly understood the benefits and opportunities provided by cryptocurrencies. Forex traders are not afraid of the risks associated with the volatility of digital currencies and they willingly agree to trade them. More and more brokers provide the opportunity to trade with BTC/USD (Bitcoin to dollar) and other brokers, and also accept bitcoins for deposit replenishment.
Trading with cryptocurrencies on the Forex market is much easier than trading directly on the stock exchange. You don’t need to buy bitcoins to trade, it’s enough to replenish the deposit in any convenient way. CFD trading on cryptocurrencies is also becoming widespread. Binary options brokers include Bitcoin and other digital currencies in their lists of traded assets.
A good example is FXOpen, which opens a cryptographic account and provides the opportunity to trade cryptocurrencies of Bitcoin, Ethereum, Namecoin, Dash, Litecoin, Peercoin and EmerCoin in pairs with the dollar, euro, Japanese yen and Chinese yuan. Cryptocurrency CFDs are available from Alpari and InstaForex brokers. Companies also offer the opportunity to trade in cryptocurrencies:
The advantage of cryptocurrency trading on Forex is that you can earn not only on growth, but also on decline. In addition, forex brokers provide leverage for trading, which is not available on the exchange. However, there are nuances to cryptocurrency trading on the Forex market. The main thing is the global trend upwards. Although there are deep rollbacks, growth continues unabated. During 2017, Bitcoin rose in price from $1,000 to $6,000. Another important factor is the high volatility and wide spreads. This eliminates the possibility of profitable trading on small timeframes. The most optimal variant is medium-term trading on H1 and H4 timeframes.
A very important nuance is the impact of the news. The price of Bitcoin is influenced by news from the digital world, major transactions in that currency and the attitude of the authorities of different countries towards cryptocurrency exchanges. And the effect of the news lasts several days, if not weeks. For example, a significant collapse in the price of Bitcoin led to a ban by the Chinese authorities on initial digital currency placements and restrictions on the operation of cryptocurrency exchanges. (Read more about Bitcoin prospects in the article “What will happen to Bitcoin in 2018?”)
Experienced traders can trade cryptocurrencies quite easily. Their rates are influenced by much less factors than the usual currency pairs, so the technical analysis works well. Using Fibonacci levels, moving averages, candle patterns and other simple methods, it is possible to achieve success.
Crypto CopyFund – a new investment project of eToro
For those who want to invest in the market cryptocurrency, but can not trade independently, eToro has created a new type of financial instrument. This is a copying fund, which provides an opportunity to invest in cryptocurrencies for all comers. eToro is a regulated broker, so investors don’t have to worry about the safety of their funds.
The Crypto CopyFund is a diversified portfolio of assets with a capitalization of at least one billion dollars and a trading volume of 20 million dollars per day. At the moment Bitcoin portfolio includes 67.66%, Efirium – 17.66%, Ripple – 5.24%, Laitcoin – 3.55%, DASH – 3.04% and ETC – 2.85%. The fund’s profitability since the beginning of its operation amounted to 51.23%. The average daily yield is 0.88%.
The opening of positions in the fund is limited by the daily limit. When the daily limit is reached, the fund closes for new investors and opens the next day. Therefore, those who open positions in the first place will be able to invest.
In conclusion, watch the video about the peculiarities of cryptocurrency trading at the Forex market.