How to Trade Crypto-Pairs – Your Guide to Cryptocurrency Trading
The currency markets today are becoming very dynamic, and this makes trading Cryptocurrencies a very exciting way to trade. In order to understand how to Trade Crypto-Pairs, you must first learn how to make educated guesses about the fluctuations of currency pairs.
If you’ve done any trading before, you’ll know that the biggest problem with Forex trading is guessing where the currency pair will end up. This problem is magnified in the case of Cryptocurrencies, because you can’t keep an eye on one from the other; so if you’re trying to figure out whether or not to buy or sell, it can be very difficult.
One way to help you figure out whether or not to Buy or Sell is to use your knowledge of the currency pair to identify where the previous period of volatility was. By making use of a Forex indicator tool, you can use indicators to give you a historical snapshot of the trend.
It’s important to remember that the market of Cryptocurrencies isn’t always the same as the market of Forex; so if you’re trying to figure out whether or not to Buy or Sell, try to make sure you have a basic understanding of what each currency is worth. There are two main ways of valuing the currencies; intrinsic value and the price based on the spot price.
Intrinsic value is the price that you can get for the currency without taking into account the things that might change the price. Price based on spot price refers to the prices that are quoted on the markets.
Using Forex indicators or indicator tools is a very good idea because the price of the currency can be broken down into segments of the price based on market sentiment. For example, if the current trend of the currency is relatively flat, you can use an Intrinsic Value segment to see how much the price of the currency has moved in the last 24 hours.
With the Intrinsic Value segment, you can identify large sections of the price that were under a certain amount of value. If this particular segment is under five dollars, then you know that the market is bearish.
Bearish markets have prices that are extremely low because the market feels that the price of the currency is too low. If you are trying to predict the future direction of the price of the currency, bearish markets can help you identify that trend.
Another way to help you when looking at Cryptocurrency-Pair pairs is to consider the area of influence for the two currencies. You can use this indicator to compare the countries that are trading the two currency.
Looking at an example, if the base pair is EUR/USD and the Crypto-Pair is BTC/USD, then you can see that the trading volume on the Euro is much greater than that on the BTC. If the Crypto-Pair doesn’t move as strongly as the base pair, then the price of the crypto is likely to fall further away from the base pair.
If the Crypto-Pair moves more strongly than the base pair, then the value of the currency will rise, since the price of the base pair increases as the volatility increases. It’s also important to remember that if the Crypto-Pair is too strong, then the price may fall away from the base pair; and vice versa.
These are just some real life examples that you can use to help you understand when to buy or sell the Crypto-Pair that you are trading. In order to Trade Crypto-Pairs well, you must know when to buy and when to sell.