What is trade scalping in the Crypto market is a question that many traders wonder about. Scalping is also known as surfing trading in the cryptocurrency market. Cryptocurrencies in general always have a high level of volatility, so surfing trading can generate a lot of profit for investors. So what is the concept of scalping trading? How to make a profit through scalping trading? Let’s find out the detailed answer to Crypto Trading through the article below!
Detailed concept of What is trade scalping.
Concept of What is trade scalping? How to trade scalping effectively in the Crypto market?
What is trade scalping in the Crypto market?
Scalping is a short-term trading strategy that investors use to make small, steady profits from daily price fluctuations. This allows investors to earn a small income that can grow significantly over time. This is a suitable trading method for individual investors due to its flexibility.
On the contrary, funds with too much capital find it difficult to implement this strategy. Because every time the market changes, the price fluctuates a lot. Trading coins in the form of short-term surfing will help you make money faster than investing in coins for a long time. However, this trading method also comes with financial risks. Investors need to make sure to manage their capital well when trading.
Day trading Crypto in the Crypto market
day trading crypto is similar to scalping trading. When using this method, traders will place positions at low prices, wait for fluctuations, and close positions when profitable. Most of these positions will be closed during the day and not left overnight. This is also an advantage of the day trading method. Because investors will not have to worry about losing overnight trading fees.
See more: How to “get rich” thanks to crypto trading for trader
How to trade coin surfing to make a profit?
When using the scalping method, each investor needs to create a personal trading system. This will help investors achieve maximum profits in each trading session. The surfing method is based on real-time technical analysis. Because at this time, investors will have very little time to analyze the basic market. Investors open medium position orders after 5-10 minutes.
The M5 timeframe on the Crypto chart is considered the most suitable for scalping. It works with most strategies and investors can analyze it. This will help investors increase their predictability. To be able to profit from this method, investors must regularly monitor market developments to open and close positions quickly.
What is trade scalping? Effective Crypto scalping trading strategy
After understanding the concept of What is trade scalping, investors need to research trading strategies that are suitable for this method.
How to trade coins with price difference
Arbitrage trading strategies are the difference between when an investor places a buy order and a sell order. They allow investors to open a lower or higher trading position and then close the deal to make a profit. Arbitrage trading strategies will be highly effective when applied to the Crypto market because of its high volatility. However, investors should note that they cannot arbitrage on the same exchange at the same time.
There are two types of spreads, wide spreads and narrow spreads. When a widespread occurs, the market ask price will be higher. And the bid price will be lower than normal. When a narrow spread occurs, the market ask price will be lower. And the bid price will be higher than normal.
What is trade scalping?
When investors trade on margin, they will use third-party funds. Instead of the investor’s personal funds to increase profits in the market. This allows investors to operate with larger amounts of money and thus earn more profits. On the other hand, some investors will invest by participating in margin trading in the Crypto market.
Some Crypto exchanges also support providing margin for participating investors. This can improve the results when participating in the investor’s trading. Because scalping requires investors to have a lot of capital to increase the chance of success. To start margin trading, investors must use an amount equal to a percentage of the initial order. This amount is called margin and is similar to leverage.
What is the best time frame for day scalping trading?
The ideal time frame for executing a scalping strategy should be between 5 and 30 minutes on the chart. The smaller the time frame, the more orders can be executed. Note that it depends entirely on each investor’s scalping strategy.
However, investors should also note that this trading method also has some disadvantages. The first thing to mention is the transaction fee. Scalping trading is when you execute a position order within 5 to 15 minutes. When you close a position order and open another order. This will directly affect the transaction cost and the investor’s profit.
See more: Open an Bybit account – explore the crypto exchange
Notes when trading scalping in the Crypto market
One tool that any investor should know when participating in the Crypto market is crypto backtesting. Investors when using any technical analysis method need to backtest the past. And then study price behavior as well as market trends to draw trading conclusions for the current time.
Another thing to keep in mind when scalping is to keep up with the news. Scalping traders are almost required to spend a lot of time researching the news. This is the only way to make a profit due to the high volatility of the cryptocurrency market. If you can’t spend more time, this method is probably not for you.
Conclude
The above is basic information to help investors answer questions about What is trade scalping. Investors should note that when participating in the Crypto market, investors should only invest in the scalping method with available capital. If you are a new investor, you should only spend a small amount of money to experience the market. Or you can open a demo trading account to better understand how the Crypto market operates. Follow Crypto Trading daily to strengthen your knowledge of the cryptocurrency market.
FAQs
How to minimize risk when scalping?
One simple way for investors to minimize risk when participating in any strategy is to plan in detail.
How to choose the right coin or token for scalping trading?
Investors can choose new Altcoins. These are coins that fluctuate strongly in each trading session.
Why should investors trade demo accounts?
New investors should join a demo account to better understand the market. At the same time, get familiar with how the trading platforms work and how to use them.
