Do you know how to trade Bitcoin?
As of this writing, Bitcoin is the most popular, most well-known, most traded cryptocurrency in the world. It was invented in 2008 though its first use can be traced back to 2009. Like all cryptocurrencies, Bitcoin is basically digital money. You can use it to buy goods, services, or other currencies, similar to physical money. The biggest advantage, however, is that unlike physical money, there’s no central authority controlling cryptocurrencies. If you use cryptocurrencies to buy anything online, nobody out there can track your purchase back to you.
The allure of cryptocurrency has certainly managed to entice more than a few people to invest and trade it. In fact, just a few years back, when Bitcoin was at its peak, the worth of 1 BTC rose to astronomical levels. At one point, it had even reached almost $20,000. Nowadays, that number is at a more stable $9000-$10,000 per 1 BTC.
Because of this, Bitcoin is currently one of the best financial assets that you can invest in. Luckily for you, Binomo allows you to trade Bitcoin on the platform, along with a few other cryptocurrencies. In today’s guide, I’ll teach you step-by-step how to trade Bitcoin on the Binomo platform. Of course, you can also use the same steps and principles to trade other cryptocurrencies on Binomo.
Cryptocurrencies offered on Binomo
Currently, Binomo only offers a few cryptocurrencies to be traded on the platform. You’ve got Bitcoin (BTC), Litecoin (LTC), and Bitcoin Cash (BCH). Bitcoin Cash, despite its name, is actually a new digital currency that was forked from Bitcoin. BCH’s blockchain and specifications differ from BTC so they’re treated as separate currencies.
Getting started with Bitcoin on Binomo
It’s easy to start trading Bitcoin on Binomo.
After logging into the platform, simply click the dropdown list to the right of the Binomo logo. This tab is called the Asset tab. Once you click it, you’ll be presented with the list of options available, including BTC, LTC, and BCH. Since we’re trading BTC in this case, click ‘Bitcoin’.
That’s pretty much it. Once you click on ‘Bitcoin’, the trading chart will update to reflect the Bitcoin chart. You can already start trading now.
Essential terms when trading cryptocurrencies on Binomo
Here are a few essential terms that you need to understand first before trading cryptocurrencies on Binomo, or anywhere, really.
- Spread. Maybe you’ve already seen this word used in Forex options trades since the same concept is applicable to Forex options. Basically, ‘spread’ refers to the difference between the Ask price and the Bid price.
- Multiplier. If you see a word like ‘BTCx100’, the ‘x100’ part is what we call a ‘Multiplier’. This refers to the leverage that is applied to a certain cryptocurrency, like Bitcoin, for instance. BTCx100 means that your trade investment can control Bitcoin that’s over 100x its value. That means if you invest $100 in a BTCx100 trade, then you’re basically investing $100,000 (100 x 100) on regular BTC. This simply makes trading easier for people who have lots of money to invest, since having a multiplier increases their potential earnings. That said, the reverse is also true – having a multiplier also increases your potential losses.
- Change. This is an indicator that tells you whether the value of your chosen cryptocurrency rose or fell in the past 24 hours. If you use this properly, you’ll have a nice idea of where you can enter a buy or sell position.
Is it safe to invest in Bitcoin?
This is the most important question asked by beginner traders.
The thing is, if you’re a short-term trader, it’s probably best to stay away from Bitcoin. Due to its popularity, this cryptocurrency is also known for its high volatility. During its heyday, thousands of people have earned–and lost–hundreds of thousands of dollars on Bitcoin in just a small span of time. Although its value has already stabilized enough these days, it’s still not recommended to beginner traders for obvious reasons.
If you’re a long-term trader though, then feel free to invest a percentage of your portfolio in Bitcoin. Even if you hold your position for just a couple of days, Bitcoin can earn you good money, provided that you know what you’re doing.
Actually, sometimes just holding your position for a few hours can already turn out to be a win for you. Take a look at the chart below, which uses 1-hour intervals to display the sessions. As you can see, if you look at it on an hourly basis, BTC isn’t that volatile. There are even some cases where the price has remained stable for a couple of hours, making it easier to hold your position.
Once the price gets out of these stable periods though, the prices are pretty volatile. You can see that it dropped from around 7250 to around 6950 almost as quickly as it rose from roughly 6850 to 7100.
This means that if you’re really keen on trading Bitcoin, or any other cryptocurrency on Binomo, you should focus more on long term trading rather than short term trading.
Take note that if you do decide to hold your position overnight, Binomo charges you an overnight funding fee. Don’t worry, it’s a really small fee, especially compared to what you may earn doing long-term trades.
Trading Bitcoin on Binomo
As always, I want to remind you that no strategy is 100% effective on any platform. However, based on experience, one way that you can trade Bitcoin on Binomo is by using support and resistance. Remember, BTC prices tend to stay within a range before developing a trend. Such trends usually last a couple of hours to a few days before they change. Due to this tendency, it can be quite easy to determine support and resistance zones while analyzing your charts.
I personally use the 1-hour interval chart to identify any possible support and resistance zones. Once this zone is broken, the developing trend is typically strong, so I always try to take advantage of that.
After figuring out your support and resistance zones, switch to the 15-minute interval trading chart. This gives you a much clearer look for when prices finally break out of the support or resistance.
In our example below, you can see that after the prices start moving closer and closer to the resistance line, the uptrend starts developing rather quickly. It’s usually best to wait until the candles actually close above the resistance, though sometimes you may also be able to predict when it finally happens.
Typically, you need to wait about 1-3 hours. In our example, Bitcoin prices increased from 9480 to 9680 over a 3 hour period. If you managed to enter the correct trade entry point, that’s already a $200 profit right there.
Although we don’t recommend trading cryptocurrencies on Binomo for complete beginners, you don’t need to be an expert in order to trade Bitcoin. Even if you only have a vague idea of what you’re supposed to do, the process is usually easy enough to understand, especially if you have guides like this article.
The only disadvantage I can see when you’re trading Bitcoin is that it sometimes takes a while before an obvious trade develops. This means short term traders who prefer trading in 15-minute intervals may find it a bit tedious. Evidently, if you want to trade Bitcoin, you should have the patience to be able to hold your position for a long time.
Now you know how to trade Bitcoin on Binomo! Before you begin trading with real money, make sure you practice first on your free Binomo practice account.
Good luck on your trading journey with Binomo!
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