How To Day Trade Ethereum? A Detailed Guide!

How To Day Trade Ethereum? A Detailed Guide!

Are you someone who is not sure of what day trading is and how to day trade Ethereum? Well, in this article, let us see how to day trade Ethereum.

Day trading is a short-term and high-risk strategy where day traders buy and sell cryptocurrencies on the same day. It is a collection of strategies used to profit from sudden changes in the price of a currency. A day trader’s objective is to conclude each trading day with holdings that are worth more than they were at the beginning of the day.

To day trade Ethereum. , select an exchange that allows to day trade Ethereum > Connect it to a digital wallet > Analyse the market strategy > Buy Ethereum > Take profit > Close the trade.

Continue reading to understand how to day trade Ethereum and what steps are involved in it.

How To Day Trade Ethereum?

To day trade Ethereum, select an exchange that allows to day trade Ethereum > Connect it to a digital wallet > Analyse the market strategy > Buy Ethereum > Take profit > Close the trade.

In order to day trade, one must be very experienced with the market as it involves high risks. The strategy of day trading involves entering and closing trades on the same day. A day trade is derived from historical marketplaces, which only operate during specific hours of the day. Day traders are not expected to hold any open positions outside of certain times. You can day trade any cryptocurrency. In this article, we will guide you through how to day trade Ethereum, the most popular cryptocurrency.

Note: Returns in day trading are both higher and riskier

Select An Exchange To Day Trade Ethereum

The first step involved in day trading is to select a good cryptocurrency exchange that has day trading and has the cryptocurrency that you want to day trade. Not all exchanges allow day trading, so it is important to analyze which exchange is best suitable to day trade Ethereum. 

What Are The Best Exchanges For Day Trading?

Connect To A Digital Wallet

It is necessary to connect the exchange to a wallet like Trust wallet, Metamask e.t.c as it enables customers to maintain their own private keys and keep their day-traded Ethereum directly on their devices allowing them to send, receive and store Ethereum. It is the safest option when it comes to storing your asset as it works on Decentralized Finance.

Also Read: What Gadgets May be Helpful for Those Engaged in Trading in 2022?

Devise A Strategy To Day Trade Ethereum

The next crucial step is to study the market and devise a strategy by:

  • Analyzing the market trend (Bull or Bear)
  • Select the time frame by choosing 30 minutes/ 1 hour/ 4 hours/ 1 day and analyze further to confirm the market trend
  • The best time frame for day trading are 5mins and 15mins
  • Choose the best day trading indicators such as the Relative strength index (RSI), Exponential Moving average (EMA) as they provide important information on price, trend trade signals, and trend reversal indicators

What Are The Best Indicators For Day Trading?

  • On-balance volume (OBV)
  • Moving average convergence divergence (MACD)
  • Average directional index
  • Aroon oscillator
  • Stochastic Oscillator
  • Accumulation/distribution line

Also Read: How To Sell Dogecoin on Binance & Other Crypto Trading Platforms!

Buy Ethereum At The Right Time

By now, you will be having a clear understanding of the market trend by analyzing the candlestick and you will be all set to day trade Ethereum.  Make sure to own some amount of Ethereum and enter the trade by clicking on the “buy here” button and start trading. Make sure to set up a stop loss as your position will automatically be closed if the losses in your trading account reach the specified threshold.

How To Day Trade Ethereum - Buy Ethereum at right time

Sell Ethereum When You Gain Profit

When the trade happens in your favor, and once you have attained profit from day trading Ethereum, you can close the trade by clicking the “take profit” button. With this, the Ethereum coins are sold and you can get a profit.

By following these steps you can easily day trade Ethereum. Day trading can be done with any cryptocurrency with a high trading volume of at least a few hundred million USD and that has high liquidity. But, it is completely at your own risk as there are high probabilities of losses unless you are an expert who knows every detail regarding day trading and has solid experience.

How To Day Trade Ethereum - Take profit at right time

Also Read: A Quick And Simple Guide To Forex Trading For Beginners

Wrapping Up

Due to the heavy risk involved in this, many crypto traders avoid day trading. However, there are still a few of them who are well-experienced experts with a lot of funds and day trade Ethereum and other coins. We hope this article has given you a clear explanation of how to day trade Ethereum. For more such informative and interesting articles, check out our page at Deasilex.

Frequently Asked Questions 

Q1. How Do I Become A Day Trader With $100?

Ans. Step 1: Find a brokerage first. Your broker must meet certain conditions in order for you to trade profitably with just $100.

Step 2: Choose securities.

Step 3: Determine a strategy.

Step 4: Start trading.

Q2. How Long Does It Take To Learn Day Trading?

Ans. A prospective day trader may need more than 1 to 5 years on average to grasp the basics, but every person is different. In actuality, some people might never have the essential abilities to succeed.

Q3. What Are The Types Of Day Trading Strategies?

Ans. Day trading, high frequency trading, swing trading, technical analysis, news, and sentimental analysis, range trading, scalping, and position trading are some of the trading types.

Q4. Do Indicators Really Work In Trading?

Ans. If a trader grasps the true purpose of an indicator, they are excellent tools. Of course, you may just observe price activity to determine momentum or volatility, but indicators eliminate guesswork and speed up and simplify information processing.

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