6 Bitcoin Strategies to Earn Profit
Investing in the Bitcoin does not automatically mean that this is going to bring you profits. Bitcoin prices, like those of any other crypto coin, are highly volatile and investors can gain or lose an equal amount. So, no investment in Bitcoins is without its risks. However, there are some strategies that will allow traders to get back higher returns:
- HODLing: This is undoubtedly the most popular and perhaps the safest Bitcoin trading strategy. HODLing as a term was coined in 2013 when a trader misspelled holding as “hodling”. This strategy implies that the trader buys the Bitcoin and holds on to it for a long time in the hope that the prices will eventually rise. But Bitcoin, being volatile, this strategy may not yield expected returns. So, you need to have a risk management plan when you adopt this trading strategy. Using automated trading apps is becoming a popular strategy now; visit https://coincierge.de/bitcoin-up/ to learn more.
- Scalping: This Bitcoin strategy will let you take advantage of minor market movements. So, you enter and exit trades rather quickly, even within an hour. Scalping is done to execute as many minor trades as possible; the idea is not to aim for very high gains in every trade but to achieve a higher win-loss ratio. Unlike other strategies where you may money when you can win some big trades, scalping focuses on winning small trades. This strategy helps you make profits as it is safe and uses small time frames; so, you are free to exit at any time in case something goes wrong. Moreover, you can take a break if you find that you are incurring too many losses back-to-back.
- Breakout Strategy: This Bitcoin strategy is profitable because it involves getting into a trend at the earliest opportunity and wait for the prices to “breakout” from the original range. The main idea is that the market will break and this will trigger high volatility. It is at these times that traders will need to enter the market and ride the trend from beginning to end.
- Trend Following: When you feel that a trend is likely to continue for some time, or if you are unable to forecast when the price direction will reverse, trend following is a safe bet. So, traders using this strategy will move with trend and not the price swings. When the market is favorable, you need to choose long trades but when the market is going down; you should stick to short trades. When you are not confident about market strategies, you can directly rely upon reputed automated trading softwares like bitcoin lifestyle.
- Diversify Investments: You must do some research before using this strategy to maximize your Bitcoin profits. As an investor it is better to have alternative investments; so, you can choose staking tokens and coins as these will generate profits over time. This is like mining, except that instead of buying costly hardware, you invest in assets that you can get rid of easily when you decide to cash these out. You may choose from tokens like DASH, Qtum, NEO, etc.
- Lending: Another easy strategy for making profits is by lending your Bitcoins to people through a lending platform. You earn interest on the amount you loan to others; it works just like any bank deposit. This needs no experience with investments, or trading skills. It is passive income with you earning interest over the years.