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What are the different cryptocurrency trading strategies – The Financial Express

The inclusion of cryptocurrencies’ in financial institutions’ portfolios has grown in recent times, according to Cointelegraph. Despite having the same characteristics as traditional assets, they carry a distinct nature. 

According to the publication, the characteristics of cryptocurrency trading include operating mode, object and trading strategy. Transactions having these elements shows the kind of cryptocurrency trading happening in market. An investor based strategy determine the method to buy and sell digital assets on cryptocurrency narketplaces. 

Based on data by the publication, financial risk linked with cryptocurrency trading can be reduced through proper trading strategies, which can also save a lot of money. Given below are certain cryptocurrency trading strategies for investors to take into account:

Day trading

It refers to entering and exiting a position on the same day of cryptocurrency trading hours. Also known as intraday trading, its motive is to profit from tiny market movements. Trading strategies through technical analysis consumes times, is risky, and is used mainly by advanced traders.

Cryptocurrency futures trading

This strategy refers to a contract agreement between two parties to buy and sell a certain amount of an underlying cryptocurrency at a predetermined future on a predetermined date and time. It gives investors access to a range of cryptocurrencies without the need to own any of them.

Arbitrage trading

Traders believe in arbitrage strategies to earn profits through cryptocurrency trading strategies. Arbitrage refers to the buying of cryptocurrencies in one market and selling them in another. Traders can get profits due to the differential in liquidity and trading volume.

HODL (buy-and-hold)

HODLing is an investment strategy where people buy cryptocurrencies and keep them for an indefinite period of time, which allows investors to profit from long-term value appreciation. Investors can benefit as cryptocurrencies are not subjected to short-term volatility, and the risk of selling low while buying high can be avoided.


Traders using this method exploit market loopholes to gain profit. Scalpers explore the historic trends and volume levels before deciding on entry and exit points within a day, as they prefer highly liquid markets.

Range trading

It refers to an active investment approach in which the investor determines a price range to purchase or sell cryptocurrencies over a short period of time. 

 (With insights from Cointelegraph)

Also read: What are the pros and cons of buying NFTs in 2022

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