Are you one of the people out there who is afraid he missed his opportunity when it comes to trading Bitcoin? You heard of Bitcoin, but didn’t act on it, and then they suddenly you started reading about how Bitcoin nearly reached $20,000. You felt like you could have bought Bitcoin when it was trading for just a couple of dollars a coin, but now you feel really priced out of the market.
If that’s you, don’t worry. You may have missed Bitcoin’s big jump, but if you are serious about trading Bitcoin, you still have plenty of opportunities to make serious money. There are two types of people who buy Bitcoin. There are people who buy Bitcoin to hold onto it for the long term. They do that for many reasons, possibly because they think it is a good long-term investment that will appreciate over time, or because they believe that cryptocurrency is the currency of the future, and they want to own that currency so that they can buy things with it.
If you are one of those people, you definitely missed the big jump, but most of those people held on to their Bitcoin, and the price dropped down to around $8,000 today.
Then there are the people who want to be trading Bitcoin. They see it as a trading opportunity that they can use to make money. If that is you, then you are in luck. You still have every opportunity to make money off of Bitcoin. In fact, if you were a trader on those days when Bitcoin skyrocketed, most strategies would have had you sell off your holdings to protect your earnings long before it hit $19,783, and long before it dropped back in value following its rise.
So how can you make money trading Bitcoin?
How to Make Money Trading Bitcoin
As a trader, you can buy portions of Bitcoin. You don’t necessarily have to buy entire Bitcoins. So let’s say you have $1,000 to invest, and you want to start trading Bitcoin. For our trading Bitcoin demonstration, we are going to assume the price of Bitcoin is $8,000. So you perform your technical and fundamental analysis, and based on your analysis, you believe that Bitcoin is about to increase in value.
You can go to your preferred exchange and buy 1/8 (that’s 12.5%) of a Bitcoin. Decide your stop loss and trading points. Your trade will increase or decrease in value by the same percentage as Bitcoin. If Bitcoin increases its value by 10%, to $8,800, your investment will also increase by 10%, to $1,100.
How to make more money Trading Bitcoin
You probably noticed in the example above that Bitcoin increased by $800, but you only earned $100. You do have another trading option, which is to leverage your investment. You can have your broker essentially lend you the $7,000, so that you control a whole Bitcoin. You have invested $1,000, your broker has lent you $7,000, and when Bitcoin grows 10% to $8,800, you first pay the $7,000 back to the broker, leaving you with $1,800, an 80% return on your trading Bitcoin investment.
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