What to choose – currencies or cryptocurrencies? Time to take stock
Stock trading is heavily influenced by the opinion of the majority, that is, the pressure of the crowd.
Moreover, this statement concerns not only the choice of the direction of transactions, but also the choice of the asset for which these transactions will be opened.
Therefore, as soon as cryptocurrency pairs began to be added to the assets available for trading, many traders began to use them in their work.
And this is not surprising, because trading cryptocurrency is fashionable; every day we hear stories about how someone made fabulous money on Bitcoin.
But now time has passed, and we can now sum up how profitable and convenient it is to trade cryptocurrencies, and whether they are truly more profitable than regular currency pairs .
What does the situation look like now?
Spread size – here, classic currency pairs still lead the way. For example, if you open a trade on the most liquid currency pair, EURUSD, you'll pay a spread of $40-50. Meanwhile, a similarly sized trade on Bitcoin would cost $140.
In principle, it's not that much, even if you use scalping strategies that involve frequently opening new positions. And if fees are further reduced, Bitcoin could very well compete with the most popular currency pair.
Volatility is not the least important factor if you're looking to make a quick buck. Cryptocurrency volatility is off the charts.
If you've tried trading traditional currencies and cryptocurrencies, you can appreciate the current situation. On the one hand, the rapid pace of the trend is unusual and frightening, but on the other, you can make money much faster.
It takes some time to adjust to the dynamics of the crypto market.
Automated trading – unfortunately, there is still a relatively limited selection of advisors designed for cryptocurrency trading, and the existing multi-currency advisors are far from always effective.
It's clear that the situation will change over time, but for now we have to make do with manual trading using indicators, fortunately, the latter works quite adequately on cryptocurrencies.
Profitability – this is quite interesting. On the one hand, it can be said that trading cryptocurrencies is much more profitable than other assets.
Even without leverage, you can earn hundreds of percent if you choose the right asset and predict the trend direction . However, the losses will also be quite significant if you open a trade against the trend.
At the same time, by closing losing trades in a timely manner at the first signs of a trend reversal, you can avoid significant losses.
Ultimately, the only significant difference between trading standard currency pairs and cryptocurrency assets is the speed of the trend. Cryptocurrencies have enormous profit potential, but to achieve this, you need to manage your open trades wisely.
