The right combination of investment and trading when trading cryptocurrencies
If you're involved in investing, you've probably experienced the feeling of regret after selling an asset and it continued to rise.
Such situations are especially common when trading cryptocurrencies, as unlike conventional currencies, these assets can grow not just by a few percent, but by several times.
A great example is Ripple. After the coin rose from $0.50 to $1.20, many investors locked in profits by selling. But just a few weeks later, XRP surged and reached $2.90 per coin.
The record growth has made everyone who previously got rid of such a promising asset and sold their existing cryptocurrency regret it.
A strategy for combining investing and trading
an upward trend over the next five years , meaning no matter what price you buy cryptocurrency at today, its price will likely be higher in five years.
But what if you want money now and are upset about losing the opportunity to earn money in the highly volatile cryptocurrency market?
I have long ago defined a win-win strategy for trading cryptocurrencies for myself, which consists of two parts.
The first part is investments
I buy promising cryptocurrencies, primarily coins with real-world applications and a certain level of liquidity. This is how I've purchased Ripple, Stellar , Tron, VeChain, Algorand, Binance Coin, and several other tokens.
These coins are stored in crypto wallets, and I do not plan to sell them in the near future, as I hope for further growth.
But, in order not to regret missed opportunities, I also use trading for current earnings.
Cryptocurrency trading for profit
In addition to crypto wallets, I also have an account with one of the cryptocurrency brokers in order to open transactions through the trading platform.
Of course, you can trade directly on a cryptocurrency exchange, but the MetaTrader not only more familiar but also simpler. Furthermore, MetaTrader offers many more features than online platforms from crypto exchanges.
It is in the trading platform that I open a trade on the above-mentioned cryptocurrencies and Bitcoin if I see the price starting to rise, and after the trend weakens, I close the order with a profit.
There is no scientific explanation for this approach; I just feel better knowing that I have coins that can go up in value even more.
Despite all this, the amount I use for cryptocurrency trading remains the same. I have a total of $10,000 invested in cryptocurrency, with $5,000 being a long-term investment and $5,000 earmarked for trading.
Some might ask, "Why freeze my money?" I could have earned twice as much on short-term trades with $10,000? But I'm essentially losing nothing, as I use leverage , meaning with a $5,000 deposit, I can open trades worth $10,000.
The maximum available leverage is 1:10, but I don't consider myself a risky trader, so I believe that 1:2 leverage is quite sufficient for trading cryptocurrencies, which have extremely high volatility.
This is my approach to cryptocurrency trading, and so far it's yielded pretty good results, but you can use your own approach. Good luck with your trading and investing.
