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Bitcoin Trading in 2021: Beginner Guide to Learn Everything

Bitcoin trading is the most familiar trading currency among all other cryptocurrencies out there. If you want to know how to trade bitcoin, you should be in the right place. We have dedicated this article to people like you who are keen to learn bitcoin crypto-trading.

Our core covering in this article will be the definition, trading guideline, strategies, bitcoin brokers, and bitcoin wallets. Each one of them is important, and you will find it useful when you will finish reading. We have researched bitcoin to gather information and designed this article for you.

It will surely help you to get the most authentic pieces of information in the below discussion. Without further delay, let’s get on to it and start by knowing what is bitcoin?

What is Bitcoin?

Bitcoin is the first digital currency that came out through a digital encrypted currency system based on cryptography. And it was invented in 2008 by a person called Satoshi Nakamoto. After inventing, in 2009, the coin was announced to be public for trading. The algorithm of blockchain stores all the bitcoin transactions happened, and the price of the currency increased by more than 10000%.

The idea was to eliminate the inflammation of the currencies currently running. You know that the currency system, the powerful entities like governments, can influence the payments and transactions. So, the innovators developed the idea of eliminating those influences on the currency system.

In this currency system, no one can see your payments or transactions you have made throughout the whole time. The system is highly encrypted with multi-level encryption, and it is an open-source system that everyone can see the system. You can use bitcoin to purchase many things now, and the availability is growing at a higher pace.

Bitcoin’s initial price was $0.0008 to $0.08 in 2009, but now it more than $13000 and growing. The trading industry using different crypto coins as their trading instrument to make a profit from the price changes with time. Most of them are increasing in price, so if traders can understand the price movement, they can earn substantial money from bitcoin trading.

Beginners’ Guide for Bitcoin Trading

As bitcoin has much potential profitability, people are trying to start their trading career with bitcoin. However, in the last time, people were interested in investing in the forex market, and still, the trade market is on the run. In this influential growth market where people hear millions’ profitability, many newbies lose their money just for not knowing the market correctly.

We have tried to make the process easier for people that are planning to drive into bitcoin trading. Our experts have analyzed hundreds of step-by-step guides for bitcoin trading, but most of them are not appropriate for newbie traders. So, we thought about building a guideline for you and other new traders so that you can follow our article and get whatever you need to start your trading business right away. Let’s start the step by step process on how to start bitcoin trading.

Step 01: Find a Reputed Exchange Market

It is essential to find the right broker and right exchange market to start your bitcoin trading properly. You may find hundreds of them, but not everyone provides the best services. As a trader, you will invest your hard-earned money, and you do not want to lose them by partnering with a low-quality broker or exchange.

You must affiliate with the best one, and you can read reviews on the internet because many experts are reviewing based on different quality parameters. If needed, then invest more time comparing as many brokers and exchanges as you can and list the best of them. Once you complete making a list, your comparison will be winning, and then you can choose any of them based on the further comparison.

All this research aims to take bitcoin trading services to a safe environment, where you can trade independently without considering your money’s safety. Let’s move on to the next section.

Step 02: Set up Your Bitcoin Wallet

The next best thing you must do is create your crypto wallet on any reputed wallet service provider. Several wallet providers take fees for registering an account on their platform, but others are not charging you anything for just creating an account. Well, we have shared some of the most reputed wallet providers somewhere in the below section. You can go through them and check our comparison to find the best bitcoin wallet for you.

Follow the same steps when you choose the best bitcoin wallet. There is a huge risk available if you cannot manage to pick the right wallet provider. You bitcoins can be lost if you do not consider managing this issue carefully. Remember, all of your bitcoins should be stored in your wallet. It is a digital storage system like your wallet on the behind of your pant.

Step 03: Create an Account with the Exchange Market

You need to create your account on the broker or the exchange market you have chosen before. Be very careful while opening an account and provide the required information as they ask. They might be asking you for several personal information. It would be best to offer them that info because it will be required when you withdraw or invest money.

Step 04: Add Money to Your Account

Now, you need to add money to buy bitcoins for starting trading on the platform. Several service providers are out there who can help you to buy bitcoins directly to your wallet. You need to find a reputed and reliable provider and buy bitcoins. After that, you need to integrate your wallet with the broker or the exchange market for linking money with the trading platform.

Step 05: Start Bitcoin Trading

Many exchanges or brokers allow their users to learn the trade on the practice account, though they call it to demo accounts. You can use their virtual money prepared just for practicing but act like real money to your account. Understand the market behavior because you should understand that money is virtual, but the market is real.

People are often moving in the wrong way, but you should not. You can practice using the demo account as long as you want. Enter the real market where your hard-earned money is at stake. Try to go furthermore as long as you can, and improve yourself like an experienced professional trader.

Pro Tips: Run an In-depth Analysis

Before start trading with real investment, you need to consider checking the past performance of Bitcoin. You should understand that bitcoin and other cryptocurrencies are so volatile. These digital currencies do not behave like traditional currencies.

You can run an in-depth analysis of bitcoin’s behavior from the beginning. Whether you are a novice or an experienced trader trying to enter the bitcoin market, you must understand it’s behavior and movement. Once you learn to identify what moves the price on rising and down, your trading will be like a pro.

You will understand all the indication comes from different indicators. Those indicators will help you intensely while you trade anytime. If you can analyze the facts and make your decision correctly, your trading will be profitable every time.

List of the Best Bitcoin Broker in 2020

Hundreds of brokers are providing crypto trading services to crypto-traders worldwide. However, all of them are not really qualified for ensuring the best services. We have researched more than 69 of these brokers and analyzed their features, trading platforms, leverage, supported trading opportunities. We understand and value your investment and ran a fair comparison to come up with the best brokers. So, here we present the best 07 bitcoin brokers in the world right now. Let’s check them out first.

SL. No Broker Name Pros Cons Min. Investment Our Rating
01 Binance §  Low Trading Fees

§  25% Bonus on BNB Trading

§  Supports Fiat Money Investment

§  Does Not Support US Traders

§  Only European Traders Can Use VISA Card

§  Hacked in 2019

Any 9.7
02 BitMEX §  Holds Highest Available Liquidity on the Market

§  High Leverage Available Compared to Others

§  Friendly Customer Services

§  Does Not Support US Traders

§  In 2019 Affected by Email Leak Affairs

$1 9.5
03 PrimeBit §  WebTrader Platform Available

§  200x Leverage Feature

§  Offers Reliable Trading Engine

§  Offers Only 03 Cryptocurrencies

§  US Traders are Restriction

§  No Live Chat Support Available

Any 9.2
04 BitSeven §  Offers Higher Leverage

§  Available Worldwide Traders

§  User-friendly Interface

§  Does Not Allow Fiat Money Investment

§  No Mobile Application Available

§  Fewer Cryptocurrencies Available

$15 9.0
05 Kraken §  Trusted Crypto Brokerage Services

§  Higher Liquidity Available

§  Cheap/Free Deposit Fee For US & Europe

§  Offers Lower Leverage

§  Expensive Deposits For Certain Traders

$20 8.7
06 bybit §  Offers $60 Bonus

§  24/7 Customer Support Service

§  Anonymity Trading Supported

§  Higher Leverage Available

§  US Traders are Restricted

§  Offers A Few Crytocoins are Supported

Any 8.5
07 BITFINEX §  Offers Unlimited Withdrawal

§  Higher Leverage Available at Different Derivatives

§  Anonymous Trading Available

§  Offers Dedicated and Interactive Mobile Application

§  Required Verification Process

§  Lost Volume Since 2016

§  Got Hacked in 2016

$20 8.0

List of the Best Bitcoin Wallet in 2020

Bitcoin wallets are those agencies that provide you a dedicated account to receive or send bitcoins. These wallets will give you two access one is a private key to access the account, and the other one is the public key. And you can share the public key with anyone who needs to send you money through it. Check the below table for checking the best performing Bitcoin Wallets.

SL. No Wallet Name Pros Cons Account Charge Our Rating
01 Coinbase §  Reputed and Experienced Exchange

§  Great User Experience

§  Most Secured System

§  High Transaction Fees

§  Downtime Occurred in the Past

None 9.5
02 Ledger §  Safer Offline Storage

§  Supports Many Cryptocurrencies

§  Different Version Available

§  Complicated Setup Process

§  Not Incorporated with any Exchange

$59 & More 9.3
03 Trezor §  Most Secured Offline Storage Facility

§  Supports Many Cryptocurrencies

§  User Friendly User Interface

§  A Bit Complicated Setup Process for non-techie People

§  Low Fees Provide Fewer Features

$55 & More 8.9
04 SoFi §  Comfortable User Interface

§  Multipurpose Serving Platform

§  Offers Many Free Financial Tools

§  Does Not Provide Enough Currencies None 8.7
05 Edge §  Great Mobile User Interface

§  Secured with 02-Factor Authentication System

§  Supports more than 30 Popular Crypto Currencies

§  No Desktop or Web Platform None 8.5
06 Exodus §  Responsive Designs

§  Users Can Integrate with Trezor

§  Comfortable User-experience

§  High Transaction Fees (often)

§  Lacks 02-Factor Authentication System

None 8.3
07 Robinhood §  Comfortable User Experience

§  Offers Zero Transaction Fees

§  Desktop & Mobile Version Available

§  Offers Limited No. of Currencies

§  Occurred Downtime in the Past

None 8.0

Bitcoin Trading Strategies

Nowadays, information is playing as the game-changer in any market. If you do not have accurate information on the industry you are in, you will not get success for sure. Likewise, bitcoin trading has several trading strategies that you must follow to get successful trading experience in the industry.

The bitcoin strategists have developed four strategies, but surprisingly, experienced traders use those with their preferences. However, our bitcoin experts at FX Trading Master have enough knowledge to explain those strategies in a way that everyone can follow. Let’s check them out first,

  • HODLing
  • Hedging
  • Trend Trading
  • Breakout Trading

We will discuss these four bitcoin trading approaches for you in the below section. It will be best if you can understand these strategies. If you want to be successful in bitcoin trading, then restructure any of these bitcoin trading approaches. We have tried to explain the basic and honest recommendations for you. Let’s start the discussion on those crypto trading approaches.

HODLing Strategy

Experienced traders often use the hodling strategy. The strategy indicates that when you observe the price movement and decide to hold the position for a longer period than usual. Well, the name hodling is a spelling mistake that a trader quoted on a popular bitcoin forum called BitcoinTalk.org. However, users took the word interesting and started using the word as one of the most complicated Bitcoin trading approaches.

Using the Hodling strategy while trading is not a simple move that you can take with or without a bit of understanding. You must be going through all of the past movements and behaviors. Compare them with the present to decide something like that. If there were any incidents in bitcoin price changing, then take an idea from it, and collect the market condition at that time to enrich your knowledge right now.

Risk Management

Once you understand the situation and find it profitable, you can go for the hodling strategy. Experts are recommending these because hodling is not just holding your position for a couple of weeks only. It can be more than a year or more than 05 years to benefit from the hodling strategy. Try to follow the guideline, and if you agree, only then enter hodling bitcoin trading.

Hedging Strategy

Hedging is all about predicting the price of bitcoin. You know that the bitcoin market is always being volatile in terms of price ups and downs. You can lose your money at once. However, traders are hedging their position to minimize the probability of loss.

Suppose you are hedging when you predict that the price will go down, and you can purchase it at a lower rate. It will profit from the price decrease, but if the price goes up, you might lose. To minimize probability, traders often use both short (sell) and long (buy) positions.

If you buy 02 shorts and 01 long positions in this strategy, then the probability of loss can be avoided. You will buy the position at a fixed price at the current time and get an opportunity to choose either one based on the market.

If the market moves up, then you can buy at your price decided earlier. It means you are purchasing at a lower price than the market because you are hedging your position. However, when the market moves up, then you need to disown the sell the buy position.

On the other hand, if the price goes down, then do not need to worry, and you can sell at the price you decided before, which is higher than the current. This time, you will disown the buy position, meaning it will be a loss.

However, the loss will not affect your profit because you have used the strategy of holding both positions. Whether the price moves up or down, you will get profit from either one. Hedging’s benefit is that your loss will not be more than the amount you initially invested in purchasing.

Risk Management

This particular strategy’s only complication is understanding the market condition and identifying when you should hold your hedging position. It is why most people do not enter this strategy. Experts are recommending to avoid it if you do not have enough understanding of the market movement.

Trend trading Approach

Trend trading goes with the price movement higher high or lower low. The trend can be in any direction based on market behavior. Another thing to remember is that the price movement must be consistent in the respective line in trend trading.

This particular strategy is suitable for those who are patient enough to hold their position for the timeframe to reach the final point where the trend changes its direction. It can be hours, days, months, even sometimes years for that matter to be perfect.

Most essentially remember understanding the market’s momentum or any news event that chan infiltrates bitcoin’s price. You must be updated with information and facts that can influence the price of bitcoin at any time.

The Strategy of Breakout Trading

The volatile nature of bitcoin makes the price breakout to sudden rise sometime at some point. Smart traders pick the point where the price starts breaking out and ride the entire path with the trend and profit from it—the strategy of breakout trading known as those breakout points.

If you want to use the strategy, you must analyze and track every step the coin’s price passes through. It will help you get an indication of the possibility of where it could start a breakout.

Why Do People Buy Bitcoin?

People are always searching for freedom on financial transactions in different terms. However, in our traditional currency system, freedom is not possible where crypto technology offers the same thing as a very sophisticated system. Not only that, there will be no middleman like banks when you make transactions.

You will be given an encrypted wallet that no one can track but the system. You can share your wallet address whomever you want without revealing your identity or knowing their identity. Here are some reasons that will help you understand it better,

  • Bitcoin offers the most secure financial system on earth
  • Transaction Costs are lower than traditional
  • No need to revealing identification for making a transaction
  • A limited supply of currency makes more human than the current currency system
  • No mediator involved like banks, or financial authorities
  • Our existing currency system has failed to serve humans, whereas crypto brings everything in-line.
  • People are investing in this currency system to make a profit and make a living as well.

Finishing Words: Bitcoin Trading Guideline

At the end of our discussion on bitcoin trading, we hope now you understand how to trade, including how the market works, why it is essential, etc. We have tried to help you enrich your knowledge with advanced resources about bitcoin.

We have presented a complete, actionable guideline that you can follow step by step and start trading. We have answered several crucial questions throughout our article and dedicated a section for answering further queries. We have shared different strategies that you need if you want to trade bitcoin.

If you feel there’s something we should include in this article, please comment us below. We will have it in the next update. Our goal is to provide the best guideline and show you the right way to trading bitcoin.

FAQ: Learn Bitcoin Trading

The popularity of bitcoin is growing day by day, and people are getting fascinated to trade or invest in the bitcoin industry. They are asking different things on different forums, social platforms. Additionally, we are also getting many emails containing queries about bitcoin.

Instead of responding to all of those queries, we have designed a sophisticated and dedicated QnA section below. If you can go through our FAQ section correctly, you will get your solution. Let’s check them out.

Is bitcoin safe to use?

Well, the world is not yet entirely approved the use of bitcoin, including other cryptocurrencies. Only a few developed countries, including the USA, Canada, the UK, and Japan, recognize this particular currency and use it.

It would help if you also understood that not many commodities you can buy using bitcoins. However, some car sellers are allowing people to purchase their dream car using bitcoin or other cryptocurrencies.

Please use the bitcoin to purchase anything on only authorized and allowed products or commodities. Otherwise, you may face legal issues, and some of the laws can lead you to severe punishment. Make sure you are aware of these consequences.

Which is the best bitcoin wallet?

Well, the quality of a bitcoin depends on their system’s security, including the user interface. Remember that the user interface is more important than people think because you will not like it if you cannot comfortably use it.

Most of the time, crypto-traders pick the wrong wallet just because they offer services at a lower price. They ignore the significance of the credibility and experience in the cryptocurrency industry.

Consider the security over the price because it is more important to keep your money safe on any platform. Perhaps, you can check our take on the best bitcoin wallet in the above.

How to be the best bitcoin trader?

Bitcoin traders have made process in the most sophisticated trading system compared to the traditional trading industry. Most people are getting interested in investing in cryptocurrencies, especially in bitcoin. However, if you want to be the best bitcoin trader, you must follow a few things while trading.

  • Start learning to understand crypto markets’ behavior to identify their movements
  • Try to analyze strategies of the market winners and get idea from those
  • Open a free demo account and start practicing using virtual money
  • Try to keep everything you find while practicing noted in written
  • Analyze your notes and try to understand them
  • Develop your own strategy based on your practice experience
  • Make the small investment, and have patience while trading
  • Go slow and steady, you will be successful

Is trading Bitcoin safe?

From the beginning of Bitcoin’s creation, it acquired peoples’ trust from a decentralized financial exchange system. The cryptographic currency system has the most sophisticated and advanced technology for storing transaction data. If you want to try a finance system that no one can affect, bitcoin and most other cryptocurrencies are perfect.

However, there are several rumors about bitcoin transactions’ safety, but all of those allegations are not quite right. If you cannot hold your account’s security, then no security can secure your account. All of those incidents happened due to the lack of proper protocols and a quality exchange company that can reliably manage your investment.

How do I convert Bitcoins to cash?

There are two popular ways of converting bitcoin to cash. The first one is converting bitcoin to money from a bank. It is easy to transfer your bitcoin to your bank account through the wallet provider you use.

Make sure that the wallet offers the most secure channel for withdrawing cash. You can also use ATMs in different locations of the world where withdrawing cash against their bitcoin. Be sure you use your account private keys with extra care.

Does Amazon Accept Bitcoin?

No, Amazon does not accept bitcoin. However, there’s a way of purchasing an Amazon gift card using bitcoin. Several web-based service providers, including eGifter.com, RewardsPay Inc, and Gyft Inc. It is simple to buy gift cards from these platforms, and once you buy them, you can purchase anything from Amazon using gift cards. Other than that, there is no way you can buy something on Amazon using your cryptocurrencies because most countries do not allow them to use for any purchase.

How can I earn bitcoin fast?

The fastest way to earn bitcoin is to invest a significant amount of money to buy bitcoin and start trading. This method will reach out to some of the reputed bitcoin sellers and buy from them. You can buy it online or in person.

On the other hand, you can earn bitcoin for free by contributing your GPU system installed in your computer to the cryptographic blockchain system. You will be working as a potential miner and help the system to make the crypto-transactions safer. This way, you will be earning a commission in bitcoin for your contribution.

How do I cash out Bitcoin at an ATM?

Well, you can withdraw your bitcoin directly from ATM as a cash amount. There are 11,867 ATMs all over the world. All of them allow people to withdraw hand cash by logging into their Bitcoin wallet. However, not all wallet providers are allowing using ATMs for cash withdraw.

Can you get scammed on Bitcoin?

Bitcoin transactions happen through blockchain that uses the highest level of encryptions to make the system safe. Inside the blockchain or cryptographic finance system, there is no way of getting hacked or scammed. However, several cases happened in the last few years because of the less secure exchange or brokers.

Besides these, scammers are trapping crypto traders by offering free giveaways, blackmails, etc. Do not ever fall for those kinds of offers, or do not click any unusual links. If you face anything like that, do not panic and connect with the respective authority or providers who can recover your coins.

How do I start trading with Bitcoin?

At first, you need to understand what influences the price movements. Then develop or select a winning strategy for trading bitcoins. Learn about exposure and decide how you want to take it to bitcoin. Understand short and long trade, and choose any between them to go on. Now you need to decide carefully when you want to what will be your stops and limits.

Now, start trading following the strategy and planning you developed and carefully monitor how your investment is performing. Keep on trading, and choose when you want to close your trade. In the end, pick the profit you made through investment.

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