Secrets of trading with Litecoin crypto currency

Hello, forex traders!
Earlier we already knew how to trade Bitcoin and Ethereum, and today we offer to pay attention to one more popular crypto currency - Litecoin (Лайткоин).

And if all the subtleties and nuances of effective trade with instruments such as EURUSD have long been taken into account by the markets, even the simplest strategies of technical analysis are still practicing with lightcoin trading. In other words, it is an excellent chance for both traders and investors to hunt for hundreds and thousands of percent of profits in a young and dynamically developing market today.

Today, crypto-currencies attract more and more investors and traders around the world. Streams of virtual and unaccountable money are increasing, and the number of companies and organizations accepting payments in Bit- and Litecoin, as well as in some other crypto-currencies is rapidly increasing. Low commission and fast transaction speed, as well as principal accents on the personal confidentiality of holders - provided the crypto currency with the status of revolutionary modern assets, interest in which is growing day by day.

What is Litecoin

The project was founded and implemented by Charlie Lee, a former Google employee, in 2011. Litecoin (LTC) was created on the basis of the Bitcoin program code and is its fork, or branch. It is characterized, first of all, by faster generation of the block (2.5 minutes, which is 4 times faster than Bitcoin), an increased maximum of the number of coins (84 million, which is also 4 times larger) and another hashing algorithm (scrypt, instead of SHA-256). To date, LTC is the world's fourth crypto currency for total market capitalization.

Development, as well as Bitcoin, is based on blocking technology, which implies a distributed data storage system for transactions. It is in this chain of blocks that the translations are confirmed and synchronized, and, as we have already mentioned, much faster than BTC. The transaction is usually completed after generating 6 blocks, or after 15 minutes.

In general, the main difference between Lite- and Bitcoin is a larger volume of coins, a higher transaction speed, and a complicated algorithm for mining. In all other basic relations, LTC is identical to BTC: there is no administrative center, and therefore there is no central regulation of the number of coins in circulation, the issuance process is similar to the Bitcoin issue process, but is complicated, and the currency is exchanged for fi nance money, BTC and analogs - mainly on electronic exchanges, such as Kraken or Bitfinex.

The main problems of the market![daily_picdump_2565_640_02-e1503294561891.jpg()

The size of the block - in connection with which the launch of the wallet takes more and more time. Since the block system is a chain of blocks that stores information about all transactions that have been committed, as the number of transactions increases, the software installed on the user's computer requires the downloading of an increasing amount of data, which can significantly affect the future growth prospects of the currency.

Ambiguous legal status. Many countries calmly perceived the emergence of crypto-currencies in the market, and some see them as an immediate threat to the economy. What measures the political establishment is ready to take to restrict or prevent operations with the crypto currency is certainly unknown. But from a technical point of view, this assumes a significant limitation of the Internet that is usual for us as a whole.

Another problem is related to the fact that the crypto currency is not provided with anything, except, literally speaking, the belief in them. They are not tied to anything and therefore the prospects for growth or depreciation are most often provided by the technical side of the market and are characterized by a relatively small number of fundamental factors. Nevertheless, among the latter one can identify news and rumors that indicate the growth of the general mood of the market (the emergence of new crypto-currencies, public or academic discussions, political criticism, corporate support and high-profile scandals).

The development of market technologies also significantly affects this market. So, in 2014, the median trading course Litecoin on some exchanges, the scrypt algorithm which until then was resistant to ASIC, dropped by more than 50% - just over three months after companies specializing in developing hardware for (such as Alpha Technology) began to produce ASIC products specifically for lightcoin, offering it not only to commercial companies, but also to the private consumer.

Trading Strategies

Crypto currency can be traded around the clock and 7 days a week. This is a trend tool with short consolidations and therefore TC with not too big goals are working well.

What is typical for many crypto currencies, and Litecoin is no exception, the global trend tends to go up as volatility generates more and more powerful levels of correction.

Technical analysis fulfills itself perfectly, and even a normal moving average can serve as an indispensable indicator for analyzing the behavior of quotations.

Scalping is not our option, because of the high spread. Consider deals on H1 and above. Also do not forget that the concept of trading sessions for lightcoin is not applicable and activity can be manifested at any time of the day.

Directly to investors it will be useful to learn, that more recently LTC has left from more than three-year pit. However, for today the agiotage has had time to subside (which is seen below on the monthly chart) and the further fate of the long-term dynamics of the asset remains the subject of heated discussions.

Also, many investors tend to exploit Litecoin as a hedging asset, in the light of its political neutrality. However, it should not be forgotten that crypto-currencies are extremely volatile.

As a result, our strategies are predominantly trend ones with not too big goals. Timeframes from H1 and above, and scalping is not allowed. With long-term investment, it is worth waiting for a correction, after which it will be purchased at the (low) point of view, if the news foreshadows another wave of growth for the crypto-currency market as a whole. For intraday trading, the simplest book strategies - trend and breakout strategies - are suitable. However, try not to miss the latest news and stay abreast of the global trend.

Conclusion

To date, the crypto currency market offers an attractive space for both intraday trading and long-term investment. The simplest trading strategies are well developed here, and the influence of rare fundamental factors on the market remains fairly predictable and irreversible in short prospects. However, beginners should not be deluded by the apparent simplicity of trade, and for the beginning it is recommended to turn to the theories and practice of exploiting volatility. No less should be taken into account the relatively higher overhead costs than when working with traditional forex tools, as well as the need to abstain from scalping, the effective implementation of which will hinder high spreads.

Keep an eye on the news, and stay up to date with current events in the crypto-currency markets, do not forget about stop loss and management maneuvering - and come with you profits!