Steemit Crypto Academy Contest / S3W4 – Cryptocurrency Trading by @temitopef

Good day Steemians, I'm very much happy to be writing another post in the engagement challenge this week. The academy has brought us another good topic to discuss in the contest and that is cryptocurrency trading I will be writing about it, and also invite my friends to participate in it.

Cryptocurrency trading is a very important topic in the crypto space and before I discuss it, I will like to talk about trading generally. Trading is the art of buying and selling of goods or exchange of goods between individuals known as traders, it can be goods for money or goods for goods that are traditionally known as trade by barter which is more popular in the olden days.

So, cryptocurrency trading is the art of buying and selling cryptocurrencies in the crypto space where a cryptocurrency can be sold for fiat currency or bought with fiat currency and it can be bought using other cryptocurrency or sold for another cryptocurrency. People involved in this are called cryptocurrency traders .

Furthermore, cryptocurrency trading can take place in their own marketplaces like cryptocurrency centralized exchanges or decentralized exchanges. Cryptocurrency traders that are committed to trading frequently use centralized exchanges for their trades because there is always sufficient liquidity for their trades and the availability of many pairs that can trade. Also, the fees on these centralized exchanges are cheaper than decentralized exchanges.

So many people have become cryptocurrency traders because it gives them extra income to support their main income while some have taken it as their full-time job. There are many types of trading for these traders, spot trading, leverage trading, contracts trading, grid trading, arbitrage trading, and many others.

We have so many types of traders in the cryptocurrency market with different trading styles like scalpers, day traders, intraday traders, swing traders, investors, and many others. I have my trading styles among the aforementioned but first I will like to explain some of those styles.

I see myself as two types of cryptocurrency trader, Day trader and Investor. As a day trader, I most times enter the market with short term mentality where I mostly use lower time frames for my setup and these trades always end in a day, close in profit or loss sometimes. For my timeframes in day trading, I use 15 minutes to hourly for my setup and this suits my style very well.

On the other hand, I see myself as an investor, I believe in holding some important cryptocurrencies after making my research about them. Most of the cryptocurrencies that I hold are always utility tokens which I am very sure of their continuous use in the crypto space and believe in their future. I hold this type of asset for the long term with the expectation to make huge gains from them.

So, I'm a day trader where my analysis is based on each day to make a profit, in this type of trade I add my take profit levels and stop loss level to book my profit or loss during the day and as an investor, I hold my position for a longer time to make more profits in the markets of some promising cryptos.

Yes, I have tested several time frames to have a better view of any cryptocurrency market not only have I done testing alone but I have used them in my trading before. These time frames are those that suit my style of day trading, they are lower time frames, like 15 minutes, hourly, 2-hourly, 3-hourly, and 4-hourly.

There are cases when I will have to look at the market behavior on these time frames before I choose one that is likely suitable for me on a trading day, this has helped me to be sure of what I am doing to have a positive result from my trades because I would have understood the market better with my choice of time frame, this will reduce my probability of losing money in that market.

15 minutes time frame is my favorite of all of them, this is because it's one of those that guarantee a quick close of my trade in profit and in some cases in little losses. My setup for trade in 15 minutes ensures that my short-term trade aim is realized quickly to book my profit, also I have reasons to quickly learn from the trade especially if I have made any mistake, it will help me to realize it early and not make the same problem in other trades.

Furthermore, I don't have many favorite cryptocurrency pairs, I most times enter a market depending on the behavior of a crypto asset. I often use Binance to see top gainers and check their charts to see if there is an opportunity for me in them, also I check on the losers page to find a short position for myself. Apart from this practice, BTC/USDT and ETH/USDT have been my favorite pairs because they are the top assets that mostly determine the behavior of the market, so I trade them without seeing them as the gainers or losers list.

Furthermore, for the last few months, GMT, NULS, ADA, TRX, LTC, GALA, and DOGE are my most traded cryptocurrencies, these assets are not mostly my favorites, though GMT is one of the favorites, I trade others listed above because I found opportunities in their markets.

Yes, I have been trading regularly over the last few months and I have learned a lot of lessons from all that happened to me in those trades.

I have traded as a day trader and an investor (hodling) over the last few months where I have made trades every day to book profits and invested in some cryptos in long term.

My day trading experience over the last few months is positive as my gains are more than losses and cancel out my losses. The reason for this success is because I always look at the chart very well at different time frames for my short-term setup before choosing anyone, this helped me to manage my positions very well with only small losses if the market goes against me.

Furthermore, to control my trades I always make sure that I set levels for my trades, both take profit and stop loss levels using a good risk to reward ratio (1:1 or 1:2), this has helped me to reduce my loss exposure and if there is a loss in my trades, it's always very little. I book my profit and loss after each trade every day and I learn from my mistakes or keep the method that gives me success.

I entered a long position in the market of GMT this morning when writing for this contest. I noticed on the 15 minutes time frame chart that the market was bearish with the higher period moving average above the lower period moving average but later there was an higher low which is a sign of a reversal, I entered the 10x margin position with 1:1 risk to reward ratio.

I traded with just 1USDT, the trade closed when the price rises to my take profit level and made me $0.13 profit. If I have bigger money to put into it, I would have earned more.

My holding results over the last few months have not been good but I don't care much about it. I have some cryptos I invested in some months ago, the infamous cryptocurrency market crash in May affected most of the cryptos that I am holding and affected my capital badly, they are all at a loss at the time I am writing this post.

The reason I don't care much about it is that I have planned to hold them for nothing less than 1 year and I bought most of them in January 2022. I have the belief that the market will be bullish again and I will be able to regain my capital and make profits on the cryptos that I have invested in.

The instability in the market cost me a little but I have learned some things through this, if I have held from now and the market is bullish, I will take profits on it to at least get back my capital and while I leave the remaining there for the long term purpose.

AI (Artificial intelligence) has been in application in the crypto space to create robots that make gaining insight into the cryptocurrency markets easy and not only for that, some have been developed to create strategies for investors to make profits from different markets which would have been very hard with manual method.

We have a lot of these trading bots that can help traders to create orders in the market and make profits, some of them are 3Commas, Trality, Cryptoshopper, TradeSanta, HaasOnline, Gunbot, Shrimpry, Stoic and many others. These bots can work on three strategies, Arbitrage bots that identify a crypto's price differences across exchanges, buy where it is low, and sell where it is high to make a profit for a trader.

Furthermore, Grid bots create upper and lower cost limits in the market of a cryptocurrency to make several orders as the price is moving and book profits for the trader. Also, Sandwich bots monitor bid by another trader and then increases their bid price hoping that the trader will still want it, and if that works, it will sell to the bidder at the increased price it has manipulated the bidder into.

AI is playing an important role in cryptocurrency trading and many people will adopt its applications sooner. To be honest, I have not used a trading robot before so I can't say much about my experience with it. I will try my best to use the grid trading bot on Binance and maybe I can write about my experience with it in the future.

Cryptocurrency trading allows us to trade our cryptos for other cryptos or fiat currency on crypto exchanges, I use Binance mostly for my trading and it's the most used centralized exchange for cryptocurrency traders in my country. Artificial intelligence has been applied in cryptocurrency trading to make trading more easier and profitable. Thanks to the @crypto-academy for this lovely topic, I will now test one type of trading bots and see for myself how it works. This is where I will be stopping for today.

I invite @patjewell, @yakspeace and @ebunoluwani.