Volatility measures the changes in prices of commodities, stocks and cryptocurrencies over a given period of time. When the market is volatile, it means that prices change rapidly in a short period of time. On the other hand, a non-volatile market is a market in which prices change very slowly or not at all. Without volatility in the market, there is no profit potential. Investors and traders live in volatility. While volatility also increases the risk associated with trading, it can also bring high profits if you trade correctly. In this post, I will show you how to profit from volatility using an auto crypto trading app.
What is market volatility?
Volatility is a risk factor and the opposite of safety. The more volatile the market, the higher the reward. Volatility is the magnitude of movement in the prices of securities over a given period. For example, a 200% move in one day is not uncommon. Since volatility has a direct impact on financial gains, investors and traders choose to stay away from volatile markets. However, markets that are not moving much create a high risk but also provide high rewards. The higher the volatility in a market, the more profit potential there is in trading. Volatility can cause great wealth to be created in the cryptocurrency and forex trading markets. Bitcoin’s price rises and falls by 100% in a single day. That is why some people prefer trading cryptocurrencies to invest in them.
Volatility and the market
When prices of the stock market go down, it is referred to as the slump. But the good thing about it is that it usually goes away in a few days or a week. This means that a long-term investor can hold on to his or her stock and get some profit. The same goes for the price of cryptocurrencies. When the prices of cryptocurrencies go up, it is referred to as a “bull run.” On the other hand, a bear market is when the prices of cryptocurrency fall dramatically. There is no foolproof method to predict when a bull/bear market will start. But if you keep a tight watch on the market, you can increase your profits in a bull market.
Volatility and cryptocurrencies
The cryptocurrency market is considered one of the most volatile markets in the world. Since the beginning of 2017, Bitcoin’s price went from $13,000 to more than $15,000 in just a few weeks, in addition to significant volatility in a few other coins. Cryptocurrency traders have learned to trade within the volatility and capitalize on short-term price movements. Most often, traders use “trade-around” strategies. Let me explain the advantages of using trade-around strategies. Trading with trading-around is very easy. Let’s say you are trading Ethereum and Bitcoin. If you trade around these two currencies, you will gain the same profit as if you trade against Bitcoin and Ethereum at the same time. You can trade cryptocurrencies directly on exchanges such as Binance.
How to profit in a market volatility
Here are the steps you can follow to profit from the fluctuation in the market. 1. Use volatility to your advantage. If you use the ups and downs in the market to your advantage and time your moves, you can make a lot of money. The most effective strategy to profit from volatility is to have a higher level of volatility in your trading than the market and to profit from the volatile market to a certain degree. If the market is up 30% at one moment and down 30% at the next, take advantage of the sudden and unpredictable price drop to buy a stock. Or if the market is up at 10% and down at 5%, have a small profit at the 10% mark and a bigger profit at the 5% mark. 2. Use trend lines to your advantage. We have seen this strategy work many times in the past.
Low Volatile Trading Methods
Volatility requires you to think about the stock market, which means that trading requires you to understand market basics. First, learn the fundamentals of the market: what goes up and down the most, and which sectors and stocks produce profits and are in short supply. Then you need to know the basics of your chosen asset: what does it trade for, what are its pros and cons, what are the risks associated with it. Finally, you need to decide if you want to make a transaction or accumulate some of the market’s assets. One of the most profitable and easy ways of trading is to use low-vol strategies. Here is a brief guide for such trades. The Low-Vol Trading Approach Low-vol investing involves securities that offer low, or negative, volatility.
Technical analysis is an integral part of the trading process. Technical indicators and trade setups are used to place stop-losses and establish entry and exit points. If you are interested in trading cryptocurrencies and altcoins, I will suggest using an auto crypto trading app called Royal Q. With Royal Q in place, you don’t need to be awake to monitor the markets. The app does everything on your behalf. Click here to get started.