The evolution of technology has touched every aspect of people’s lives from communication to finance. Anyone hoping to keep up with the times may be interested with how they can leverage this to their own benefit. If this is you, then you may already be interested in growing your wealth through trading cryptocurrency, a digital currency running on a decentralized system called a blockchain. It’s also known for its volatility which makes it very risky, but crypto’s volatility does come with the potential for higher profits when you buy during a dip, and sell when prices are high.
One of the most popular cryptocurrencies that you may be interested in investing is Ethereum’s Ether. Ethereum is a decentralized blockchain that uses smart contacts and is powered by its token Ether. It allows users to earn through trading, staking, investing in NFTs, and more. While you might compare this to Bitcoin, it’s worth noting that its technology and objectives are completely different. Whereas Bitcoin is simply a cryptocurrency, Ethereum evolves in the applications they develop on the blockchain, making their assets valuable as they are useful.
Given this, you may be interested in trading Ethereum through exchanges such as Swyftx to get started in cryptocurrency or simply diversify your assets. As with any cryptocurrency, it’s crucial that you learn how experienced traders do so to earn and maximize your return on investment (ROI). That being said, consider the following guide on how to trade Ethereum like a pro:
The Basics Of Trading Ethereum
To trade Ethereum like a pro, first, you might benefit from a refresher on how to buy and sell Ethereum. Doing so will involve having a wallet, picking an exchange platform, buying, then selling when you feel that it’s an appropriate time to do so. To further explain, here are the following steps to buying and selling Ethereum:
- Set up your crypto wallet
The first step in investing in Ethereum and most cryptocurrencies is to set up a place in which you can store your cryptocurrency. While some exchanges offer a wallet within their platform, this will discuss how you can set up an external wallet.
First, it’s worth noting that there are several kinds of crypto wallets that you can choose from, notably, software, hardware, and paper wallets. Software wallets include wallets in the form of applications within computers and mobile phones. On the other hand, hardware wallets are devices that can store your crypto and hold your keys offline, making them very secure from hackers. Lastly, paper wallets work by indicating the keys or scannable QR codes that will help you access your crypto wallet.
For these wallets, you may either register and set up an account or purchase one if it’s hardware. In choosing a crypto wallet, it’s important to establish your needs and its security with the various wallets available right now.
- Choose and register to a decentralized crypto exchange platform
The next step would be to choose and register in an exchange platform wherein you can buy and sell your Ethereum. Upon choosing and registering to an exchange platform, you may then choose to connect your crypto wallet to store the Ethereum you’ve bought.
Much like choosing a wallet, you must consider how secure and reliable your chosen exchange is as crypto hacking remains rampant.
- Buying your Ethereum
After having your wallet set and registered to an exchange, it’s time to buy your Ethereum. To do so, you’ll simply have to go over the list of cryptos that the exchange offers and buy some Ethereum depending on how much you’re willing to invest. Note that you must conduct an investment analysis before doing so to understand if it’s the best time to buy some Ether.
- Selling your Ethereum
In the future, you may seek to sell some or all of your Ether to finally begin profiting from trading Ethereum. To sell your crypto, you’ll simply have to return to your exchange, choose Ethereum, and click sell. They’ll then ask you how much you would like to sell. You simply input this and earn money from your crypto investment.
How To Build A Solid Ethereum Trading Strategy
Having established how you can buy and sell Ethereum, it’s worth noting that succeeding in crypto trading isn’t that simple. You must have a solid strategy to ensure that you’re managing the risks and maximizing your profits.
One known strategy to trading Ethereum is by first using Moving Average Convergence Divergence (MACD) and Money Flow Index (MFI) as your indicators. MACD can indicate momentum in the market while MFI is a technical factor that indicates the buying or selling pressure based on the amount of money going into or out of the cryptocurrency.
Taking these factors into consideration, you can employ some strategies such as waiting until the money flow index plummets to below 20. This may indicate that the crypto’s price is being sold below its value. Another would be to wait for the MACD to be above 0, indicating a buildup of a bullish or upward momentum.
Conclusion
Trading cryptocurrencies requires strategy and must be done right to mitigate the risks and maximize your ROI. This includes when you trade Ethereum, a well-established cryptocurrency that remains to be very volatile. Hopefully, with the guide above on how to trade Ethereum like a pro, you’re now better prepared to trade Ethereum and earn from it. Consider applying the ideas presented above and learning how to develop a better trading strategy with Ethereum and other cryptocurrencies that you have in your portfolio.
