Top Cryptocurrency Strategies to make 2022 more Profitable

Top Cryptocurrency Strategies 2022

The term 'cryptocurrency' is now most vibrant among investors and everyday people. One can quickly get advice about investing in various cryptocurrencies from everywhere.

Cryptocurrencies – Bitcoin & Altcoins – were among the best performing digital asset classes in 2021 as more investors entered into the crypto market, trying to figure out the growth from digital investments that have the potential to rise in value in the long run.

This blog will focus on methodologies to bring profit through investing in cryptocurrencies.

So keep an eye on everything here, we are going to discuss impactful 2022 cryptocurrency strategies.

In today’s space, the crypto space is somewhat overwhelming if you are new to it. In this blog, we are going to be fully breaking down a handful of different crypto trading strategies that you can make money with.

We are going to see three different portfolio options with their risk levels.

When you are brand new to the crypto space & want to trade cryptocurrency then do not invest in too many different projects or altcoins; instead, condense your investment to a few quality coins.

To make it easier for you, here we are going to focus on five quality coins and give you a perspective on how much risk is involved in investing in these five coins. Moreover, we are going to add or remove a few different Altcoins.

Here are the options for strategy.

Consider Liquidity before opening a position

Liquidity is an important metric when thinking about how to invest in digital assets. The market moves wildly, so crypto traders need to enter and exit positions quickly. It means there has to be a demand for cryptocurrency trading so investors or traders can buy at the best price and so that when they wish to sell some of their holding assets, they can secure a profit. Stagnating cryptos with great potential is not a good method to secure profit. It keeps you at the mercy of the market.

How to measure Liquidity

1. Look at the previous volume of a crypto asset.
2. Trading volume indicates how many cryptos have been bought & sold, which also indicates the overall interest in the asset. 

Enter using RSI & LuxAlgo trading indicators

The Relative Strength Index (RSI) is a momentum-based oscillator that is used to measure the speed and the change of directional price movements.

This trading strategy requires a timeframe. So the basic idea is this, any time the RSI dips 30 or below, you can enter into a trade. And then you can exit your position before you hit 70. RSI at 70 refers that the coin has been overbought. So, the ultimate goal of this strategy is to exit before it hits 70. One can also exit on 60 if you are following the conservative method. Here, a trader must maintain a goal for 2-35 gain.

It's nearly impossible to predict what the next 24 hours will look like on the charts; it is easier to analyze what happened than to say what's going to happen. So the question is, how does a trader know the right time to enter? And what if he enters too late or too early? That is where the LuxAlgo trading indicator is useful.

There are times when a trader is confused about whether he should enter a trade or not. So, when you use the LuxAlgo indicator, it will display the buy signals turned on or off. The ‘Buy’ signal is typically a confirmation for a trader to enter the trade. For this process, you don't have to stay in front of your computer, watch the charts and try to monitor the price. The idea of trading is to enter when a trader sees an opportunity and exits.

Combining both the process, check for popping up of ‘Buy’ signal and then check for RSI below 30; if these two conditions are fulfilled, then enter into a trade.

If you choose a one-hour time frame, you can aim for 7 to 10%. Whatever cryptocurrency you decide to trade, you can always look back at the previous data to help you figure out the future behavior of that cryptocurrency.

Using Trend tracer & Trend catcher

In short, these two tracers are helpful for micro and macro views. The trend catcher lets us know which direction the market will go before going that way. With the use of both the tracer, one can know the time of its entry or exit from the market.

When you are brand new to the crypto space, do not invest in too many different projects or altcoins; instead, condense your investment to a few quality coins.

Take advantage of volatility

Since crypto is an emerging asset, speculations and community-driven hype surrounding the asset class can often lead to high volatility. While large price movements are perceived as a potential risk, daily volatility is normal & healthy for the digital asset market and is an opportunity to make gains. Remember, smart traders know how to harness volatility.

But to manage your volatility risk effectively, learn to understand what type of trader you are so you can manage the market's price fluctuations. It would be best to pay close attention to what is happening in the market and with the traded asset itself. This means following the news and all related blockchain updates as well as historical charts so that you can identify emerging patterns.

Takeaway

Cryptocurrency is volatile, and one can take advantage of that volatility if he uses all the necessary tools and required research to access that market.

The trader must learn to understand the use of certain technical indicators. These above-mentioned strategies are simple enough to understand, even for a beginner to know ‘How to trade cryptocurrency’!