Top Crypto Day Trading Strategies

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( — June 6, 2022) —

Crypto day trading can be lucrative if you have a solid strategy and trend analysis techniques. You’ll use price isolation, volumes, chart patterns, and other indicators to identify buying and selling opportunities while making sound investment choices. The crypto market has several unique features smart traders can use to increase their gains. Crypto day trading operates 24/7, offering many opportunities and allowing you to trade at any time of the day.

Unlike stock markets which are heavily regulated, crypto day trading has fewer restrictions to navigate than other trading types. Its volatility is very beneficial and lets you exploit big opportunities for profits. With the right crypto day trading techniques, you can significantly increase your earnings. This article outlines the top eight crypto day trading strategies.

  1. Range trading

A trading range occurs when a market consistently moves between two levels or prices for a decisive period. Range trading sees investors going short and long at varying times based on the price position within the range. The range trading principle sees prices hit a support zone and resistance areas, meaning costs don’t respect these areas. Trading rages seem to attract a lot of traders, increasing volatility. Like with other trading types, the right risk management is vital.

Prices can sway around these areas, so you’ll consider using wider stops around them to limit losses as a prudent trader. It’s essential to consider trading range width and distance applied in stop replacement. Learn how to set stop losses on Coinbase to ensure you don’t lose too much of your investment on trade should anything go wrong.

  1.  Scalping

Scalping is a short-term trading technique a trader uses to make regular small profits from minor price movements daily. These small profits can add up to create a significant amount over time. Since scalpers utilize significant liquidity amounts to leverage minor price changes over a short period, the turnaround times are quick. 

Scalping crypto can benefit day traders due to their profitability potential, low risk, and easy automation for bots. To capitalize on high trading volume and generate profits, remain up-to-date with future events and current news that can cause price movements.

  1. Technical analysis

Technical analysis is a technique that predicts a security currency’s possible future price movements depending on the market data. Technical analysis offers day traders the logic to find trading opportunities to earn revenue, allowing them to detect short-lived trends and trading patterns vital for day trading. Using historical trading data (past performance), a technical analyst can use their statistical trading technique in any financial market to evaluate future losses or gains in crypto. Consider using technical analysis indicators to increase your chances of making a profit.

  1. High-frequency trading (HFT)

HFT is algorithmic trading involving vast transaction numbers, high-speed trade performance, and a temporary investment horizon. It utilizes special computers to attain the highest trade execution speeds possible. Since HFT is complex, it’s a tool mainly employed by big institutional investors like hedge funds and investment banks. 

Trading algorithms scan several exchanges and markets, enabling traders to get more opportunities like arbitraging minor price differences for a similar asset traded on various exchanges. High-frequency trading, coupled with large security volumes, helps traders profit from even the slightest price fluctuations.

  1. News and sentiment analysis

The news and sentiment analysis strategy is similar to the technical analysis as it involves predicting. The only difference is that it depends on human actions and reactions, not price trends. Using this technique, day traders can forecast whether demand will fall or rise for some cryptos by assessing different data sources to understand the currency’s social consensus and predict human actions.

These information sources are industry news outlets, social media posts, and mainstream. Some websites track sentiments on the popular cryptos by evaluating Twitter chatter. Many positive tweets regarding crypto could mean the market is booming, while more negative ones could imply that the market might experience a low trajectory.

  1. IFC markets

IFC markets provide various investment options, offering you the alternatives you need to diversify your portfolio. You can trade crypto CFDs on the website using multiple styles, including over 6000 financial instruments, low spreads, instant order execution, and no hidden commissions. As a day trader, you have the liberty to build your financial tools and best strategies for day trading crypto, leveraging the 1:8 advantage and low minimum volume requirements.

CFDs are derivatives that allow day traders to hypothesize cryptocurrency without ownership of the underlying coins, meaning they can go all out if they think the crypto’s value will increase. You can trade cryptos as pairs against standard currencies. In addition, in CFD trading, you don’t need a Bitcoin exchange account or Bitcoin wallet to trade.

  1. Arbitrage

Arbitrage is an excellent strategy for crypto day trading involving buying coins from one exchange and selling them on another at a higher price, making profits. When a crypto pair price, including Bitcoin and a little-known altcoin, differs from one exchange to another, a day trader can benefit by leveraging the price disparity in the two markets. The difference between the purchase and selling price is known as the spread.

While arbitrage isn’t an easy financial mechanism, automating it can ensure stable digital asset prices between various exchanges. It’s a popular technique in crypto day trading as the market isn’t unregulated, implying that most exchanges have decent price differences. Using this strategy requires you to have accounts on exchanges with a considerable difference between prices.

  1. Dollar-cost averaging (DCA)

Considering that finding the right entry or exit time in the cryptocurrency market is almost impossible, dollar-cost averaging is an excellent way to invest in cryptos. DCA means investing a fixed amount at regular intervals. This technique helps traders eliminate the need to time markets and build wealth in the long run. Nonetheless, the DCA’s exit technique can be tricky. It requires a market trend study and an understanding of the market cycle. If you can read technical charts, you can exit at the right time. Consider tracking overbought and oversold regions before investing


Crypto day trading can be a lucrative investment, especially with the right strategy. Consider using any of these crypto trading strategies to make significant profits.