Making a Living Day Trading Cryptocurrency

More wikis: All wikis   Bitcoin   Ethereum   Ripple   BCash   Monero   Ontology   Siacoin   Ada   Xem   Verge   Metal   Digibyte   Tron   Lisk   Binance   Electrify   Vechain   Prl  

From MyCryptoWiki
Jump to: navigation, search

How I got into cryptocurrencies[ ]

In 2011 I owned about 3500 Bitcoin which I purchased for $600. Today 3500 BTC is worth over $20 million dollars.

The day I first heard about Bitcoin on Reddit, a friend had also called me to tell me about it. We spent most of our friendship talking about Ayn Rand and programming, so when we heard about a currency that was software and couldn’t be controlled by governments we were very interested. I purchased $600 worth of BTC and my friend and I planned on buying a mining rig.

Being 22 years old in New York City is a financial struggle. I didn’t have enough money to pay rent, and the value of my Bitcoin had dipped to $550. I sold it all and ditched my plans for a mining rig. My financial situation needed to be stabilized before I could invest in assets based on my philosophical beliefs.

Bitcoin stayed in the news over the years. The price went up and down, silk road happened, the legality of it was called into question, exchanges were hacked, and people gained and lost millions of dollars. Through it all, Bitcoin’s price kept rebounding, kept going up.

Bitcoin chart

In 2014, Ethereum hit the scene with the promise of using the blockchain for more than just currencies. You could build decentralized apps on top of Ethereum and even new currencies. In the summer of 2016 I decided to buy ETH at around $9. The day after I purchased Ethereum, something called the DAO hack happened and the price dropped 50%. Unlike in 2011, I didn’t need the money I invested to cover any bills. I watched my Ethereum swing between $4 and $20 for about 8 months. I wondered if I could take advantage of those swings by buying when the price was low, selling when it was high, and buying back in when the price dipped again. Though I didn’t take any action on the thought, the idea lingered in my head.

Ethereum chart

In the same period my company - Bitfountain failed. I now had a bigger problem - I needed a new source of income.

I applied for only one job as a software engineer. It was the kind of job people love - high salary, all the Silicon Valley benefits, friendly team, well funded company, challenging engineering problems. After three rounds of interview they decided not to move forward with me.

I’m not going to lie and say I didn’t want the job anyway. I did want it. But I also feared losing my freedom. I’d be working more for less money and less flexibility than I had while running Bitfountain. Gone would be the days where I could spontaneously book a flight to Bali with no return date. No more of the four hour lunch breaks that I’ve come to cherish over the years.

Going through the interview process made the possibility of losing my freedom real. When they rejected me I didn’t even think about applying for another job. I went into panic mode searching for a way I could make money on my own.

My first month as a cryptocurrency trader[ ]

At this point I still owned Ethereum and the price was still swinging back and forth. Since I needed an income and didn’t want to get a job, it was time to try this trading idea. But I set a strict requirement that if I didn’t earn enough money to pay my rent after a month, I’d quit trading.

I signed up for two exchanges: GDAX and Poloniex. GDAX made sense because it is run by Coinbase, the company where I purchased and held Ethereum. I needed Poloniex as well because there were many cryptocurrencies being traded there (Altcoins - cryptocurrerncies that are not BTC).

Those are the first two exchanges that I used. Now I use others since each exchange has pros and cons.

Day trading[ ]

A live crypto exchange is intimidating at first glance. There are charts and numbers changing at the speed of sight.

I felt overwhelmed but sat through the confusion to try and make sense of what I was looking at. Soon I could see where to place orders to buy and sell, and the charts started to make sense too.

I made $5 on a $100 investment in my first 45 minutes of trading. 5% profit. Bullish!

As the month went on I spent hours trading. I’d buy when the price looked like it was going up, and sell when it looked like it was going down. I didn’t use any technical indicators and I didn’t have a strategy. But it worked. I made enough to pay my rent, so the possibility of making a living from this was validated.

Although I profited, I wasn’t sure if I just had a lucky month. I wanted to formalize my trading knowledge so I could do more than buy low and sell high. There had to be a real strategy to this stuff. I read as many books as I could on trading stocks and foreign exchange markets. I made a lot of mistakes. But eventually I found my rhythm and strategies. I discovered a trading bot that did my work automatically for me.

When do I sell Bitcoin for a Tesla Model X[ ]

After a few months I got better at trading. I was earning more Bitcoin than I needed to cover my monthly expenses. At the end of the month I sold only what I needed, and kept the rest of my net worth in Bitcoin. Around this time in my trading career it was getting to the point where I could have bought a Tesla or put a down payment on a house by selling my Bitcoin.

Let’s say the price of Bitcoin has reached an all time high, as it has done so many times in 2017. Do you sell your Bitcoin to realize your profit in USD?

I am faced with that decision every day now.

Taking the USD I’ve made to buy a home is a solid decision. I can live a nice middle class lifestyle in Los Angeles. Or I can drive a flashy car while I rent a crappy apartment in Los Angeles. It all comes down to your values.

My Advise[ ]

You really need to find your own strategy and not follow others. Read all you can and take what you like and disregard the rest.

Most of the alt-coins (any other coin apart from Bitcoin) go up and then down. If you bought and then sell 200 times a day, you can make money at it. If you already have a Binance, Bittrex or Poloniex account and would like help in micro trading 24/7 then you should use Crypto Profit bot or Profit trailer.

I use Profit Trailer because I can make a fortune on buying and selling alt-coins that stay flat on the exchange markets. Since Profit Trailer allows me to trade all the alt-coins, instead of one at a time, I know that there is another trade in a few seconds.

I have done pretty well in the last 2 years since I started trading actively. Before that, I used to trade more than 3 hours a day buying and selling alt-coins when I had the time.

As a day trader, I have traded in various asset classes including binary options, forex for 5 years before cryptocurrencies so yes I do know a little about what makes it tick. More importantly I’d tell you why crypto is also my favourite to trade.

Why i love trading crypto[ ]

In trading it’s all about volatility. The more price swings up and down, the more opportunities are present for a trader to make money, simply because there are lots more ways in which you can enter a position (i.e. short or buy positions).

Bitcoin (BTC) for instance was trading at around USD 19,000 per BTC just a few months ago and was recently hovering around the USD 7,000 mark. That is an incredible price movement and creates various trading opportunities. As a day trader, that is literally a gold-mine! The best thing is that you don't even have to sit at your computer all day monitoring price. You can simple use the Profit Trailer to do all the work for you while you go about your normal day job. Crypto has changed my life to an extent I don't need a day job again unlike most folks.

Various strategies can be used in day-trading cryptos and that includes scalping, price-swing action and others. This perhaps is what the Profit bot is best at. Just set it on your favorite exchange and forget it. A working knowledge of technical analysis also goes a long way to assist in this.

Another good thing about crypto is that You can start trading with an initial capital outlay of just USD $1,000 or $100. Making up to 10 % to 20 % on that per week consistently is not out of reach. Anything more would mean taking on risks that may render the entire capital at risk. The thing to remember when you start with a limited capital is - risk and money management in trading. It’s critical to stick to a strict regime to preserve the initial capital and grow it at a moderate pace.

I had just recently traded Bitcoin (BTC) trade on April 5, 2018 netting USD 170 in profits in just about an hour of trading (single trade).

As the saying goes, the proof is in the pudding. So yes day-trading cryptocurrencies can be a very profitable business provided you know what you’re doing. Best of luck!

Price Prediction: Coin Price Predictions   future values