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Learn to Trade

How to Day Trade Crypto Currency?

By Louis H-P on February 5, 2020

Reading Time: 3 minutes

Is actually rather simple… it’s the same as Forex trading! Fundamentally you are trying to profit from the volatility of an asset class, that trades between two counter parties. But there are particularities to be aware of, with regard how to day trade crypto currency.

The boring parts…

How to day trade crypto currency can still involve central banksCrypto currencies are unregulated. For many within the crypto community this is attractive, but it also brings problems. Last week the Bank of England referred an incident the FCA after some strange movements in GBP before the Monetary Policy Committee made it’s announcement. Although it is unclear if something untoward has happened, just the knowledge that there is some oversight is comforting. Remember trust is important in markets.

Trust is earned not given…

Crypto currencies are littered with stories of money being stolen. So rule number 1 of how to day trade crypto currencies, is to make sure your blockchain provider is safe. Yet it is not completely clear how safe your money is… there is a hint in there! The problem is every time someone invents an amazing new technology, someone else comes along and breaks it. Just ask the code breakers at Bletchley Park, who broke the supposedly unbreakable  Enigma code. You should always remember that cyrpto currencies are unregulated, so there is no-one to protect you from dishonest participants. 

Protect the pennies and the pounds will look after you

how to day trade cryptocurrency means understanding risk & rewardSecondly before thinking of making money, you should focus on not losing any of your capital first. Using risk management techniques such as the risk – reward ratio is key. Using stop losses is a must, especially with an asset class as volatile as crypto currencies. Part of avoiding losses is knowing when to stop. Having a trading plan will help. Many retail traders lose their money because they were not quite sure what their aim was. Typically as a trade starts to become successful, they let it run, only to see their profits wiped out as it unravels and they became too greedy. 

How to day trade crypto currency means knowing your mind!

The above may be a cliche but has belatedly been seen as crucial. Being a math whizz who can process large amounts of information was historically seen as key to trading. Recently, the ability to control one’s emotions and not let them damage your trading has gained increased coverage. You may be reading this article to learn how to day trade cyrpto currency in the hope of picking up money making strategies, but learning about yourself is probably the best lesson we can teach you. 

Crypto currencies are volatile and can easily change in value due to rumour. Large moves can happen with no clear reason. Learning to let go of a bad day, may be the difference between your next trade being a profitable one or another large loss.

The more things change, the more they stay the same…

Although crypto currency is a new asset class, how you trade it is similar to Foreign currency. Many of the strategies used in Forex trading are valid. Why? Because the same people who trade Forex often trade crypto’s, or started off in Forex and migrated to Crypto’s. Clearly some would have started the other way round.

Day trade strategies can take advantage of the inherent volatility of Crypto currencies. An end of day trader will typically focus on end of day trades, but that does not mean that they should ignore the weekly chart or other slower developing strategies.


Like any trader you should always keep an open-mind. This includes considering opinions which may be different from yours but suggest a change is comingThis ensures that you are not caught out by a new development or miss out on an opportunity. Although cryptocurrency trading may appeal to the modernists out there, we would advise a little caution.

We are not taking the ‘no to everything’ approach you typically get from a compliance department, but the ‘yes but’ from a risk manager. As the debate is open and raging on the place of Crypto currencies, we would suggest to use tried and tested techniques to ensure that if it all goes wrong, you do not lose everything including the shirt off your back! 

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Louis H-P

Louis is a portfolio manager and a trader who brings a wealth of experience in private banking to The Lazy Trader. A fundamentalist and a trouble-shooter, Louis makes a firm contribution to the trading team.

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About author

Louis H-P

Louis is a portfolio manager and a trader who brings a wealth of experience in private banking to The Lazy Trader. A fundamentalist and a trouble-shooter, Louis makes a firm contribution to the trading team.

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