How to: trade Crypto

Cryptocurrency has a loyal following, and many see it as the future of payments.

For traders, Cryptocurrency is an almost perfect trading instrument: the spreads are wider than say Euro Dollar or gold, but you get to trade 7 days a week, 24 hours a day. We do however close our price for part of Saturday, but it’s not long.

This means that price can have strong trends and also become an incredible momentum vehicle; when it moves it can last for a sustained duration, so you pay a compelling bid-offer spread for the potential movement, which is attractive for traders.

What is it?

Cryptocurrency CFDs are like any other CFD in that they involve speculation on price movement. In this case speculating whether a cryptocurrency's price will go up or down – without taking ownership of any underlying coins.

Trading Crypto CFDs appeals to a diverse array of traders.

Due to its near 24/7 trading hours and big movement, Cryptocurrency appeals to scalpers, day and swing traders. The ability to get in and out of positions both long and short makes Crypto trading popular to traders of short timeframes and across a range of strategies.

Momentum focused traders can find trading Cryptocurrency appealing, as Cryptocurrency CFDs allow traders to participate in fast-moving markets and strong directional movements, where the daily ranges can be much higher than other comparable instrument classes such as FX or Indices.

Cryptocurrency can trend for sustained periods and will appeal to trend-followers. Over the years, these trends can be higher as FOMO (fear of missing out) kicks in but we’ve also seen sustained and powerful downtrends. For traders who hold short positions, they can also get paid swaps which can be attractive.

Traders need to understand that Cryptocurrency can often be highly volatile and can often see big percentage price changes on any given day - some see this as an attribute, but traders need to respect this movement and factor it into their risk management and position sizing at all times.

Pepperstone’s Edge

With a trading account at Pepperstone, you can place trades on a select range of Cryptocurrencies without the need of a Crypto wallet; while enjoying the flexibility of leverage, and trading the possibilities either long or short. All with the far greater client protections and a strong regulatory environment.

Learn more about trading CFDS

Here at Pepperstone, our customers love the product range along with the low cost to trade and the fact so many markets are open around the clock. Interested? Watch the more videos to learn or speak to our team about whether CFDs are right for you.