Intraday Bitcoin Trading Strategies: The Best Techniques So Far
Intraday trading is just a fancy way to refer to day trading, and for those who may not be aware, both terms refer to the execution of trades within the same day.
Traders should not be mistaken; Intraday trading is not really a strategy as much as it is a general approach to trading Bitcoin & Cryptocurrencies.
Many traders are attracted to this approach thanks to the instant nature of it all and how it eliminates the long waiting times of long-term investing.
Since it’s still quite a hectic way of investment, I’m here to give you my guidelines on how to do it seamlessly.
1. The Principles Of Intraday Trading
Intraday trading is known for positions that last minutes (or hours at most); that’s what identifies a day trader.
Another main objective of day trading is avoiding overnight fees; all intraday trades are closed by the time the day ends, and no positions are held from one day to another - no matter if it’s just an hour.
Day trading tends to rely more on actually watching the charts and technical analysis, which are more prevalent because the strategies involve positions of very short-term nature.
2. Shorter Time Charts
Since you want to stay on top of the most recent movements and identify trends and patterns while they’re forming, you should use shorter time charts.
The best time frames, for me, are the 5-minute and 15-minutes charts, depending on how long I want to hold my positions or how much time I have to constantly check my trades.
I prefer 5-minute charts as they offer more solid data than the 3-minute ones, with less false signals. 15-minute charts are for when I need to be moving all day and I can’t really look at my PC or phone all that often; they’re also great for trading with less stress.
Here are some inside bars traded on the 5-minute chart to illustrate my point:
I opened the trade as soon as I see the inside bars (range) forming right after they were broken downwards. I decided to go short, spotting the bearish trend, and place a trailing S/L in this trade. With my trailing S/L in place, I don’t bother with T/P orders and decide to ride the trend.
The position is then closed as I see that the S/L was met at the reversal, around 6317.00, netting me a profitable 17.62 in return!
3. Know Your Chart and Price Action Patterns
The last important tip for intraday trading is to spot patterns. Both Price Action (Inside Bars, Outside Bars or Pin Bars among the most popular ones) and chart patterns (double tops/bottoms, Head & Shoulders, Cup & Handle, Flags, Pennants/Triangles, and others).
Here we have a classical head and shoulders pattern on our 15-minute chart.
I open my SELL position as I see it breaking the neckline. My S/L is placed at the top of the previous shoulder, as standard, and I place the T/P at the same distance.
Staying true to the intraday trading stereotype, I immediately score 8-point profit, right on the same candle!