Cryptocurrency investment strategy 2 – Active trading, ride the wave

This investment strategy is for the risk takers and more advanced investors out there. It requires much better knowledge of trading tools and time and effort spent on following each cryptocurrency / asset that you invest in. It might have more risks, but if executed correctly, can bring good profits.  It is based on positive sentiment in the market. We can compare it to more recent stock examples, like

Facebook – FB. The sentiment since FB entered the market was generally positive. The price in shorter time windows was fluctuating, but overall kept rising. So if you managed your stop losses and take profit limits well, you could always benefit.

We can apply the same strategy to chosen cryptocurrencies – generally, the sentiment is positive – there’s always growing interest, it’s an exciting technology that can improve many areas of finance, business or our daily lives. Therefore the potential upside is great, whilst the downside is limited. It doesn’t actually matter whether we’re seeing a crypto bubble (like the bubble) or not. You can profit during a bubble too, as long as you minimize your exposure to a potential bubble burst.

Crypto-investment strategy number two is as follows:

  • be informed – educate yourself about the best coins / assets to buy – so that you know what the overall sentiment is – and if it changes, you can react fast
  • trade actively – buy on dips, sell if you reach desired profit %. Set yourself profit % target.
  • once the target is reached – don’t close the position, but move the stop loss limit up, so that even if triggered, it’s still in profit
  • first stop loss should be conservative – minimize your risk exposure – don’t set it too low. When you reach certain profit, move stop loss higher.
  • as long as sentiment around the cryptocurrency you’re trading is good, even if some of your trades won’t end in profit, the ones that will can cover the loss ones
  • always refine and improve your strategy and stop loss and take profit percentages – minimize losses and maximize profitable transactions

Which ones should you buy? Check out the suggestions here.


What do you think about this investment strategy? Let us know in the comments!

If this crypto investment strategy isn’t for you, maybe our other strategies here will suit you better.

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