If you are new to cryptocurrencies or simply find the trading platforms too complicated to use then you may find this simple trading strategy really easy to use.
note – This is not advice this is simply an easy way to get into trading and like with any investment you may lose some/all of your initial investment.
The screenshots show the huge price fluctuations in Bitcoin just over the last month but cryptocurrencies always have been extremely volatile, this is not a bad thing though. The advantage of Coinbase is that you can buy Bitcoins and sell them into a GBP wallet on Coinbase.
So the basic trading strategy is in 5 simple steps:
- Buy Bitcoins when you feel the price is low
- Hold them as the price rises
- Sell them on Coinbase when you are either happy with the profit or think Bitcoin is about to drop and this will go into your GBP wallet
- When/If the price does fall buy Bitcoins again using the money in your GBP wallet
- Repeat this process and hopefully you see your number of Bitcoins slowly build over time
This strategy can also be used with Ethereum and Litecoin as Coinbase also supports those coins.
A few Tips to remember when using this strategy
- Follow the prices Daily to get used to realising when is a good time to buy and when to sell
- Only you know if you should be buying or selling
- Don’t sell for a loss, although you can panic when prices are dropping Bitcoin and Ethereum always seem to find their way back to even higher prices (or at least they have done so far)
- Remember to sell, It is easy to assume prices are just going to keep increasing when they are but at some point they will dip again and if you are buying to hold long term then this strategy is irrelevant as it should only be used short term.
If you decide you do want to try this strategy then good luck