Due to their volatile character and potential to jump to incredible levels, cryptocurrencies have emerged as a highly favoured asset in recent years.

These digital currencies allow traders to make significant profits in a short amount of time. Their values tend to alter with time. Although day trading of crypto can be quite good for profits, it is not always that easy. You need sound knowledge about cryptos and how to speculate a coin’s future accurately.

Here’s more about the day trading of cryptos. The blog also lists some of the top day trading cryptos!

What is day trading?

A trader who engages in day trading sells a financial instrument the same day it was purchased. Furthermore, it is a popular practice among crypto beginners and professional traders.

However, day trading can be difficult to master due to the risks involved. Some often frequently compare it to gambling. 

To season the best of deals, you need a thorough understanding of assets, some objectivity, self-discipline, and a little luck on the side. So that being said, it’s simply using volatility to your advantage!

Top crypto day trading strategies

You can use a variety of strategies to day trade cryptos effectively. These will assist you in making better purchasing and selling selections.

• Scalping 

Scalping is a trading method that focuses on benefitting from small price movements and reselling for a quick profit. 

For this technique to work, you’ll need the necessary tools, such as a live feed, a direct-access broker, and the stamina to execute many trades.

• Arbitrage 

Arbitrage is the act of buying an asset in one market and selling it in another at a higher price. 

As a result, traders and investors benefit from the momentary differential in per share cost.

However, it would help keep various factors in mind while trading cryptos. They are explained below for easier understanding. 

Vital factors in determining best day trading cryptos
 

The price fluctuation of cryptocurrencies is determined by three elements: volatility, volume, and current activity of a coin. 

When picking up cryptocurrencies, remember these pointers in mind: 

• Volume 

The volume of a cryptocurrency determines the type of activity taking place in its vicinity. The volume of a cryptocurrency determines if it is bought or sold by a large enough number of people. 

More people purchase when there is a bigger trading volume. The higher volume also improves the accuracy of technical indicators and minimises the likelihood of price spikes or falls.

• Volatility 

The price of a cryptocurrency fluctuates daily. As a result, you can anticipate a profit rate ranging from 10% to 50%—the bigger the volatility, the higher the profit. 

However, investors should be aware that this entails a higher level of risk. A trader who wants to enter the cryptocurrency market should invest in an asset with a high price volatility rate. 

When the asset’s value rises, you’ll be able to earn handsomely.

• Current activity

Crypto is extremely sensitive to the debates that surround it. Therefore, any news, whether positive or negative, can impact the cryptocurrency market’s short-term pricing.

Traders must actively monitor the actions of the cryptocurrency they are trading on all channels to foresee trends.

They must monitor their social media activities, follow its founders, and watch what is said about the coin.
 

Best cryptocurrencies for day trading in India

Underlined below are the most popular cryptocurrencies for day trading: 

• Ethereum (ETC)

Ethereum is the most widely used altcoin nowadays. The demand for Ethereum is never-ending, as seen by its explosive price growth in 2021. 

This is the king of the cryptosphere’s smart contracts and dApps market, with a price increase of 425% in the previous year.

Not only that, Ethereum has a high level of volatility and offers a tremendous possibility to make a lot of money quickly. 

Intriguingly, Ethereum is on the verge of a major transition in 2022, with the ETH-2 protocol being adopted this year. 

The industry’s lack of knowledge about how to react to this adoption is already fuelling Ethereum’s market volatility, all the more incentive to focus on Ethereum.

• Binance Coin (BNB)

Binance Coin was launched by Binance, the world’s biggest cryptocurrency exchange platform, and has since risen to become the market’s third-largest digital coin.

With the dominating presence of Binance in the global crypto market, the Binance coin is a safe investment for day trading. Moreover, it displays more volatility as compared to Ethereum. 

• Lucky Block (BLOCK)

Despite being a new cryptocurrency, Lucky Block has already shown impressive results. The digital asset has increased by almost 1,000% in less than three months to $0.0040.

Lucky Block offers one-of-a-kind value propositions to revolutionise the lottery industry by ensuring gambling fairness. 

Through a random selection technique, blockchain technology claims to boost player winnings.

Furthermore, the v2 upgrade could benefit the Lucky Block ecosystem and price. BLOCK will see more CEX listings with the change, allowing it to onboard more traders.

• Solana (SOL)

Solana is thought to be the world’s fastest blockchain, processing over 50,000 transactions per second (TPS).

Solana’s starting price was $0.77 when initially introduced in March 2020. By September 2021, the value of each coin had risen to $140. 

The ease of use and lower rates for the end user are significant aspects of Solana’s scalability.

India currently lacks a well-established cryptocurrency trading infrastructure which is where cryptocurrency exchanges can help. However, setting a budget and risk while engaging in day trading is best. 

To generate large gains, you must put in a significant amount of money. This is where you must apply objectivity to decide whether the crypto you want to invest in is worthwhile.
 

Frequently Asked Questions

Can you make money by day trading?

Yes, you can make money by day trading if you know the proper strategies. 
 

Which cryptocurrency is good for day trading? 
 

It depends on a variety of circumstances. For example, if you are a strong risk taker, you might want to try volatile cryptocurrencies. 

A good day trading cryptocurrency is also determined by the trade volume and current discussions surrounding it.