Bitcoin Price (BTCUSD)
What Affects Bitcoin Price?
Cryptocurrencies are non-regulated digital currencies that can be traded or used as a medium of exchange. Bitcoin is mostly quoted against the USD, so on an exchange, it’s either buying bitcoin and selling USD or vice versa. If bitcoin prices rise then you can sell it, and when it falls you make a loss.
Bitcoin is arguably one of the most volatile cryptocurrencies and perhaps the most popular. Especially after its unprecedented boom in 2017 followed by its crash in the same month. Its price can fluctuate heavily in just one trading session.
Regulatory changes and bitcoin announcements can drastically affect the cryptocurrency price. After topping $64,000 in April a few of Elon Musk tweets on the cons of mining on the environment, Bitcoin slipped more than 50% from it’s all-time high at $64k to below $30,000. In case you ever wondered why the bitcoin price USD is dropping.
Bitcoin is usually poised for extreme fluctuations on the back of either companies introducing crypto as a form of payment or influencers discussing the crypto or just trading it. It is very market news sensitive and alternatively affects other assets in the financial markets. Its price movements are also heavily reliant on market demand and relative news according to bitcoin’s price history.
Global central banks are one of the most bitcoin movers. As they have opposing views on the crypto, a single signal from a bank on pursuing the crypto or perhaps just warnings of its predictability could take the currency to both extremes; significant highs and lows. In an example of when PayPal and Tesla announced their acceptance of Bitcoin exchanges, the crypto surged directly, this is why the bitcoin price was going up.
Bitcoin price predictions depend on market demand and relative news. And at the time of writing this bitcoin price speculators are betting that it will exceed its all-time high of over 64,000 dollars as it approaches its psychological level of $50,000.
The use of technical analysis and on-chain analysis can also affect bitcoin prices, using charts, historical price patterns and signals can also be a drive for price movements. The on-Chain analysis is similar to the price-earnings ratio, so you can speculate the assets true value compared with the number of transactions made on bitcoin.
In another live example, El Salvador announced that bitcoin is officially legal in the country on June 9th 2021. Perhaps the first country to legalize it in any form of business, without any sort of restrictive measures.
Governments have been trying to put regulatory measures for the unpredictable cryptocurrency by facilitating tax or legality. There have been a number of investigations on online cryptocurrency trading for being associated with laundering and price manipulation.
Lastly, Bitcoin supply is finite and is expected to be exhausted by 2140, which could make bitcoin price rise if demand continues to increase and many investors believe it could top up 90,000 dollars.
How to buy or trade bitcoin? Step by Step Guide
Trading Bitcoin works by taking a position on the cryptocurrency movements through financial derivatives such as contract for difference (CFDs). This means you can trade bitcoin without actually owning the token. To have complete ownership of the cryptocurrency you need to buy it from an online exchange using a digital wallet.
Bitcoin traders speculate its price with CFDs by either going short or long. With ATFX you can trade bitcoin CFDs on our MT4 platform and take advantage of our trading tools that will help you make better investments. You don’t have to worry about a digital wallet since you don’t own the cryptocurrency but only trading a fraction of it.
Online Bitcoin trading using leverage which allows you to make bigger trades without having this amount as your initial amount, so with a small amount of capital you gain exposure to larger positions. Traders use leverage to significantly multiply the returns on their investment, It allows you to manage a big volume on the amount placed.
After deciding on the amount you would like to buy, the next step is to open a live account. And after the initial registration is made, you will make sure to take a speculative decision to either buy or sell with or without leverage. Don’t forget to add stop/loss and profit-taking. Stops and limits are necessary risk management tools that will help you from a slippage.
Bitcoin is known for its immense volatility and de-regulation so the risk to reward ratio here is crucial to weigh risks as you go. The price can easily fluctuate between two extremes. In 2017 bitcoin surged more than 1000% before losing 80% of its value in 2018 and in 2020, Bitcoin was able to skyrocket from $3,908 to $12,470 in just a few months from March 2020 to mid-August.
The next step is placing certain indicators that will help you in speculating the direction such as moving average, relative strength index or Bollinger bands.
You certainly can close your position whether you made a profit or not, And if you decide to sell, the amount remaining in your account depending on the market price will then be converted back to cash. Your designated relationship managers and customer support can guide you through the process.
What is Bitcoin & how does Bitcoin work?
Bitcoin is a decentralized digital currency or virtual currency. Participants in the Bitcoin market can buy or sell crypto tokens through cryptocurrency exchanges or peer to peer. With every transaction recorded in a public list, known as the Blockchain.
Price movements on this cryptocurrency are driven by market demand as it does not operate under a certain regulation. You can send bitcoins from user to user on the bitcoin network or trade it for cash or different assets. Opening an online trading account with ATFX enables you to take positions. It’s commonly abbreviated as “BTC”.
The digital crypto was invented in 2008 by a person or a group of people naming themselves Satoshi Nakamoto and later on released as an open-sourced software.
Fast-forward to 2017, and according to the University of Cambridge, there was up to 6 million users using a cryptocurrency wallet mostly using bitcoin. Other than being another form of investment, people supported the idea of a liberated decentralized currency.
Bitcoins are made through a process called mining. Just like how currencies are made through printing, bitcoins are made by using computational resources. Mining is performed by using very high-powered computers that solve complicated math problems. The problems are very complex and could be described as puzzles.
Bitcoin miners then group transactions together in blocks then adding them to a public record, known as the blockchain. The transactions made can then be verified by network nodes after being recorded in the blockchain. The computers used in this process are extremely high-powered and can process four transactions per second to date, this number futuristically will exceed.
After Miners verify blocks of these transactions by making sure no one can use the same unit twice. They are rewarded through the creation of a new unit of the underlying cryptocurrency.
The process of creating bitcoin can be marked unsafe when it comes to the possibility of duplication. Digital information is unlike a banknote or a bank receipt. Therefore it comes with a good amount of risk that a spender can make copies of their bitcoin and send it to different people.
You can trade bitcoin with leverage, meaning borrowing funds from your broker to increase the size of your trading position. So for $1,000 in your account you can trade 10 times that amount by using leverage making it a $10,000 position. (10:1) and if you decide to trade 100:1 then you would be trading $10,000 for every 100 dollars in your account. However, as much as leverage magnifies profits, it also has the ability to magnify losses.
Bitcoin Trading Strategy for Beginners and Advanced Bitcoin Traders
You can trade bitcoin as if you are trading any trading asset using your favorite trading strategies such as using support and resistance/range trading, day trading, trend trading, moving averages or hedging. Given the immense volatility of this cryptocurrency, it is more suitable for short term trades.
Day trading is the most well-known active trading strategy, which is the buying and selling of securities within the same day. Day traders take advantage of small price moves and price fluctuations in between market open and close, not leaving opened positions overnight. It requires a high degree of discipline to prove profitable especially when it comes to bitcoins price volatility.
Bitcoin day traders use fundamental analysis to take advantage of short-term market moves such as relative cryptocurrency news, regulatory or legality announcements and other kind of news or rumors that implicate the cryptocurrency to immensely moving up or down.
Range trading is another classic technical strategy that is used by bitcoin traders, it’s also known as areas of support and resistance that identifies a range to which an investor buys and sells over a short period of time with resistance being at the top of the cryptocurrency trading range and the bottom of the cryptocurrency range being the support.Trend trading is designed to follow an asset’s direction, when the price moves in one overall direction, either up or down. Through apparent uptrends or downtrends, for instance, a bitcoin trader can take advantage of new highs or new lows in a downtrend. This strategy involves technical analysis to define a trend. Trend traders enter a trade when there is a predetermined trend for analyzing bitcoin.
Why Trade Bitcoin with ATFX?
Trading Open 24/5
Go Long as Well as Short
Trade Bitcoin on Leverage
Start Bitcoin Trading in 3 Simple Steps
Register for an account
Open your account
Complete the Live Trading Account application form. Once we have verified identity, we will set up your account.
Fund your account
Participants in the Bitcoin market can buy or sell crypto tokens through cryptocurrency exchanges or peer to peer, with every transaction recorded in a public list, known as the Blockchain.
Also, trading Bitcoin works by taking a position on the cryptocurrency movements through financial derivatives such as CFDs. This means you can trade bitcoin without actually owning the token. Bitcoin traders speculate its price with CFDs by either going short or long.
You can start by simply opening an account with ATFX.