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How to Trade Bitcoin: 10 Tips For Learning About Bitcoin Trading in 2024

How to Trade Bitcoin: 10 Tips For Learning About Bitcoin Trading in 2024

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Coinbase: Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take two mins to learn more.

A list of the Top Brokers to Trade Bitcoins for June 2024:

  1. eToro
  2. Plus500
  3. AvaTrade
  4. IG
  5. Coinbase
  6. Coinrule
  7. Forex Signals
  8. ProfitFarmers

Description of the Best Brokers to Trade Bitcoins for June 2024

1. eToro

Pros

  • 0.1% crypto-crypto conversion fee
  • eToro’s CopyTrader feature allows you to copy the trading decisions of experienced crypto investors
  • Clean, easy-to-use interface
  • Funds can be deposited via bank deposit or wire transfer
  • Low fees are set out clearly, with no hidden charges
  • Offers a free demo account with $100,000 virtual money to practice your trading strategy
  • Offers fractional ETH purchases (you do not have to buy a whole ether)
  • Simple account opening process
  • Trade 24/7, 365 days

Cons

  • $5 withdrawal fee; minimum allowed withdrawal is $30
  • 1% fee when making a purchase
  • To purchase ETH, you will first need to deposit fiat funds into your account

eToro is best known for being a social trading specialist. This Israeli fintech startup has a lot to offer beginner traders.

The simple account setup and great training available with eToro make this a popular choice for those looking for a simple trading platform offering a wide range of trading instruments without too many complicated tools.

eToro has relatively low fees, and the minimum deposit to start is just $200. This platform uses USD as the base currency, so all deposits and withdrawals need to be made in USD, and there is a $5 withdrawal fee.

eToro offers traders the opportunity to not only copy the trading actions of successful traders but also the ability to completely copy their portfolio.

To find out more, read our eToro review.

Visit eToro

76% of eToro retail CFD accounts lose money. Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take two mins to learn more.

2. Plus500

Pros

  • Regulated by the Financial Conduct Authority
  • Over 2,500 significant financial instruments
  • Negative balance protection
  • 24/7 customer support

Cons

  • No API integrations
  • No social copy trading

Another user-friendly entry on our list of the best forex and CFD brokers in the UK is Plus500, providing an easy-to-use and accessible service.

You’ll find over 60 CFD currency pairs with competitive spreads, no commission and available leverage of up to 1:30.

In addition, Plus500 offers three different platforms: Plus500CFD with more than 2800 CFD instruments, Plus500Invest with more than 2700 shares (available in certain countries), and Plus500Futures, a futures platform available in the US only.

Although MetaTrader and cTrader are not available, Plus500’s own platform is very user-friendly. It comes with a range of intuitive risk management features and is available on web and mobile.

Plus500 requires a minimum deposit of £100 if using a credit or debit card, and £500 if using bank transfer.

Plus500 UK Ltd authorized & regulated by the FCA (#509909).

Visit Plus500

80% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. *CFD trading via Plus500’s demo account.

3. AvaTrade

Pros

  • Highly regulated
  • Free deposit and withdrawal
  • No commission
  • Low minimum deposit
  • Social and copy trading

Cons

  • Not available for US clients
  • Inactivity fees

AvaTrade stands out as one of the best brokers for trading Bitcoin due to its comprehensive features, regulatory compliance, and commitment to customer satisfaction.

AvaTrade is a regulated broker with licenses from multiple financial authorities, including the Central Bank of Ireland, the Australian Securities and Investments Commission (ASIC), and the Financial Services Commission (FSC) of the British Virgin Islands. This regulatory oversight ensures that AvaTrade adheres to strict standards of transparency, security, and client protection, instilling trust among traders.

AvaTrade offers a wide range of cryptocurrency products, including Bitcoin, Ethereum, Litecoin, Ripple, and more. Traders can access these cryptocurrencies through various trading instruments, including spot trading, futures contracts, and options, providing ample opportunities to capitalize on price movements in the cryptocurrency market.

AvaTrade provides user-friendly trading platforms that cater to both novice and experienced traders. The platforms offer intuitive interfaces, advanced charting tools, real-time market data, and customizable features, allowing traders to execute their Bitcoin trades efficiently and effectively.

AvaTrade offers a wealth of educational resources to help traders navigate the complexities of Bitcoin trading. These resources include tutorials, webinars, market analysis, and trading guides, designed to enhance traders' knowledge and skills and empower them to make informed trading decisions.

AvaTrade offers excellent customer support to assist traders with any questions or issues they may encounter. Traders can reach AvaTrade's customer support team via live chat, email, or phone, receiving prompt and personalized assistance whenever needed.

AvaTrade offers competitive spreads and transparent fee structures, allowing traders to trade Bitcoin with minimal costs. The platform also provides access to leverage, enabling traders to amplify their trading positions and potentially increase their profits.

Visit AvaTrade

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

4. IG

Pros

  • Highly regulated
  • MetaTrader 4 (MT4)
  • Over 10,000 instruments
  • Available in the UK and US
  • 24/7 customer support

Cons

  • High fees
  • No deposit compensation scheme for US accounts
  • No copy trading
  • Inactivity fees

IG is a great share trading platform for beginners thanks to its user-friendly interface and extensive educational resources.

Pros of IG include a wide range of trading instruments and markets, as well as the ability to access multiple account types and trading platforms. The platform also offers a demo account for beginners to practise trading strategies before investing real money.

However, IG isn’t the cheapest share trading platform, with relatively high trading fees and a minimum deposit requirement of £250 when paying by credit/debit card or PayPal.

In terms of additional fees, IG charges a commission fee for share trading, starting from £8 per trade. There’s also a custody fee of 0.25% per year for holdings of £250 or more.

Overall, IG is a solid choice for beginners looking for a user-friendly platform with extensive educational resources, but investors should be aware of its fees and minimum deposit requirements.

Visit IG

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of IG retail investor accounts lose money when trading spread bets and CFDs with IG. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

5. Coinbase

Pros

  • Stellar customer service
  • Many different funding methods
  • Diverse and ever-changing choice of coin
  • High security system
  • Easy to trade in the US
  • Good for beginners

Cons

  • Not available in all countries
  • Some lesser-known currencies are not supported
  • Lower number of cryptocurrencies accepted than other platforms
  • Higher fees

Best for: Keeping your money safe

Based in California, Coinbase is one of the leading crypto exchanges in the world and a popular choice when buying bitcoin. The company offers both a wallet (which is free) and an exchange for customers.

According to Coinbase, 98% of digital currency is stored offline in vaults and safe deposit boxes. The company also has a 48-hour withdrawal cancellation option in place to protect users from fraudulent activity and offers investors the option of adding a second person’s name to the approval list for added withdrawal security.

Coinbase accepts payment by credit and debit card and charges a flat fee of $3.99 for the privilege – low cost compared to other US and UK exchanges.

The Coinbase debit card supports around nine cryptocurrencies at the time of writing and automatically converts it when you want to use fiat currency.

The card is free in the US but in the UK, a fee of £4.95 applies. There are also other fees applied for things like withdrawing more than the daily limit or using the card abroad.

Make sure you check the related fees before using the card.

Visit Coinbase

Coinbase: Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take two mins to learn more.

6. Coinrule

Pros

  • Works with a range of cryptocurrency exchange platforms
  • Free account option available
  • Various subscription tiers available to suit different needs
  • User-friendly interface

Cons

  • Monthly subscriptions can be expensive
  • No mobile app

Fee: Free with a starter account or from $29.99 per month

With its simple, intuitive design, Coinrule is a good choice for those who are new to trading as well as more advanced traders.

Users don’t need to know any code to set their trading rules.

Coinrule is web-based and works across several cryptocurrencies as well as supporting some of the most widely-used exchanges, such as BitMex and Coinbase Pro.

Visit Coinrule

7. Forex Signals

Successful trading is about more than just signals – and that is what Nick McDonald had in mind when he created Forex Signals in 2012. After discovering that there was no resource for traders to interact, discuss the market, and learn from each other, he decided to build a transparent and inclusive community – and Forex Signals was born.

Now with more than 500,000 members learning from three world class mentors, the Trading Room includes access to educational videos, a chat function with other members and the mentors, trading signals and live streams, trade discussions and access to leading trading tools.

There are three levels of access to the Trading Room. Every level of access includes pro trading video academy, daily live trading sessions and a real time global news stream, analysis of trade sentiment and weekly hot picks.

  • The Apprentice costs £77 and allows access for one month at a time.
  • The Committed costs £39 a month and gives six months access. At this level, you also get some direction from the mentors, as well as a one-on-one with a mentor and exclusive brokerage access.
  • The Professional membership is billed annually, costing £36 per month, and gives members a direct line to mentors and the Trend Surfing Expert Advisor.

Visit Forex Signals

8. ProfitFarmers

Pros

  • Trading signals and strategies
  • Automated trading
  • User-friendly interface
  • Variety of trading pairs
  • Transparency

Cons

  • Reliance on signals
  • Subscription cost

ProfitFarmers – The World's First Free Crypto Trading Co-Pilot

ProfitFarmers is a semi-automatic copy trading platform that produces AI trading signals combined with education and advanced tools to trade better and no trading experience is needed.

They are partnered with Binance.com exchange to buy/sell cryptocurrencies that are paired in BTC, USDT, and BUSD and offer an affiliate program to anyone who wants to promote their product.

Sign up now to use their platform for free and upgrade to their $21 trial offer for 21 days to access all their features!

  • Copy trading signals
  • Advance Features (Trade Guardian, Laddering Mode, Market updates, etc.)
  • Trade Doctor/Session with one of their trading expert
  • Pro trader 5x blueprint (helps you 5x your account)
  • And many more

Visit ProfitFarmers

How to Trade Bitcoin

Bitcoin is the most popular instrument among traders dealing in the cryptocurrency market.

Since its first appearance in 2009 it has experienced exponential growth and, whilst its millionaire-making heyday is thought to have passed, it remains the most commonly traded digital asset and holds significant profit potential for savvy investors.

However, bitcoin trading needs to be approached with caution as significant risks are involved.

As a decentralised market, it is highly speculative. Unlike currencies traded on the foreign exchange markets, where values are influenced by centralised governments, economic activity and global events, the value of bitcoin, and all other cryptocurrencies, is largely determined by supply and demand.

This volatility, along with the security issues that accompany digital assets, makes risk management the single most important factor in a bitcoin trading strategy.

The following bitcoin trading tips have been compiled to help you navigate the cryptocurrency market and mitigate your risk.

Learn Bitcoin Trading with eToro

10 Must-Read Bitcoin Tips

The bitcoin trading tips below are not exhaustive and do not constitute professional investment advice.

Instead, you should use this article as a starting point for your research before utilising one of the many available demo accounts to hone your trading skills before opening a live position.

Step 1. Start out Small

The first of our bitcoin trading tips is to proceed with caution and start with a relatively small investment.

Although it’s an exciting market with a reputation for making the lucky few substantial profits in a short time frame, it is by no means easy to trade bitcoin, and there’s huge risk involved.

Cryptocurrencies, in general, are extremely volatile. Avoid the temptation to go in all guns blazing and, instead, opt for small-stake trades that allow you to get a handle on the market with minimal risk.

Of course, the best of all bitcoin tips is to never trade with more than you can afford to lose.

Step 2. Choose a Secure Wallet

Your bitcoin wallet is a holding pen for your digital assets so it’s important to choose wisely to ensure security and ease of access.

There are multiple options out there, all with their own features and functionality.

For beginner traders, it’s advisable to trade through a reputable broker, such as Coinbase, and use the wallet they provide. If you’re looking to choose your own wallet, though, you’ll need to decide which type is right for you.

Wallets are described as either hot or cold:

  • Hot wallets are connected to the internet and subsequently open to hackers
  • Cold wallets store your assets offline and are generally considered more secure

If you want instant access and are only holding a small amount of bitcoin, a hot wallet should suffice so long as you double-check the reputation of the provider. When holding bitcoin of high value, it’s best to opt for a cold wallet.

Ideally, you would utilise both, keeping a limited amount readily available, with the bulk of your funds kept safely offline.

Step 3. Research the Market

The only sure-fire way to become a successful bitcoin trader is to do your homework and get to know the market.

This is not a straightforward process as many of the practices used to evaluate other financial markets do not apply to bitcoin. It’s a largely speculative field and the effects of global news and events on bitcoin value are very unpredictable.

That said, there are steps you can take to broaden your understanding.

Technical analysis is a key research skill so take the time to practice reading charts and identifying patterns to inform your trading strategies.

You should also be wary of bitcoin tips from other traders. The nature of the market means many people are waiting to profit from the inexperienced. These same people are all too happy to tell you the ‘right time to buy’ in the hope of pumping value so they can exit on a big win. Never take advice on face value and do your due diligence before entering a trade.

Step 4. Decide on a Trading Strategy

Before you even think about opening a position, you should put careful thought into the type of trader you want to be. This will depend largely on the amount of time you have to commit to trading activity and market analysis, and how quickly you’re looking to turn a profit.

Bitcoin traders typically fall into one of four categories:

  • Scalpers are the most active, making multiple trades per day for small profits.
  • Day traders enter and exit the market within 24 hours, taking advantage of short term market movements.
  • Another technique is swing trading, which is based on in-depth technical analysis to capture trends in the market.
  • Finally, you may want to be a passive trader, holding on to your positions with a focus on long term profit.

The benefits of this last approach are discussed in number eight of our bitcoin trading tips.

Step 5. Be Strict With Profit Targets and Stop-Loss Orders

As mentioned, bitcoin is unpredictably volatile, more so than any other financial instrument, so it’s vital to have a plan and stick to it.

Before opening a position, consider what level of profit you would be happy to take from the trade, what losses you can afford to shoulder, and set your target and stop-loss levels right from the start.

This is one of the most important tips, as without a disciplined approach it’s all too easy to expose yourself to potentially devastating movement.

Many beginner traders fall victim to greed, holding on to a position for further profit only to see prices plummet, whilst others optimistically convince themselves that a downward trend will reverse as they fall deeper into the loss zone.

By being strict with your profit targets and stop-loss orders, you can easily avoid this pitfall and minimise risk.

Step 6. Use Leverage With Extreme Caution

Leverage enables you to hold a much higher stake in a trade than the actual capital in your account would otherwise allow. Though this may seem appealing, and can indeed lend itself to significant profit, it can also lead to huge losses if a leveraged trade was to turn against you.

Successful use of leverage is a balancing act between risk and reward and takes practice to master.

For bitcoin beginners, leverage is best used with extreme caution and preferably avoided altogether, at least until you have developed your confidence and trading style.

Only the most experienced traders with sound market knowledge should adopt leverage as part of their bitcoin trading strategy.

Step 7. Diversify With Different Cryptocurrencies

The most important bitcoin trading tips are those that focus on mitigating risk, and diversifying your portfolio is one such tip.

Too many first-time traders develop an obsession with bitcoin’s potential and fail to address its downfalls.

By trading in other cryptocurrencies, you hedge your investments. If one falls in value, your loss may be offset from profit on another.

Diversification can also boost your profits in good market conditions. If you’ve invested wisely, you could well find yourself holding multiple assets of high value.

It’s important not to over dilute your portfolio, though. You still need to assign a worthwhile amount of capital to each trade. Find a balance that reasonably increases your profit potential whilst simultaneously minimising your exposure in any one cryptocurrency.

Step 8. Buy and Hold Bitcoin

As discussed earlier, there are several types of bitcoin trading strategies. The buy and hold approach is a passive strategy where positions are held anywhere from weeks to years.

There are multiple benefits to this:

Buying and holding bitcoin allows you to bypass its short-term volatility. It’s not unusual to see significant movement throughout any given day which can mean your stop loss and take profit targets are easily met, throwing you out of your trade.

This, in turn, can lead to overtrading, and since opening a new position is costly, overtrading can seriously eat into your profits.

As a passive trader, you can keep your position open and potentially earn a good profit with little time commitment, but you still need to have a robust risk-management strategy in place, with carefully considered stop-loss orders.

Step 9. Get a Handle on Your Emotions

Alongside bitcoin trading tips involving risk management and strategy, there are also emotional factors that you need to be aware of, most notably, the fear of missing out (FOMO).

Due to bitcoin’s extreme volatility, it is not unusual to see dramatic price spikes in a very short space of time and it can be tempting to buy-in to an upward trend, fearing you’ll miss out on major profit if you don’t.

However, this goes against the most basic rule of trading – buy low, sell high.

If bitcoin has skyrocketed, it’s likely you’ve already missed the advantageous point of the upward trend, and you’ll end up paying a premium for an asset that will inevitably decrease in value, placing you at a significant loss.

Falling victim to FOMO is one of the main reasons so many beginner traders fail. Be wary and accept that some profitable opportunities just weren’t meant for you.

Step 10. Watch out for Scammers

With no central exchange and little regulation in place, the bitcoin market is, unfortunately, an ideal environment for scammers.

Fake exchanges and wallets are common, as are phishing scams where fraudulent emails direct you to scam sites identical to the platforms you use to capture sensitive data.

Ponzi schemes, which work on a pyramid structure, offer increased returns for investors that recruit other investors and should be avoided at all costs.

Malware is, of course, another issue and without proper security measures around your bitcoin wallet, you leave yourself open to the threat of having your account emptied.

These are just some of the scams to watch out for and, as bitcoin trading is such an open, complicated and relatively new market, new threats pop up regularly.

So, the last of our 10 bitcoin trading tips is to keep your wits about you, be aware of anything untoward and put robust safety measures into action.

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Frequently Asked Questions

Bitcoin trading is the buying and selling of bitcoin, the world's first decentralized digital currency.

Bitcoin trading can be done on cryptocurrency exchanges, where traders can speculate on the price movements of bitcoin.

To learn to trade bitcoin, you can start by understanding the basics of cryptocurrency, blockchain technology and bitcoin itself.

Then, you can research and choose a reputable cryptocurrency exchange, create an account and start practicing trading with small amounts of money.

There are also many online resources, courses and communities that can help you learn more about trading bitcoin.

The best time to trade bitcoin depends on a variety of factors, including market conditions, news events and your own trading strategy.

Some traders prefer to trade during times of high volatility, while others may prefer to trade during more stable market conditions.

Some of the best resources for learning to trade bitcoin include cryptocurrency exchanges, online courses, trading communities and forums, and reputable news sources in the cryptocurrency industry.

There are a variety of trading strategies that can be used for bitcoin trading, including trend following, swing trading, scalping and day trading.

Each strategy has its own strengths and weaknesses, and it is important to choose a strategy that aligns with your own risk tolerance and trading goals.

Choosing a bitcoin trading platform requires considering factors such as security, user interface, fees and available features.

It's recommended to read reviews and compare platforms before making a decision.

Creating a bitcoin trading account typically involves providing personal information, verifying your identity and linking a payment method.

The process may vary depending on the platform.

The minimum investment needed to trade bitcoin depends on the platform and can range from a few dollars to thousands.

It's important to consider your budget and risk tolerance when deciding how much to invest.

Staying updated on bitcoin market news and developments can be done through various sources such as crypto news websites, social media and newsletters. It's important to stay informed to make informed trading decisions.

Bitcoin trading involves certain risks, including high volatility, regulatory uncertainty and the potential for cyber attacks. These risks should be carefully evaluated before making any investment decisions.

Fees associated with bitcoin trading can vary widely between different trading platforms and brokers.

Some may charge transaction fees, deposit and withdrawal fees, or even inactivity fees.

It is important to carefully review the fee structures of different brokers to ensure that you are not paying excessive fees.

For beginners, it is recommended to choose a broker that offers a user-friendly interface, educational resources and a demo account to practice trading. Some popular brokers for beginners include eToro, Coinbase and Binance.

Final Thoughts

Whatever type of bitcoin trading strategy you plan on adopting, you must place security and risk-management measures at its core.

As it is such a volatile market, the potential for both profit and loss is high and first-time traders should never invest more than they can afford to lose.

You should use these bitcoin trading tips alongside other trusted resources to ensure you have a good grasp of the market and its pitfalls, understand how to conduct strategic technical analysis and can compile a detailed risk-management plan to give yourself the best chance of becoming a successful bitcoin trader.

WikiJob does not provide tax, investment or financial services and advice. The information is being presented without consideration of the investment objectives, risk tolerance or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal.

Coinbase: Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take two mins to learn more.


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