Are you thinking about jumping into the world of crypto trading but don’t know where to start? You’re not alone. With the rise of cryptocurrencies, more people than ever are looking to understand how to trade crypto effectively. This guide breaks down everything you need to know before placing your first trade—plus tips, strategies, and common pitfalls to avoid.
Trading vs. Investing in Crypto: What’s the Difference?
Before you start trading crypto, it's essential to understand the difference between investing and trading.
- Investing in crypto usually means buying and holding cryptocurrencies for the long term (months or years). You own the asset outright (spot market), and you’re betting on long-term price appreciation.
- Crypto trading, on the other hand, is more active. It often involves short-term positions using leverage on platforms that offer futures contracts. You don’t own the actual asset—instead, you're speculating on price movements using borrowed capital, which comes with higher risk.
Understanding this distinction is key to choosing the right strategy that fits your goals and risk tolerance.
Different Types of Crypto Traders
There are three primary trading styles in the crypto world:
- Positional Trading – Holding trades for weeks or months.
- Swing Trading – Holding trades for a few days to a couple of weeks.
- Scalping – Entering and exiting trades within the same day.
Each style requires a different level of time commitment, strategy, and risk management. New traders often experiment to find the style that best fits their schedule and temperament.
What You Need to Start Crypto Trading
To get started with crypto trading for beginners, you’ll need three core tools:
- A Reliable Crypto Exchange
We recommend Bitnix for its clean user interface, mobile compatibility, and UK-friendly compliance. You can sign up using Learning Crypto's links for a welcome bonus and discounted fees. - TradingView for Charting
TradingView offers free and paid plans to analyze price charts and use technical indicators. The free plan is enough for most beginners. - A Proven Crypto Trading Strategy
Trading without a plan is gambling. We teach you how to build a trading strategy in our Premium, but here’s a quick overview of a simple yet effective approach.
Our Go-To Crypto Trading Strategy
At Learning Crypto, we emphasise momentum-based trading using a combination of:
- 21-period Exponential Moving Average (EMA)
- Relative Strength Index (RSI)
- Market Structure Analysis
For example, a recent trade setup involved the price breaking below the 21 EMA, forming a lower high, and the RSI dropping below 50. These confluences signaled bearish momentum, allowing us to short the market with clearly defined stop-loss and take-profit levels.
Risk Management: The Key to Long-Term Success
One of the most important elements of successful crypto trading is risk management.
- Always use a stop-loss to limit your downside. Place it just above your invalidation level—not too tight, not too loose.
- Risk only 1–2% of your account per trade. This means that even if your trade fails, your overall capital is protected.
- Aim for a risk-reward ratio of at least 2:1. That means if you're risking $100, aim to make at least $200. This approach helps you stack small wins without relying on one big trade.
Avoid These Common Crypto Trading Mistakes
If you're new to the space, here are mistakes to watch out for:
- Overtrading and revenge trading: Losing trades can trigger emotional decisions. Don’t try to “win it back” with impulsive trades.
- FOMO trading: Avoid jumping into trades just because the price is pumping. Wait for your trade setup to form.
- Poor strategy discipline: Stick to your trading plan. "Plan the trade and trade the plan."
Pro Tips to Level Up Your Trading Game
- Journal your trades. Keeping track of your wins and losses helps you identify patterns, refine your strategy, and avoid repeating mistakes.
- Join a trading community. Engage with like-minded traders, share setups, and learn from others in our Learning Crypto Discord community. We offer both free and premium access, including daily analysis, trade setups, and educational resources.
Final Thoughts
Whether you're brand new or looking to sharpen your skills, understanding how to trade cryptocurrency the right way starts with solid fundamentals, a well-tested strategy, and disciplined risk management.