How Do You Trade BTCUSD

In trading Bitcoins online a trader can either buy or sell Bitcoin contracts so that to make profits.

One will buy Bitcoin if they think that the value of Bitcoin will appreciate against the US Dollar or they can sell Bitcoin if they think the price of Bitcoin will depreciate against the US Dollar.

Buy Trade - Go Long

When the Bitcoin prices are heading up, then traders will buy Bitcoin. This also is known as going long. Going long is another name for buying.

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Buy Trade - Going Long - Bitcoin Trading

In the trade above when the prices of Bitcoin are moving up, a trader will open a buy trade as shown above. This is known as going long - a trader will hold this buy trade as long as the Bitcoin prices continue moving in this upwards direction.

The price of Bitcoin will continue moving upwards as long as both MAs are pointing upwards. The two moving averages are used to show and display the direction of the prices - what is commonly referred to as the market trend. The method of using of two moving averages is known as Moving Average crossover strategy. A shorter moving average and a longer moving average for example the 5 period moving average MA and 7 period moving averages are used together to come up with the above MA cross over strategy of determining the general direction of Bitcoin prices. At any one time these moving averages will either be moving in an upward direction or a downwards direction - at other times when the market prices are consolidating, the moving averages will move sideways showing that prices are neither moving upward or downward.

Sell Trade - Go Short

When the Bitcoin prices are moving down, then traders will sell Bitcoin. This also is known as going short. Going short is another name for selling.

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Sell Trade - Going Short - Bitcoin Trading

In the above trade, the Bitcoin prices are moving downwards as is illustrated by the 2 MAs which are both heading downwards. A trader would open a sell trade and this is referred to as going short. The trader will then keep their short trade open as long as the prices continue moving downward.

Bitcoin Crypto Currency Charts

Now that as trader you know when to buy and when to sell Bitcoin, the question is how to sell or where to place the buy or sell trade.

To do this a trader will use the Bitcoin charts provided. A Bitcoin Crypto Currency chart will represent the movement of Bitcoin prices and draw this using a graphical format which can be used by technical traders to analyze and interpret the Bitcoin price movement.

Learn BTCUSD Currency Chart - Bitcoin with Live Examples of Bitcoin - How to Trade Bitcoin - Bitcoin Charts Tutorial

BTCUSD Price Chart

The above Bitcoin chart which is the 1 hour trading chart shows the upward movement of Bitcoin prices from $3584.416 per Bitcoin to $4253.647 per Bitcoin during the month of September 2017.

The price is shown by the vertical axis that has price markings and the date is illustrated by the horizontal axis that has date and time markings.

The price of Bitcoin and its movement is represented in the form of a chart. The chart shows an upward movement of the price. Traders who are trading Bitcoin will analyze this price movement to know which direction to trade. In the chart example above because prices are moving upwards a btcusd trader would buy the Bitcoin and go long.

A trader can open a buy or a sell trade directly from this chart. By right clicking anywhere on the chart - a menu will appear and the online trader can choose & select the open new trade order option and open a new Bitcoin trade.

Calculating Profit

When trading BTCUSD Crypto, profit is calculated using the price movement - the difference between where a btc usd trader opens a trade and where they close out the trade will be used in calculating the profit.

In the above example where Bitcoin prices moved from $3584.416 per Bitcoin to $4253.647, if a trader opened a buy trade at $3584.416 per Bitcoin contract and closed the trade at $4253.647 per Bitcoin contract, the price difference would be $669.231 dollars.

Because Bitcoin is traded in lots of 1 Bitcoin, then trading one lot of Bitcoin will mean that for this one move the trader would have made $669.231 trading one Bitcoin contract and if the trader was trading 10 Bitcoin contracts they would have made a profit of $6,692.31.

To trade 10 Bitcoin lots a trader would not need to have 4,253.647x10= $42,536.47 - because there is leverage provided by the online Bitcoin trader which is 5:1 meaning a trader would only need to have one fifth of this amount to open 10 contracts, a fifth of $42,536.47 is equivalent to $8,507.294 - therefore a trader with $8,507.294 in their account can open and trade 10 bitcoin contracts using this leverage option of 5:1 provided by the online Bitcoin broker.

This means that is a trader had bought 1 lot of Bitcoin at $3584.416 per Bitcoin and closed the trade at $4253.647 per Bitcoin, where the price difference would be $669.231 dollars. Then trading 1 Bitcoin contract, then this would mean the trader would have made $669.231 in profit from this trade.

To buy one lot of Bitcoin which is equal to $4253.647 - a trader would need to have capital of $4253.647. Because not very many retail traders can afford that amount of money - Bitcoin brokers provide leverage, which means that bitcoin traders can trade using borrowed capital. With the default leverage of 5:1 for - it means that traders can borrow 5 times their capital which means to open a one lot of Bitcoin traders will only need to deposit $850.729 dollars in their account and they can now open one lot of BTCUSD - the $850.729 multiplied by 5 times which is the leverage of 5:1 is equal to $4253.647 - which is the amount of capital that a trader will control after using leverage.

BTC USD Crypto Software/Platform

The BTC/USD Crypto price charts can be accessed from the BTC/USD Crypto platform provided by online Bitcoin brokers - BTCUSD cryptocurrency BTCUSD is now provided for by the traditional Forex currency trading brokers & BTCUSD can now be traded alongside traditional currencies such as EURUSD and GBPUSD. The software is the software which traders will use to connect to their brokers & place trades in the online Bitcoin market - The platform used to trade Forex Currencies is the same platform that will be used to trade cryptocurrencies such as Bitcoin BTCUSD.

The platform used is MT5 platform software, The platform will draw the price charts for the trader. The platform also will calculate the profit and losses from the trades opened by the online trader & the trader does not need to calculate trading profits, the profits are calculated automatically/mechanically.

The platform can be downloaded from the Bitcoin broker's website and beginner traders can learn how to use this platform software using a practice demo account.

Practice Demo Account

Demo practice trading account is a practice account that traders use to learn about the platform used to trade Bitcoin and how to open and close trades without the need first of investing their own money. The money used on this practice account is virtual and traders can practice with the virtual funds until they learn enough about Bitcoin trading. Once traders gain enough knowledge and experience to help them earn profits then the online traders can then decide to open a real Bitcoin account and begin trading Bitcoin contracts online.

Live Bitcoin Account

The live Bitcoin account is the account used by traders to trade Bitcoin in the online market. With this trading account a trader will trade with real money, a trader will have to make a deposit in to this account and after that the online trader can place Bitcoin trades in the market through this account and the profit/losses they make will be credited to this account.

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