Published vor 4 Monaten • 4 minute read

How Can You Trade Ethereum?

The world of cryptocurrencies has recently been on a significant uptrend. Many major digital instruments have seen a lot of volatility and liquidity, with new investors flocking in to join the burst. Ethereum is one of the major cryptocurrencies that comes just after Bitcoin in trading volume.

How Can You Trade Ethereum

Ethereum was first developed by a Russian Canadian developer back in 2013. Later on, the development work was done in 2014, and the currency was put forward for trading in 2015.

Ethereum is widely available amongst all cryptocurrency brokers as a major coin. After opening an account by providing their email and credentials, traders can immediately access it.

Brokers have strict identity regulations to ensure that there are no money laundering issues.

Like other financial instruments, traders can speculate on Ethereum on long and short sides. Ethereum trading is done using a platform that the broker provides. Let us go through a few essential characteristics of trading this digital asset.

Similar to Bitcoin, Ethereum is available to trade 24/7. Traders can trade it on regular weekdays and weekends. This is perfect for anyone who likes to access the financial market at their wish.

Liquidity is abundant in Ethereum, making it easy to get in and out of positions. The delays are minimal; however, they can vary according to the broker.

Ethereum follows the trend produced by Bitcoin. There is a high degree of correlation between the two digital coins.

How Can You Trade Ethereum Graph 1

Image 1. The trading chart of bitcoin on the 5 minute time frame. We will contrast it with the second image to see how similar the price is.

How Can You Trade Ethereum Graph 2

Image 2. The trading chart of Ethereum on the M5 chart. Here you can contrast and see how the price follows its parent BTC. Traders commonly employ price correlation techniques to predict the future of the market.

Ethereum mining is one of the standard practices of investors worldwide. This can generate a huge amount of passive income without any effort. When traders use their hardware for mining, they get coins as a reward for solving a crypto puzzle.

Mining farms are commonly set up to extract a vast amount of crypto coins. The profitability of these assets can vary depending on the hardware and electricity costs.

Other than price correlation, different strategies are commonly employed to trade Ethereum. Investors look out for fundamentals or news coming from big billionaires such as Elon Musk as they can drive the price of crypto up or down significantly. Technicals can also play a crucial role in cryptos. Support and resistance levels are key indicators to identify potential points of reversal and new highs.

Grid strategies involve buying the cryptocurrency regularly at several intervals. Traders also use lot multiplication with averaging to increase the chances of making money.

Algorithmic trading is also under highlights, where a trader uses a robot to trade the markets on full auto mode. Expert advisors can carry out arbitrage or high-frequency trading, which is normally impossible for humans.

How Can You Trade Ethereum Graph 3

Image 3. A key support level is identified by a trader, which is marked by a green arrow. The market ranges between the two points, which provides an opportunity to set up a buy limit order at the support.

A few advantages of Trading Ethereum are:

  • Traders can trade it 24/7
  • The mining process can be profitable for many
  • Algorithms can be highly beneficial to trading Ethereum
  • The transactions are faster in contrast with Bitcoin

While some of the demerits can be stated as:

  • For some traders, the increased volatility in Ethereum can be confusing
  • The cryptocurrency has been a target for hackers previously

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