The BTCUSD pair unites Bitcoin with one of the world’s most influential fiat currencies, the US Dollar. As such, it serves as an indicator for almost all cryptocurrencies and provides traders with important price direction cues.
CFD trading allows you to leverage your investments without actually owning the underlying asset, and any strategies used successfully for forex trading can be applied here as well.
Cryptocurrency
Bitcoin is an emerging global form of digital money that operates via distributed computer networks rather than being backed by physical gold reserves.
Cryptocurrency transactions are recorded on a public blockchain network that stores encrypted records of each transaction. Individuals and businesses alike can store units of cryptocurrency in digital or physical wallets and transfer them without intermediaries or middlemen.
Bitcoin’s price is determined primarily by demand. This has been driven higher with the entry of large companies such as Visa and PayPal into crypto markets as well as positive/negative media coverage.
BTCUSD can also be influenced by decisions of the US Federal Reserve regarding interest rate decisions, which can have an indirect effect on USD. The Fed meets eight times per year and their announcements can have a profound effect on cryptocurrency prices as they serve as alternatives to fiat currency.
Crypto CFDs
CFD Crypto Trading is an effective way of accessing the cryptocurrency market without purchasing actual coins directly. CFDs allow traders to speculate on whether the price of digital currencies will increase or decrease, offering potential returns at high margin. But it is essential to fully comprehend their associated risks before venturing into such volatile markets.
Crypto CFD traders can trade by going long or short (buying or selling). Like all CFDs, crypto CFDs leverage the underlying market, magnifying both profits and losses; this may increase your risk. To find out more, view our CFD Terms & Conditions and risk warnings; FCA-regulated firms must ensure you receive a fair and accurate price when selling your CFD position; this may not always be possible with highly volatile cryptocurrencies like Bitcoin.
Trading Cryptos
Cryptocurrency trading is a high-risk investment. To minimize risks and maximize gains, develop an organized trading plan. Market volatility offers both opportunities for large gains as well as greater potential losses – so don’t invest more than you are willing to lose!
Cryptocurrency trading is a zero-sum game: when more people want to purchase coins than there are sellers, their price increases. Conversely, when there are more sell orders than buy orders, its price decreases. Successful traders need to avoid succumbing to hope or greed, instead relying on technical analysis in order to predict trends and manage their emotions accordingly.
Trading cryptocurrencies is done using leveraged products known as CFDs, which allow traders to speculate on price movements without actually owning them. AvaTrade allows traders to trade CFDs on all of the most popular cryptocurrencies such as Bitcoin, Ethereum and Ripple as well as hundreds of smaller ones with lower margin requirements than direct ownership but profit and loss calculations are still calculated according to your total position size.
AvaTrade
AvaTrade is an internationally-recognized forex broker offering clients from every corner of the globe access. Their site supports multiple languages and currencies – USD, EUR, AUD and GBP among them – with traders having access to funding their accounts via credit or debit card or wire transfers.
The broker provides traders with over 1,250 instruments to choose from, including stocks, indices, commodities, bonds, ETFs and cryptocurrencies. Furthermore, traders may trade Forex pairs at up to 1:20 leverage.
At AvaTrade, upon registration clients must submit identification documents meeting international regulatory standards as well as provide proof of residence with an utility bill containing their full name and address. In addition, all associated fees such as spread charges and overnight funding charges (incurred due to bid-ask spread) for each pair are listed; additionally a helpful chart shows current average spreads across each currency pair.
