Cryptocurrency trading is something that you may find attractive based on the potential returns. Any beginner in this field may get exposed with random bits of knowledge that may require an in-depth elaboration. This guide aims to impart knowledge about cryptocurrency trading and cryptocurrency trading tools. You may know that cryptocurrencies are digital currencies which can be traded across exchanges. However, just opening an account with an exchange and starting off can be a hefty challenge. Gaining some knowledge about various exchanges and the cryptocurrency trading platforms may help you perform better trades. You may want to trade through a platform that suits your needs rather than one that is touted as the best. Read on to learn more about some cryptocurrency trading tools you can use.
Basics of Cryptocurrency Trading
Let’s start with the basics of cryptocurrency trading. You can buy and sell cryptocurrency and trade using cryptocurrency on exchanges that have been set up for this purpose. You need to create an account with a cryptocurrency exchange and then use that account to trade. An account with a cryptocurrency exchange allows you to trade using the exchange where you created the account.
The exchange brings together buyers and sellers of cryptocurrencies. It then facilitates the exchange of cryptocurrency by providing a common interface. Buyers and sellers place their orders in terms of the number of cryptocurrencies that they want to sell and the price at which they want to sell. The exchange fulfils the order between a buyer and a seller if the price band of the seller matches that of the buyer. Thus, the cryptocurrencies change hands on a mutually agreeable price.
Cryptocurrency Trading Platforms
Exchanges allow you to place orders and execute trades. However, they may not give you a composite solution to all that you seek. The end trade has to go through an exchange, that is for sure. However, cryptocurrency trading platforms provide traders with tools that they can use to obtain additional possibilities for crypto trades.
These trading platforms help traders by allowing them to analyse data and subsequently place their orders. They allow traders to go utilize their platform to assess the prevailing market prices before placing orders. Beginners in crypto trading can consider the services provided by cryptocurrency trading platforms. This is because they will give you the ability to monitor several exchanges by linking them to one platform. Trading platforms can help you make well-informed decisions which may lead to better trades.
Torex Cryptocurrency Trading Tools Explained
There are numerous cryptocurrency trading platforms which you can opt for. However, keep in mind that you should choose a platform that suits your needs rather than a platform that is touted as a good one. Different traders have different needs so one platform may not be suitable for each and every trader. If you are looking for a good cross-functional platform that supports multiple exchanges, then you can try using Torex. Torex currently supports the Bittrex, Binance, BKEX, Huobi, Crex24, Coinsbit, Poloniex, KuCoin and Bitfinex exchanges.
As mentioned earlier, Torex supports multiple exchanges. This allows you to parallelly monitor the prevailing prices of cryptocurrencies across different exchanges. This is a significant advantage since an account with an exchange restricts you to monitoring and trading through that exchange itself. With Torex, you can access trading opportunities across multiple exchanges and then trade across these multiple exchanges via API within one Torex interface.
Price monitoring across different exchanges presents you with certain cryptocurrency arbitrage opportunities. As a trader, you can use the price differences across different exchanges to try and make a profit. You can buy from an exchange at a lower prevailing market price and then sell at an exchange with a higher prevailing market price. You can also buy from an exchange with higher liquidity and then sell at one with lower liquidity. These arbitrage opportunities allow you to potentially book profits within a comparatively shorter time period.
We can further explore this with an example. You can buy a unit of cryptocurrency for $1000 off one exchange and sell it at another exchange which has a prevailing market price of $1100. Thus, you have made a profit of $100 per unit of cryptocurrency. If you trade in larger volumes, you can potentially make larger profits. This is because the profit per unit will get multiplied by the number of units bought and sold. Cryptocurrency arbitrage requires minimal waiting and involves capitalizing upon price fluctuations.
Cryptocurrency trading exchanges may not offer you the enhanced ability to analyse and trade simultaneously. Torex considers implementing news aggregators on their platform. Such aggregators can be used by crypto traders to search for news for analysis. Torex offers you analytical tools such as Price Checker, Price Notification and Arbitrage Tool that can be used to perform market analysis. Technical analysis can help you get some firm basis for your trades.
Multi-Exchange & Multi-Coin
Torex currently supports 9 crypto exchanges on its platform. They can be linked to Torex using API keys. The API keys allow Torex to interface with the cryptocurrency exchanges. They allow Torex to access the database of the exchanges and display it on your Torex account dashboard. You can use Torex to identify trading opportunities across multiple exchanges and then capitalize upon them. Torex also offers the possibility to trade with numerous cryptocurrencies available on the supported crypto exchanges.
Multiple Trading Tools
Torex offers you multiple trading tools in order to enhance your trading experience and potentially make it smoother. It has a Price Checker tool which you can use to fetch prevailing prices across supported exchanges. This can help you find the best price band for your trade across multiple exchanges. Also, it can help you decide on which exchange you can place your orders to potentially maximize profit.
Using Torex, you can also set up price notifications. The Price Notification tool uses a bot to send you a notification when a predetermined trigger is hit. You can set your own triggers and you will receive a notification via Telegram if your trigger condition is met. You can set up triggers to notify you when the prevailing price on the exchanges is equal to, above or below a certain value.
This allows you to keep track of the prices without staying glued to a computer or a smartphone. You can just set triggers for notifications and let the bot alert you when the trigger condition is met. You can also set a dynamic stop-loss order in order to maximize your booked profit. Dynamic stop-loss orders also help you in keeping your unrealized profit safe from erosion. It is a trailing stop order that on its own adjusts and moves beyond the existing market price. The dynamic stop-loss order type allows you to possibly get meaningful retains without continuously monitoring the prevailing prices.
Advanced Arbitrage Tool
Torex has a cryptocurrency arbitrage tool that can be useful to those traders who are interested in following a crypto arbitrage strategy. Cryptocurrency arbitrage involves utilizing the price differences across different exchanges to make profits. You typically buy from an exchange with a lower prevailing price and then sell at an exchange with a higher prevailing price. The difference between the two prices, excluding transactional commissions taken by the exchanges, can be your profit. It can be hard to identify such arbitrage opportunities manually.
Torex’s cryptocurrency arbitrage tool can be helpful. You can select two or more exchanges and then run the tool. It will assess different exchanges and reveal possible arbitrage windows if any. You can even set your own parameters to get arbitrage opportunities that suit your trading goals.
Additionally, the tool also checks the order books to ensure that the tokens thrown up have sufficient liquidity. You can set your own minimum daily volume and any tokens trading below that volume will not show up in the results. Only tokens with sufficient market depth for making arbitrage transactions will come up through the tool. You can set the arbitrage volume that you desire. Thus, this tool makes spotting arbitrage opportunities easier by automating it.
You don’t need a classic desktop or a laptop to run Torex. You can use Torex easily through handheld devices thus allowing you to trade in cryptocurrencies on the go. Additionally, you can set your triggers and just open your smartphone to trade when you get notifications. Using a trading platform compatible with handheld devices allows you to almost never miss a trading opportunity.
The Torex cryptocurrency trading app is already available at Google Play. APK file for installing Torex on Android devices is also available on Torex’s website. Torex plans to launch an app on the App Store digital distribution network soon. This will make accessing cryptocurrency trading opportunities on the go potentially easier for you. You can register on the website in order to get further alerts and updates on Torex’s offerings.
By now, some aspects of the role that trading platforms can play when it comes to trading in cryptocurrencies have been described. You can trade directly through an exchange but in some cases trading through a platform like Torex can be more convenient. It is a platform that can be used by people with brief trading experience as well. An account opening procedure at Torex is simple and can take literally a minute. Beginners and experienced traders alike can head over and open a free account with Torex.