The sharp rise in Bitcoin’s price has led many forex traders to try trading Bitcoin. Indeed, if there is a financial asset showing decent returns, why not make money on it? We will explain the most important points you need to know to trade Bitcoin.
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- How Bitcoin Is Used on Forex
- Which Cryptocurrencies Can Be Traded on Forex
- Features of Trading Bitcoin on the Forex Market
- Brokers Offering Bitcoin Trading
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How Bitcoin Is Used on Forex
Bitcoin on Forex can be used in two ways:
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- Deposit in Bitcoins
Most traders typically open a trading account in dollars. However, some forex brokers allow opening an account in Bitcoins. For example, the equivalent of a $10,000 deposit would be 1.39 BTC. Trading regular currency pairs, the trader makes a profit or loss in Bitcoins.
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- Trading Bitcoin
Like other currency pairs, Bitcoin is traded as a currency pair of Bitcoin to USD. In the trading terminal, it is denoted as BTCUSD or Bitcoin.
Which Cryptocurrencies Can Be Traded on Forex
Along with Bitcoin, some brokers offer trading in the following cryptocurrencies:
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- Bitcoin Cash[info_block align=”right” linkText=”Virtual Millions Today. Bitcoin – Mining and Trading” linkUrl=”https://fortraders.org/learn/forex-trader/virtualnye-milliony-segodnya-bitkoin-v-voprosax-otvetax.html” imageUrl=”https://files.fortraders.org/uploads/2017/06/bitcoin-730×354.jpg”]All You Need to Know About Bitcoin[/info_block]
- Dash
- Ethereum
- Litecoin
- Ripple
- and others
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All these currencies are traded against the dollar and have the same notation in the trading terminal, such as ETH/USD (Ethereum to USD).
Features of Trading Bitcoin on the Forex Market
Trading the BTC/USD pair is technically no different from trading regular forex currency pairs. Buy and sell orders are placed, stop-loss and take-profit orders are set.
In the Bitcoin to USD pair, key principles of technical analysis apply. Trend lines, support/resistance levels, technical analysis patterns, and candlestick patterns can be built.
You can use the same technical indicators and trading advisors for Bitcoin trading on Forex as for regular currency pairs.
However, trading Bitcoin has several specific features:
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- Bitcoin is traded 24 hours a day, 7 days a week.
- News has a longer impact on the price.
- A relatively large spread is set for the Bitcoin to USD pair. This makes scalping impossible. For trading, it is recommended to consider timeframes of H1 and above.
- There is no division of the day into trading sessions for Bitcoin. Activity spikes in the BTC/USD pair can occur at any time of day.
- Due to low liquidity, especially before major news releases, gaps may form in the Bitcoin to USD pair.
- High volatility due to low liquidity.
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Brokers Offering Bitcoin Trading
Many forex companies now offer cryptocurrency trading, including Bitcoin, and also allow opening accounts in Bitcoins. Here is a list of the most popular ones.
Forex Club
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- Minimum deposit: $1
- Platform: MetaTrader 4, MetaTrader 5, online platform Libertex
- Maximum leverage: 1:500
- Commission: 0.4%
- Regulator: CySEC, Central Bank of Russia, RAUFR
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>> Go to the Broker’s Websitenn
Alpari
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" />Minimum deposit: $1- Platform: MetaTrader 4, MetaTrader 5
- Leverage: 1:10
- Commission: 0
- Regulator: Central Bank of Russia, IFSC, CySEC
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>> Go to the Broker’s Website
Exness
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" />Minimum deposit: $1- Platform: MetaTrader 4, MetaTrader 5, Web Tradng
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FAQ
How is Bitcoin traded on Forex?
Bitcoin can be traded as a currency pair, such as BTCUSD, similar to traditional forex pairs. Traders can also open accounts in Bitcoins instead of fiat currencies.
Which cryptocurrencies are available on Forex?
Forex brokers typically offer trading in Bitcoin, Ethereum, Litecoin, Dash, and other cryptocurrencies against the US Dollar (e.g., ETH/USD).
What are the features of trading Bitcoin on Forex?
Bitcoin is traded 24/7, has high volatility, and may experience large spreads and gaps. Technical analysis and standard forex tools apply, but scalping is generally not recommended.
