Blockchain and Cryptocurrency LVL 1 - About Crypto Currency Leveraged Tokens Trading
What Is Leveraged Tokens Trading?
When we talk of leveraged tokens, we talk of ERC-20 tokens that are issued on the ethereum blockchain. Leveraged Tokens Trading is basically a financial product that allows crypto traders to leverage without needing to worry about collateral or liquidation, increasing the profit potential from the leveraged cryptocurrency asset. While this leveraged tokens can help crypto traders make even more profit, they aren’t meant for long term hold because these leveraged tokens may lose significant value in a high volatile cryptocurrency market.
How To Plan For Trading In Leveraged Tokens?
Similar to planning for margin trading, trading leveraged tokens requires planning as well. To plan for trading leveraged tokens, the trader has to;
- As always when it comes to trading any cryptocurrency asset, the trading leveraged tokens requires a clear entry and exit plan
- Always pay attention to trends so as to make the best trading decisions.
- Never allow greed get into the way of trading leveraged tokens as it can lead to loss
- Have a clear understanding of the risk level associated with trading any financial instrument.
- Make sure to do proper technical analysis before jumping into any margin trade so as to be able to predict the price direction of the cryptocurrency
- Not allow personal emotions get into the way of trading
- look out pay attention to sentiments which can drastically affect the price of any cryptocurrency
- Have a clear strategy before jumping into any margin trading
- follow strict trading rules to serve as a guide.
Crypto Exchanges Name That Provide Leveraged Tokens Service and What Margin They Provide In Leveraged Tokens?
- BitMax – Provides trading leveraged tokens up to x3
- Hedge – Provides trading leveraged tokens up to x1
- Kraken - Provides trading leveraged tokens up to x5
- Kucoin – provides up to x10
- Huobi – provides leveraged tokens up to x5
When it comes to making correct and realistic price predictions, technical analysis, fundamental analysis and sentimental analysis are all key, whether it is regular spot trading, or margin trading, or trading leveraged tokens, these analysis types are key to making correct trading decisions. Also, it is important to make a clear plan before venturing into any form of trading financial instruments like margin trading or trading leveraged tokens, a clear plan helps to reduce the risks involved in margin trading or trading leveraged tokens.
