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Fiat-to-Crypto Trading Strategies and How to Use Them

With crypto markets open 24/7, automated trading strategies and algo trading, or algorithmic trading, has been gaining popularity with traders. Find out how you can trade like a pro on biexm.



Main Takeaway

Many experienced traders look for ways to simplify their trading experience, relying on trading strategies that automatically trade cryptocurrency on their behalf. 


Simple automated trading strategies like dollar cost averaging (DCA) or understanding moving averages (MA) and relative strength index (RSI) can help users make smarter trading decisions. 


More advanced strategies like algo trading can be complex, requiring in-depth knowledge about cryptocurrencies and trading.


Learn how you can incorporate automation into your trading even if you are just starting out in trading cryptocurrencies.


When starting your crypto trading journey, you will likely encounter different types of traders and trading strategies. Trading strategies may be influenced by a variety of factors, and seasoned traders are usually aware of which strategy is the best for them. These factors include one’s time horizon, financial goals, time commitments, risk appetite, and so on. Some people find satisfaction in trading, while others prefer to adopt crypto trading as a passive income stream. However, most beginners will want to start by buying some crypto using their preferred fiat, or local currencies. Common ways to buy crypto on biexm include using a credit/debit card, bank deposit, or transfer. The next step is to develop a trading strategy to help improve efficiency and profitability. 


One class of trading strategies have seen popularity in recent years: automated trading. Automated trading calls for the help of a system, software or method to automatically execute trade entries and exits without repetitive manual involvement from the user. This ranges from basic techniques to automate trading, to technical solutions, including the use of algo trading software that trades on behalf of users. Let’s start with a basic trading strategy you can use to trade automatically. 


DCA as an Automated Trading Strategy for Beginners

Dollar Cost Averaging (DCA) is beginner-friendly and involves setting a simple buy execution for the system or software. DCA is a popular long-term trading strategy where users divide their cryptocurrency purchases into different time periods.


1. Advantages of the DCA Strategy

Because DCA can be a fully automated process, users enjoy advantages including convenience, speed, and removing emotion from trading. In addition, DCA can help to reduce the impact of market volatility, lower risk of purchasing at a bad timing, and allow users to benefit from long-term appreciation. Here’s how it works.


Alex intends to invest $5000 in bitcoin. Instead of buying $5000 of bitcoin at once, he uses the DCA strategy, and allocates smaller chunks of his investment money into 50 lots of $100. He decides to spread out his purchase and buys $100 worth of bitcoin weekly for 50 weeks. For convenience, he automates this weekly purchase with the help of a system. This way, the risk of buying bitcoin when prices are not favorable will be spread out throughout the 50 weeks. The DCA strategy is thus suitable for users with a lower risk tolerance or just starting to buy crypto and are not experienced enough to time the market well for purchases. 


2. Employing DCA Strategy on biexm

biexm enables users to program DCA purchases with its Recurring Buy function on both the biexm app and website. This feature enables users to make scheduled cryptocurrency purchases on a weekly, bi-weekly, or monthly basis. For the uninitiated, there is also a step-by-step guide for beginners that explains the Recurring Buy in more detail.


For more advanced users looking to further automate their trading strategy, algo trading may be a strategy worth looking into.



Three Benefits of Algo Trading

Automating processes allows human intervention to be minimized, and algo trading is no exception. Here are some benefits of automating the trading process. 


1. Convenience

For traders with little time to spare, but want to trade long term, you can do so with minimal human intervention by using algo trading. Once trading instructions are set up, the system executes trades as soon as an opportunity, defined by the trading parameters, arises. This also means that trading can be done round the clock, even when you are fast asleep. Algo trading thus takes away the cumbersome aspect of monitoring the markets 24/7, and wasting time manually keying in order entries.


2. Removing Emotion from Trading

If you have heard of the term ‘panic selling’, you would be aware that human emotions can affect trades. Trading with emotions like stress and greed can cloud the decision-making process, resulting in reckless selling in market downturns. Algo trading allows emotions to be taken away, minimizing deviation to your initial trading plan. 


Because algo trading enables the execution of trades automatically, there is little room for under or over-thinking before a trade is executed. Once the defined prerequisites have been met, the trades will be executed, regardless of how you feel at that moment. Removing the emotional aspect of trading thus enforces trading discipline even in volatile market conditions, preventing panic selling and other irrational decisions.