What tools are used by professional traders?

A large number of people are constantly making or losing money in the crypto industry. Why is this happening? A key difference between a professional trader and an amateur trader is the use of trading tools available on the market. By using tools that assist in understanding the market trend, and then determining where to enter or exit a transaction. In today’s market, traders have access to a variety of tools that they can choose from depending upon their level of experience, knowledge, and requirements. The following article from Mazdax Academy outlines a number of cryptocurrency trading tools that will completely change the way you interact with the crypto market.

1. Centralized exchanges

Choosing a reliable exchange for trading is the first step in making a profit. They are your gateway to the world of cryptocurrency. In order to determine if an exchange is suitable, it is important to consider three basic factors: liquidity, security, and fee rates. If you are considering using a digital currency exchange, make sure you take into account these three factors.

Liquidity: Describes how easy it is to buy or sell an asset. You will always find a buyer or seller waiting on the other side of your order request if there is a lot of liquidity.

Security: You should ensure that the security of your funds when depositing them in an exchange is adequate. Exchanges are constantly subjected to attacks. Imagine waking up one morning and finding out that all of your funds have been stolen from the exchange.

Fee Rates: Fee rates are one of the most important considerations for top crypto traders. They are always seeking exchanges with low transaction costs.

2. Decentralized exchanges

A decentralized exchange (DEX) functions similarly to a centralized exchange, but its technical infrastructure is decentralized. Decentralized exchanges offer the advantage of allowing users to keep funds in their personal wallets instead of transferring them to the exchange. Additionally, DEXs provide greater security than centralized exchanges, but they are often more difficult to use and less liquid than centralized exchanges.

3. Trading platforms

Trading platforms are among the best tools for making cryptocurrency trades as simple as possible. The convenience of having multiple transactions on a single platform has replaced the need to open separate tabs in your browser for each transaction. By doing so, you can take advantage of market opportunities more quickly and monitor the market closely.

4. Diagrams and charts

With charts, you can view various trading indicators and draw trend lines in order to gain a better understanding of the market. Practicing these trading indicators and trend lines will eventually improve your analytical skills, and this is what many professional traders rely on to make their decisions. You should use crypto analysis tools such as TradingView if you wish to become a professional technical analyst.

TradingView

TradingView is a leading provider of online trading charts for cryptocurrencies and the stock market. This platform provides a wide variety of technical indicators and is one of the largest chart providers. Trading view offers two types of accounts: free and premium. The premium account provides unlimited access to all time frames, indicators, and analysis tools. Most cryptocurrency traders today use TradingView as their primary charting tool.

5. Market data

Every trader should have access to an online tool that provides accurate information regarding price, circulating supply, supply cap, and more. The market data process involves ensuring that it is accurate, then integrating it with various exchanges, normalizing and averaging prices. To become a professional investor or trader, you must possess market data. Several platforms provide market data today, but Coin Market Cap is one of the most prominent. We will introduce some providers of market data in the following paragraphs.

Coinmarketcap

In general, Coin Market Cap is the most commonly used website to monitor the price, trading volume, supply of coins, and all other aspects of the cryptocurrency market. Furthermore, Coinmarketcap provides a robust API that can be used to import data into your platform.

Here are a few of the features offered by Coin Market Cap:

• Offering data on more than 17 thousand cryptocurrencies
• A free, customizable portfolio
• Ranking of all exchanges around the world according to user points

Coin Metrics

In the field of digital currency analysis, CoinMetric is one of the leading websites that provides users with chain or on-chain data. This website provides network data analysis, indicators, reference rates, etc. In contrast to other data providers, CoinMetric updates its data every minute or every few seconds. In addition to this, people who have experience in blockchain programming can create their own indicators using the data presented on the CoinMetric website.

Glassnode

Glassnode is another data provider website that is capable of performing on-chain analysis. One of the most important functions of Glassnode is to develop trading strategies for the trader. As an example, you can determine whether a cryptocurrency’s market is bearish or bullish by checking its number of active addresses.

OnchainFX

There are many similarities between OnchainFX and CoinMarketCap, however, it provides more unique statistics as well as the option to personalize the user dashboard. Among the options available to users are coins that are scams, top winners, top losers, or predictions that estimate the value of the market in 2050. OnChainFX has become one of the most trusted sources of market data these days.

Crypto View

CryptoView is an excellent website for analyzing data related to digital currencies, which, like most analytical platforms, collects its information from TradingView. A unique feature of the Crypto View platform is that it compares your trades with those of professional traders and displays the results. As a result, you will gradually become a professional and approach the trading path step by step.

6. Don’t miss hard forks, airdrops, and halvings

Monitor the market using reliable calendar services, rather than relying on news articles to provide information. A market calendar allows you to view upcoming market events at a glance.

As an example, the price of a coin increases when its halving happens (such as Bitcoin in 2020), or if a hard fork occurs, there is the possibility of receiving free coins. What matters is that all of these events may have an impact on the price of cryptocurrencies or provide opportunities for profit-making. Therefore, these services may be useful for you.

CoinMarketCal

CoinMarketCal is a popular calendar tool for separating rumors from news in the cryptocurrency market. You can use this tool to receive news and rumors regarding the upcoming events of different coins on this platform.

7. Network statistics

Don’t let negative news convince you that Bitcoin transactions are slowing down or fees are too high. You should use available statistical tools to receive this data directly and evaluate how active a network like Bitcoin, as well as its development team, is.

A high level of activity in Bitcoin network transactions may be an indication of future price movement. You will have an edge over other traders by understanding the activity level of a digital currency network and the activity of the project’s development team.

Bitcoin Visuals

Bitcoin Visuals is an excellent cryptographic tool for syncing with network information. Using this tool, you can quickly see average transaction fees, hash rates, and how the network is performing. It may be a good time to invest if you see that fees have declined and the number of miners is increasing.

8. News aggregators

There are hundreds of news sites publishing thousands of articles each day, and Twitter influencers post conflicting opinions. Having a source that can aggregate all of this information in one place is very useful for keeping a pulse on the market and keeping up with the news.

CryptoPanic

Crypto Panic is a free and comprehensive news aggregator tool that lets you customize your dashboard for price alerts! It is quite confusing for many traders when it comes to breaking news. Crypto Panic is a valuable resource for cryptocurrency news analysis.

FAWS

Similar to Crypto Panic, FAWS is a news aggregator service. Compared to CryptoPanic, FAWS depends on your user interface preferences. The news on FAWS is considered to be more attractive and easier to read by some users, while both websites are equally useful.

9. Research reports

An analysis report is typically a long, in-depth, and highly valuable document that provides fundamental analysis, technical analysis, and commentary on the past, present, and future of the market.

10. Trading robots

Trading bots are computer programs that allow you to set certain parameters for automatic trading. Every trader adjusts his trading robot automatically according to his unique strategy. The right strategy, coupled with a reliable bot, can even allow you to earn profits while you sleep! However, many robots are also unreliable as well.

HaasOnline

After five years of operation, HaasOnline has proven itself to be a reliable robot in the crypto sector. With hundreds of technical indicators to choose from, a stylish user interface, and reliable performance, HaasOnline is the perfect solution for you. If you wish, you may also use these robots to create arbitrage opportunities. To conclude, having a crypto tool that enables you to test automated trading solutions will assist you in maximizing your profits.

Gekko

Another free and open-source trading bot that can be downloaded from GitHub is Gekko. There are 14 major exchanges supported by the bot, making it one of the most widely used platforms in the market. Considering that this bot is an open-source project, you will need to manually download some requirements in order to use it.

11. Portfolio tracker

You can keep your finger on the pulse of the market by using portfolio trackers, one of the most widely used trading tools. By using this tool, you will be able to see the value of your investments and the changes in their value over the past 24 hours. Moreover, if you notice that a particular token is adversely affecting your portfolio, you can identify it and decide whether or not to keep it.

Blockfolio

Blockfolio is the largest portfolio tracker available exclusively for mobile devices. The tool has an easy-to-use interface, as well as a news and signal section. The only downside of Blockfolio is that you must manually enter your cryptocurrencies, but from a security perspective, this may be considered an advantage.

Cointracking

Cointracking is the most popular web-based tracking service that can be integrated with almost any exchange. Once you enter transactions, this tool will calculate your historical data automatically. The majority of cryptocurrency traders use Cointracking as a primary tool for tracking their investments.

Blox

The Blox portfolio tracking platform is a great option for those seeking web-based portfolio management. The tool is available in both a free and a premium version. Using a free account, you can automatically track multiple portfolios up to $50,000, or up to 100 transactions. Therefore, if your portfolio exceeds this number, you will need the premium version.

Portfolio rebalancing

Portfolio rebalancing tools, also known as rebalancing, are frequently used by professional traders because they reduce risk and preserve profits. The Portfolio Balancer automatically purchases and sells assets according to the weight of your portfolio.

It is possible, for example, to set your Ether holdings to always be worth 10% of your portfolio. If Ether rises to 30% of your portfolio, the tool will automatically sell some of your Ether to maintain your portfolio balance. Rebalancing tools are now used by hedge fund managers as well.

By doing so, you are protected from excessive holdings of certain assets and are able to maximize your profits.

Shrimpy

Shrimpy is an excellent free portfolio balancer and backtester. With Shrimpy, you are not only able to balance your investment portfolio, but also test different strategies by backtesting them on exchanges.

3 Commas

3 Commas is a portfolio balancing tool that is equipped with some additional features. Rebalancing can be scheduled every 12 hours, for example. In addition to offering general portfolio management tools, 3Commas allows you to trade manually from its platform as well.

Conclusion

Using a practical approach is the best way to select different trading strategies and tools. Throughout this article, we have attempted to introduce you to the best tools every professional trader needs. Among these tools, some have relative advantages over others. It is ultimately up to you to choose the one that meets your needs.