Guide to day trading crypto

We break down common crypto day trading strategies and our top picks for the best crypto day trading platform in Canada.

Day trading crypto involves buying and selling within a single day or trading session to profit from short-term price changes. It’s complex and high-risk. Not for beginners, crypto day trading strategies demand considerable knowledge, experience and discipline to achieve consistent success.

Read on to learn more and view our top picks for the best crypto exchange for day trading in Canada.

This is not an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade or use any services.

The best crypto wallets in Canada in 2025

  • Best crypto exchange for day trading overall: Coinbase
  • Best crypto exchange for high-volume day traders: Kraken
  • Best crypto day trading platform for the most supported coins: Bitget
  • Best for day trading crypto & fiat on a single platform: Uphold
  • Best day trading platform for advanced order types: Crypto.com
  • Best regulated platform for day trading crypto: Bitbuy
  • Best Canada-based broker for day trading crypto: Netcoins
  • Best for day trading crypto & stocks in a single app: Wealthsimple

Best crypto exchange for day trading overall: Coinbase

Coinbase

240+
Supported cryptos
1
Fiat currency
Launched in 2012, Coinbase is one of the longest-running and most reputable crypto exchanges. It has over 105 million users and is regulated in the US, UK, Canada and other countries. Over 240 coins and tokens are listed, including most major trading pairs. It's frequently in the top five exchanges by global 24-hour trade volume. Coinbase Advanced is the platform's home for serious traders and offers maker and taker fees starting at 0.4% and 0.6% respectively. High-volume traders get discounted fees.
Pros
  • Easy signup process
  • Trade 240+ cryptos
  • Free e-Transfer deposits. Instant withdrawals to most banks.
  • Discounted volume pricing with Advanced Trade
  • Registered with the Canadian Securities Administrators (CSA)
Cons
  • Only hold CAD in Canadian accounts
  • No credit card purchases in Canada
  • No margin, futures or options trading in Canada
Deposit methods Debit card, Electronic Funds Transfer, Interac e-Transfer, PayPal
Deposit fees Interac e-Transfer: free
Transfers from another Coinbase account: free
EFT: variable
Withdrawal fees Interac e-Transfer / EFT / PayPal: variable
Transfers to another Coinbase account: free
Trading fees Maker fee: 0.05% - 0.6%
Taker fee: 0.00% - 0.4%

Best crypto exchange for high-volume day traders: Kraken

Kraken

270+
Supported cryptos
7
Fiat currencies
Kraken offers competitive fees, access to hundreds of cryptos, deeply liquid markets and advanced trading and charting features. With hundreds of USD-denominated trading pairs, Kraken is also widely regarded as one of the best exchanges for trading crypto with USD. According to CoinGecko, it's among the most trusted exchanges and its daily trading volume often exceeds US$500 million. Kraken Pro offers market and limit orders, and high-volume traders are rewarded with fee discounts as low as 0% for maker orders and 0.1% for taker orders.
Pros
  • Over 200 crypto assets and even more trading pairs
  • Discounted fees for high-volume traders
  • Highly-rated app for beginners and experts
  • Kraken Pro offers advanced charting tools and asset staking
  • 24/7 customer support
  • Filed for pre-registration with the Ontario Securities Commission
Cons
  • Fees can be high (but there are discounts for high-volume trades)
  • No margin or futures trading in Canada
  • Pro account verification can take days
Deposit methods Credit card, Cryptocurrency, Debit card, Interac e-Transfer, Wire transfer, Apple Pay, Google Pay
Deposit fees Interac e-Transfer: 0.5%
Apple Pay/Google Pay: variable
Crypto: Free for most cryptos
Wire transfers: $0-$3
Canada Post cash/debit: $1.25+0.25%
Withdrawal fees Interac e-Transfer: $10
EFT: 0.35%
Wire: $0-$35
Crypto: variable
Trading fees Maker (Pro account): 0%-0.25%
Taker (Pro account): 0.1%-0.4%

Best crypto day trading platform for the most supported coins: Bitget

Bitget

870+
Supported cryptos
45
Fiat currencies
Sign up and receive a 6,200 USDT newcomer's gift package.
We're impressed with Bitget's wide range of products and services—which include staking, NFTs, Web3 support and copy trading—plus its support for more than 800 coins. The platform is competitively priced for day traders, with maker fees ranging from 0.02-0.10% and taker fees ranging from 0.03-0.10%. Multiple payment methods are available as well as free deposits and instant buys, making Bitget convenient if you're looking to balance cost, convenience and asset access.
Pros
  • Access 800+ coins
  • Follow trades of more than 180,000 traders
  • Buy/sell NFTs and trade tokens via Bitget Wallet
  • Stake popular cryptos like SOL and ETH
  • Centralized and P2P marketplace
  • Bitget Card for VIP customers
Cons
  • Not yet regulated with the Canadian Securities Administrators (CSA)
Deposit methods Bank transfer, Credit card, Cryptocurrency, Debit card
Deposit fees None
Withdrawal fees Fees vary
Trading fees Maker: 0.02%-0.10%
Taker: 0.03%-0.10%
Advanced Trading Features Yes

Best for day trading crypto & fiat on a single platform: Uphold

Uphold

210+
Supported cryptos
20
Fiat currencies
Unlike most crypto platforms in Canada, Uphold lets you trade a wide range of cryptocurrencies and 25+ fiat currencies, including CAD, USD, GBP, JPY and AUD. You can also invest in precious metals like gold, silver, platinum and palladium. However, alongside increased asset flexibility, you'll face higher-than-usual fees and crypto-only withdrawals in Canada. But the convenience of accessing multiple asset classes on one platform could be worth the drawbacks for some investors.
Pros
  • Trade cryptos, fiat currencies and precious metals
  • Supports market and limit orders
  • Instant funding via debit/credit
  • Diversify your crypto holdings with Uphold Baskets
Cons
  • Uncompetitive fees
  • Only withdraw crypto in Canada
  • Uphold Crypto Card not available in Canada
  • Limited support options
Deposit methods Credit card, Debit card, Apple Pay, Google Pay
Deposit fees Fiat: 3.99%
Withdrawal fees Crypto: $0.99
Trading fees Trades under $500: $0.99 (plus spreads)

Best day trading platform for advanced order types: Crypto.com

Crypto.com App

370+
Supported cryptos
31
Fiat currencies
Crypto.com is a well-diversified platform for crypto newbies and experienced traders, with an NFT marketplace, a debit card for making fiat purchases with crypto and support for 350+ cryptos. As of the time of writing, Coingecko reports that the platform has more than 7.5 million monthly visits and an estimated daily trading volume of over $2 billion. The more you trade, the lower your maker/taker fees. Day traders will appreciate the desktop app's charting tools and advanced order types, including stop-Loss, take-profit and one-cancels-the-other (OCO) orders.
Pros
  • Wide selection of cryptos and order types
  • Staking and lending
  • Non-custodial DeFi wallet
  • Crypto.com debit card for everyday purchases
  • Streamlined NFTs purchases
  • Pre-registered with the Ontario Securities Commission
Cons
  • Higher fees on the app than on desktop
  • Limited NFT collections compared to larger marketplaces like OpenSea
Deposit methods Bank transfer, Credit card, Cryptocurrency, Debit card
Deposit fees $0
Withdrawal fees $1.99 per withdrawal ($0 for Prime members)
Trading fees Spreads: 0.01% – 0.08%
Taker fees: 0.05% – 0.075%
Maker fees: 0.06% – 0.075% (0% for Prime members trading more than US$10 million)
Advanced Trading Features Yes

Best regulated platform for day trading crypto: Bitbuy

Bitbuy Digital Currency Exchange

50+
Supported cryptos
1
Fiat currency
If you're looking for a regulated crypto platform that prioritizes security, Bitbuy stands out from the pack. It's the first crypto platform to become registered with the Canadian Securities Administrators (CSA), and it's also registered with the Ontario Securities Commission (OSC). Bitbuy is insured BitGo and keeps over 90% of its digital assets in cold storage. Additionally, users can enable extra optional security layers for their accounts.
Pros
  • Free deposits, free withdrawals via Interac e-Transfer
  • 90% of assets held in cold storage
  • Digital and cash assets are insured
  • Registered with FINTRAC, approved by the OSC and CSA
Cons
  • Only supports CAD fiat currency
  • No margin trading
Deposit methods Cryptocurrency, Interac e-Transfer, Wire transfer
Deposit fees Crypto: 0% (network fees apply)
Interac e-Transfer: 0%
Wire transfer: 0%
Withdrawal fees Crypto: varies
Interac e-Transfer: 0%
Bank deposit: 1.5%
Wire transfer: 1.5%
Trading fees Bitbuy trade: 0.5% - 1.85% spread
Bitbuy Pro: 0%-0.5% maker & taker fee

Best Canada-based broker for day trading crypto: Netcoins

Netcoins

40+
Supported cryptos
2
Fiat currencies
Vancouver-based Netcoins was founded in 2014. Unlike an exchange, which acts as a marketplace for buyers and sellers to transact, Netcoins is a broker that acts as an intermediary in crypto transactions. Fiat e-Transfers are free, and pricing is refreshingly simple at 0.5% on all trades (plus conversion spreads). Admittedly, you can pay lower fees with some competitors, but Netcoins is a solid option if you want a Canada-regulated exchange for crypto day trading.
Pros
  • Flat 0.5% trade fee (plus spreads)
  • Free e-Transfer deposits and withdrawals. Free crypto deposits.
  • Market and limit orders
  • Prepaid Mastercard with 1% BTC rewards for fiat purchases
  • Live chat, phone and email support
Cons
  • Limited number of cryptos
  • Fees for some bank wire transfers
  • No margin trading and you can only stake ATOM, ETH and SOL
Deposit methods Cryptocurrency, Interac e-Transfer, Bank Wire
Deposit fees Interac e-Transfer: Free (bank wires under $3,000 CAD are free)
Crypto: Free
Withdrawal fees Interac e-Transfer: Free
Crypto: Varies
Bank wire: Free for withdrawals over $25,000 CAD, otherwise $50 CAD
Trading fees 0.5% (plus spread)

Best for day trading crypto & stocks in a single app: Wealthsimple

Wealthsimple Crypto

60+
Supported cryptos
1
Fiat currency
While Wealthsimple Trade is designed for beginners and doesn't offer many advanced features, it is one of the few platforms that lets you trade both stocks and crypto in a single app. Access over 65 coins with trade minimums as low as $1, and pay 0.5%-2% on your trades. Wealthsimple is regulated by both the CSA and OSC and offers flexible customer support options if you need help.
Pros
  • No deposit or withdrawal fees
  • Beginner-friendly platform
  • Trade crypto, stocks and ETFs in the Wealthsimple app
  • Start with as little as $1
  • Customer support via chat, email and phone
Cons
  • Higher fees than some competitors
  • CAD is the only supported fiat currency
  • No futures, options or margin trading for crypto
  • Lacks advanced features
Deposit methods Cryptocurrency, Debit card, Interac e-Transfer, Wire transfer, Linked bank account, Bank transfer (EFT), Online wallet
Deposit fees None
Withdrawal fees None
Trading fees 0.5%-2%

Key takeaways

  • Day trading isn’t normally suitable for beginners.
  • Crypto is highly volatile, which makes it attractive to day traders but also high risk.
  • Cryptocurrency markets never close, which adds another level of complexity to day trading.

How to day trade crypto in Canada

To get started day trading crypto, you’ll need to have some experience investing, a clearly defined strategy and a crypto trading account.

  1. Research the risks. Crypto day trading isn’t appropriate for everyone. Do plenty of research to decide if it’s right for you, and only invest what you can afford to lose.
  2. Open an account with an exchange. Compare crypto trading platforms to find one that suits your needs. You’ll need to provide personal information and government-issued ID as part of the account registration process.
  3. Trade executions and position management. Before executing any crypto day trading strategies, it’s important to understand how to trade properly. Learn how to place different order types, such as market and limit orders, and how to manage your positions, including setting stop losses (if your exchange supports this feature) and taking profits.
  4. Develop a trading plan. A trading plan is essential for day trading crypto. This should include your trading strategy and risk management practices as well as entry and exit criteria. You should also set a maximum daily loss limit to help control your risk.
  5. Take breaks. Day trading can be mentally and emotionally exhausting, so make sure you take breaks and step away from the screen from time to time. This will help you stay focused and make better trading decisions.

What is crypto day trading?

Day trading or intraday trading is a style of trading that involves opening and closing positions within a single session. Originally used in traditional stock markets where trading was limited to business hours, day trading has now extended to cryptocurrency markets that operate round the clock.

Day traders use various strategies and setups to make multiple trades within a day, typically aiming to close all positions before the end of the session to avoid overnight risk.

How does crypto day trading work?

The objective of crypto day trading is to take advantage of intraday volatility and make a profit from short-term price movements. Investors rely on technical analysis, order flow and even news releases to inform their crypto day trading strategies and make trades.

Short-term traders, also known as scalpers, generally operate on low timeframe charts such as the 1-minute or the 5-minute. Lower timeframe charts provide a zoomed-in view of the market and can help traders execute with precision and capitalize on a wide variety of setups, including market imbalances, ranges and breakouts.

This trading style can be profitable but also carries significant risk. It requires knowledge, experience and discipline to become consistently profitable.

Crypto day trading platforms in Canada

1 - 5 of 10
Product GXFCY Deposit methods Fiat currencies Cryptocurrencies Offer Disclaimer
Uphold logo
Credit card, Debit card, Apple Pay, Google Pay

20

219

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Paybis logo
Bank transfer, Credit card, Debit card, Neteller, Skrill, Apple Pay

60

87

Use code Finder25 to get a 25% discount on all commission for 1 transaction. T&Cs apply.
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Kraken logo
Credit card, Cryptocurrency, Debit card, Interac e-Transfer, Wire transfer, Apple Pay, Google Pay

7

277

Certain trading features are limited or unavailable to residents of Ontario and Quebec.
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VirgoCX logo
Credit card, Cryptocurrency, Debit card, Interac e-Transfer, Wire transfer

2

78

Get a $20 bonus when you open a new account and deposit $100+. T&Cs apply.
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Bitget logo
Bank transfer, Credit card, Cryptocurrency, Debit card

45

874

Sign up and receive a 6,200 USDT newcomer's gift package.
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Crypto day trading strategies

There are countless day trading strategies and setups, and each trader has their preferred method. We’ve outlined five popular and potentially profitable crypto day trading strategies.

1. Range trading

When demonstrating setups, most traders will display high-volume breakout trades and drawn-out trends with high-percentage returns.

While these setups are great to know, the fact is that, most of the time, the market is not in an explosive phase of volatility but is instead in a period of accumulation or consolidation.

Although perhaps less aesthetically pleasing, accumulation phases and ranges can provide a way to profit and allow you easy entry into the market.

Identifying setups

Identifying ranges is straightforward and can be done by plotting out a parallel channel with several touches and rejections on either side.

Ranges can form on any timeframe from the 1-minute to the daily and be used with any trading style. While it’s good to monitor higher timeframes and understand what’s happening on a macro level, these examples will focus on day trading and scalping.

Things to look for when trading ranges
  • Consolidation. Ranges form during periods of consolidation and accumulation, as traders are uncertain when the next trend will form or breakout will occur.
  • Volume. Uncertainty and hesitation generally lead to low-volume zones. Traders short the tops and buy the bottoms of the range, biding their time before confirmation of a larger move.
  • Volatility. Ranges are defined by periods of low relative volatility and accumulation, which are natural parts of any market cycle.

Keep in mind that crypto markets are inherently volatile, so a “low-volatility” range can still be upwards of 10%. Always check the range width and adjust your position size and stop loss accordingly.

Crypto day trading strategies: range trading

The example above depicts a relatively low-volume trading range with multiple long and short entries. As volume increases towards the end of the range, the bottom level is broken and the market continues to the downside.

Trade execution

Executing range trades is relatively straightforward. By now, you should have drawn out your channel and will be ready to short tops and long bottoms.

As the market nears these levels, watch how the tape responds.

If orders are getting filled as usual and the order flow remains steady, you can start to add small size, set your stop loss and wait for a rejection to occur before pulling the trigger. However, if there is an influx of new volume and expansion candles, this could be a breakout developing. Be cautious and don’t rush into trades you hadn’t planned for.

If a boundary rejection does occur and the market is pushed back into the range, it’s time to execute your trade.

Size your position, set your stop loss and wait for the trade to play out.

Billy Endres's headshot
Our expert says

"Scale into your position slowly as the market reaches the top or bottom of the range. Picking exact tops and bottoms is extremely difficult, and scaling in will help you get a good average entry price. If the range is compromised and volume starts to flow into the market, you should have a stop loss ready to execute or, if time allows, position yourself for a breakout trade. However, be careful not to rush or FOMO into your next position—a well-planned trade is a well-executed trade."

Cryptocurrency writer

Trade management

Well-planned range trades can help you maximize profits and minimize risk. Let’s look at example setups, stop loss and profit target placement and introduce an important range trading consideration known as a wick-out.

Stop-loss placement

Placing a stop loss while range trading is fundamental. If the range is compromised and a breakout occurs, this will likely happen quickly and on high volume.

It’s better to get stopped out as soon as the breakout happens, rather than hesitating and getting caught offside.

Depending on whether it’s a long or short setup, stop losses should be placed above or below the range with enough room for wicks and small fakeouts.

Make sure you don’t position your stop loss too close to the range boundaries, as you will likely get wicked out.

Wicked out

Getting wicked out means your stop loss gets hit, only for the trade to then move in your favour. To help avoid unnecessary stop-outs, you can set a slightly looser stop and adjust your risk tolerance accordingly.

After the rejection is confirmed, you should consider moving your stop loss to break even or trailing it with the market. This will ensure you’re not out of the money if a large order comes through and momentum swings.

Crypto day trading strategies: getting wicked out

This image shows an example of a trade in which several wicks formed outside the range before being pushed back onside. This is why it is often best to scale into a small position (stopping out if needed) before entering with full size on confirmation of the rejection.

Profit taking

Once the rejection of the range boundary has been confirmed, you can sit tight and wait for the trade to play out.

Depending on your strategy, you can take profits at a fixed target or let the market run.

Ideal profit targets are midway to three-quarters through the range, but don’t get greedy—a win is a win.

Remember to scale out and lock in profits. It’s not uncommon for reversals to happen mid-way through trading zones.

Once you’ve locked in some profits, it can be a good idea to leave some size on your position or move your stop loss to break even.

If the market does reach the other side of the range, you can close the position or let it run into a potential breakout, depending on your strategy.

Crypto day trading strategies: profit taking

Although this is a clean range to trade, the entries are not perfect tops and bottoms. Scaling in and taking profits at about the midway point would have led to the most entries and successful trades.

Summary: Range trading

Range trading is one of the most popular crypto trading strategies used by both beginner and expert-level traders.

The market is often moving in a sideways direction and ranges are easy to identify. This means that you likely won’t have to spend too much time hunting for key levels or drawing out charting patterns.


2. Mean reversion

Mean reversion, otherwise known as fading, involves trading over extended moves with the intention of taking profit on a market correction or reversal back to the average value or mean.

Crypto day trading strategies: mean reversion

Identifying setups

Unlike range or breakout trades, the entry and exits on fade trades cannot be drawn out on a chart or plotted using technical analysis (TA).

That said, there are key signs to look for that can help identify mean reversion setups.

What to look for when fade trading
  • Over-extension. Over-extension is a qualitative assessment of the market and a matter of perspective. What looks like a hefty price spike on a 1-minute chart will often barely make a blip on the hourly. The only thing moving the market in either direction is the trader’s perception of fair market value—where do I buy or sell to make a profit? A good mean reversion trader understands market psychology. By identifying when other traders are likely to recognize the market as over-extended, they can capitalize and execute trades more confidently.
  • Volume. Volume is the most telling indicator. Over-extended moves can occur due to various factors, including a single large order being filled, a news announcement or a trendline breakout. Each of these will result in the volume telling a different story. When trading mean reversion, always look for hesitation vs. conviction.
  • Hesitation. If the market has spiked, but there is little follow-through in the form of volume, this demonstrates hesitation and uncertainty in the market. This is when you should take notice and start to plan your entry.
  • Conviction. If consistent volume flows into the market, it’s best to avoid fade trades altogether, as this often indicates the start of a new trend. High volume demonstrates that sentiment is strong in a single direction, and traders are confident that the market will reach its next support or resistance zone.
  • Volatility. Volatility is an important consideration when fade trading. You want to identify setups that are anomalies when compared with the average volatility throughout that trading session. If the market is ranging or trading on little volume, it’s likely that a fair price has already been identified and another trading strategy may be better utilized.

Crypto day trading strategies: when not to use mean reversion
Above is an example of a trade on Polygon (MATIC) when a mean reversion strategy would be a poor choice. There are consistent high-volume spikes, and the market is trending with conviction.

Trade execution

Executing the perfect mean reversion trade can be difficult. It involves shorting tops and buying bottoms without getting caught offside.

This is when identifying volume and market sentiment plays a crucial role. Remember, if volume is flowing into the market, steer clear until it subsides. Patience is key.

Consider entering with a reduced position size, and if volume flows back in, cut your loss. It’s less costly to re-enter a trade than to get caught offside—there’s no saying how far the market may move.

If the market starts to revert to the mean and your position moves into profit, you can add more size if you’re comfortable and your risk tolerance allows.

Trade management

Mean reversion positions are some of the most difficult to manage and master. In this section, we’ll cover how to place stop losses and profit targets. We’ll also provide tips for minimizing risk.

Stop-loss placement

Placing a stop loss for a fade trade is difficult, as there is no clear position like a range high or a key support level.

Stop-loss placement for this trading style is arbitrary and will take time to master.

However, as demonstrated on the Waves (WAVES) chart below, stop losses should generally be placed slightly above what you perceive to be the fullest extension of the move.

This may be where volume dies down, the market consolidates or wicks start forming, showing that traders are taking action and attempting to push the market back towards the mean.

Crypto day trading strategies: stop-loss placement in a mean reversion strategy

Billy Endres's headshot
Our expert says

"Once your trade is in profit, consider moving your stop loss to break even or trailing it with the market. Mean reversion trades happen with pace, especially on lower timeframes. If money starts flowing back in and the market shifts against you, it’s better to have locked in small profits than see a once profitable trade get stopped out for a loss."

Cryptocurrency writer
Profit taking

When trading mean reversion, lock in profits quickly. You will likely be trading higher-than-usual leverage, and it’s a good idea to get in and out as soon as it’s practicable.

It can also be a good idea to scale out of positions and incrementally take size off. Ideally, there will be a full reversion back to a profit target, such as a moving average. However, if (for example) you’re fading the breakout of a trend, the market may be pushed against you and eat away at your profits as the breakout is realized and sentiment shifts.

Summary: Mean reversion

Mean reversion is often associated with leveraged positions and fast-paced entries and exits.

In volatile crypto markets, these setups present themselves often, so there’s a good chance you won’t have to wait long for a setup.

However, always manage your risk appropriately, especially when trading leverage. Liquidation can happen extremely quickly when these setups don’t play out.

Taking losses is an inevitable part of trading, so make sure they are well calculated and accounted for as part of your trading plan.


3. Breakout trading

Breakout trading is a common strategy used by crypto day traders and scalpers to capitalize on market expansion and increased volatility.

Well-executed breakout trades can give you early access to a shift in momentum and allow you early entry to newly forming trends.

Identifying setups

Breakouts typically occur after a drawn-out range or period of accumulation. Volume is likely relatively low as traders wait for trend confirmation before entering with size.

Breakouts can occur on any timeframe from the 1-minute to the daily and can be used in combination with any trading style.

What to look for when trading breakouts
  • Consolidation. Watch for longer-than-average trading periods around range tops, bottoms or key structural zones.
  • Wicks. Wicks above or below a range or trading level indicate that sentiment is uncertain and a shift in momentum may come soon.
  • Volume. A significant increase in volume shows that there is a commitment by traders to buy or sell with size.

Trade execution

If the range or level is compromised and volume continues to flow into the market, look to execute your breakout trade.

Remember that breakouts are rarely clean, as traders often make a last-ditch effort to push the market back and fade the initial move.

If this happens, watch the tape closely, double-check your stop loss and prepare to take off some size if you’re uncertain.

If volume drops, it’s best to close a portion of your position and lock in some profit.

Remember, you can always get back into a trade. However, being in profit and then taking a hit isn’t great for your confidence or your account balance.

Crypto day trading strategies: breakout trading

Billy Endres's headshot
Our expert says

"Consider adding small size before the breakout confirmation. This can help you gauge where to place your stop loss and get a feel for the market. Opening a position can also be a confidence booster, you know you’re committed to the trade, focused and ready to execute."

Cryptocurrency writer

Trade management

In this section, we’ll explore the mechanics of breakout trading and provide some tips for minimizing risk and maximizing returns through well-planned profit-taking and stop-loss positioning.

Stop-loss placement

Placing a well-positioned stop loss is a crucial part of any breakout trade.

Although breakouts often look simple retrospectively, they are one of the most challenging setups to master.

If volume dies down and traders start closing positions, reversals can happen quickly, resulting in a fakeout. If you don’t have a stop loss set, you can quickly get caught offside and take a larger loss than you accounted for.

As shown in the chart below, stop losses for breakout trade setups are best placed inside the trading range or before the support or resistance level.

Crypto day trading strategies: stop-loss placement in breakout trading

If you’re holding a position of significant size, it may be worth placing multiple, smaller stop losses. This will decrease your chances of slippage if the trade goes against you; liquidity will likely be thin as many traders rush to exit the market.

Liquidity and slippage

Liquidity refers to the total value of resting bids and offers in the orderbook. If a market has low liquidity and you buy at market price or are stopped out of a trade, your order will be executed immediately at the “best available price.” If liquidity is low, the best available price may not be optimal, resulting in an instant offside trade or a larger-than-expected loss—this is known as slippage.

Profit taking

Once the breakout has been confirmed and an influx of volume has hit the market, the compromised level will ideally act as the new support or resistance zone.

Depending on your strategy, you can take profits at a fixed target or let the market run, remembering to scale out and take profits incrementally.

Trailing your stop loss is also a good idea, initially to break even and then to the previous swing high or low, depending on whether it’s a long or short setup.

Crypto day trading strategies: when breakout trading doesn't go as expected

Above is an example of a breakout trade that didn’t play out as expected. Despite all the signs pointing towards a clean breakout, the market was indecisive and a reversal or fakeout occurred. This is why taking profits along the way and after the initial breakout move can be a good idea.

Summary: Breakout trading

Well-executed breakout trades can result in high-percentage returns over a short period.

However, breakouts are not without risk. They can be hard to master, and getting caught offside in a fast-moving market can be costly. When first learning to trade breakouts, use small size and focus on correct position management and stop-loss placement.


4. Trend pullback trades

The pullback trade is a trend trading strategy that aims to pinpoint overpriced or underpriced entries. These trades are best executed by recognizing when the market has retraced to fair value and is likely to resume its trending state.

This strategy is well-suited to beginner and advanced crypto futures traders, as it can be used with high or low leverage and applies to different timeframes.

For this trade example, we will be scalping on the 1-minute chart using 3x Exponential Moving Averages (EMAs) to help with setup identification, trade execution and stop-loss placement.

We’ll use a longer-term EMA to gauge the underlying trend direction and two shorter-term EMAs to help monitor price swings and fair value.

Moving averages:

  1. 50 EMA
  2. 100 EMA
  3. 150 EMA

Combining these three moving averages will help eliminate market noise, identify trends and execute with precision.

Although you can adapt the EMAs and timeframes to your preference, always test new setups with small positions and low leverage to see what works best with your trading style and risk tolerance.

Things to look for when trading pullbacks

Trend consensus. This is the most important factor when trading pullbacks. You are trading with the trend, so make sure it is established and strong.

The moving averages should have formed a well-defined upward trajectory, pointing at about 45 degrees.

Crypto day trading strategies: trend pullback trades

Price action. The candles have been holding above all three EMAs. They will eventually reach a pivot point and start retracing.

Volume. There should be a consistent flow of volume throughout a trend. Avoid price spikes and low-volume periods—these setups are more suitable for mean reversion and breakout trades.

Recognizing fair value. The market will naturally move in ebbs and flows. To avoid buying the tops and selling the bottoms, you want to identify short-term weaknesses.

The candles will eventually retrace to the 50–100 EMA, indicating that the market is trading around fair value.

Recognizing these EMAs as a “fair value guide” is a great way to keep you out of the market during choppy periods and forces you to be patient and wait for the right time to enter.

Support and resistance zones. You want to look for a pullback that tags the 50 or 100 EMA without breaking down the 150-period moving average.

The 150 EMA will act as a support or resistance zone—as long as it remains intact, so will the trend.

Crypto day trading strategies: support and resistance zones

Trade execution

Now that you’ve identified setups, it’s time to start planning your execution.

You want to look for a long or short opportunity in the direction of the established trend.

  1. All three moving averages are trading in consensus. They should be close to parallel on a 30-60 degree slope.
  2. Candles pull back and test the 50 or 100 EMA. It may consolidate around this region for a while. This is perfectly normal, as even clean trends have bumps and flat spots.
  3. Wait for price action confirmation. Volume should start to flow back into the market and push it in the direction of the prevailing trend.

Once confirmed, it’s time to execute your pullback trade.

You can scale in slowly or add size as the market moves in your favour.

Be mindful of market volatility. Depending on the timeframe you’re trading and the relative volatility of the trading pair, price swings can differ drastically.

Size your positions accordingly, stick with your trading plan and don’t over-leverage.

Pullback trades are common in crypto futures markets, as there’s often a trading pair experiencing a trend day and increased volatility.

Practice using a small account balance and low leverage. Once you’ve got a feel for the pullback trade, you can begin to size up your positions and increase leverage.

Trade management

In this section, we’ll explore the various types of trend pullback trades and provide you with risk management and profit taking strategies to help capitalize on them.

Stop-loss placement

Stop-loss placement for pullback EMA trades is relatively straightforward.

Although the primary purpose of the 150-period moving average is to act as a guide to display the underlying trend, it also makes for an ideal stop-loss zone for both long and short setups.

The 150 EMA will typically be around the swing highs/lows, meaning that, if this zone is broken down, the trend may end and the trade setup is likely to be void. The trade setup below shows where a stop loss would have been triggered following the breakdown of all three moving averages.

Crypto day trading strategies: stop-loss placement in trend pullback trades

If you want an even more precise placement, draw out a trend line that touches the swing candles’ tops or bottoms, depending on whether it’s a long or short trade.

This line should be relatively close to the 150 EMA. Position your stop slightly below the trend line, remembering to account for wicks.

Crypto day trading strategies: using a trend line for stop-loss placement

Profit taking

When trading pullbacks, there is no right or wrong way to take profit.

Depending on your strategy, you may prefer to lock in profits as soon as there is a high-volume push toward the prevailing trend or to scale out slowly as the market moves in your favour.

Fixed targets and Fibonacci retracements are also commonly used. However, they can be challenging to plan during fast-moving scalping setups.

To avoid unnecessary losses, consider moving your stop to break even as soon as it’s practicable, or set a trailing stop loss if the crypto exchange supports this feature.

Crypto day trading strategies: profit taking in trend pullback trades

In the example above (trading a pullback setup), you could trail your stop with each swing high, remaining in the trade, adding size and taking profits on multiple occasions before eventually being stopped out.

Summary: Trend pullback trading

The pullback trade is one of the best strategies for developing your scalping and crypto day trading arsenal.

Identifying setups is relatively simple when using the three EMAs, which also help with stop-loss positioning and precision executions.

Trade setups are frequent, especially on lower time frames, so you’ll never be on the sidelines long when trading pullbacks.

The main risk when trading on low timeframes is the fast pace of the market and the use of high leverage that it often comes with.

If you’re uncomfortable with charts as low as the 1-minute, consider moving to the 5- or 15-minute timeframes.

Trades will come around less often, but a slightly higher timeframe is a good starting point for feeling out the pullback trade and will give you more time to plan your entries.


5. Support and resistance trades

It’s crucial to understand and recognize market behaviour and price action around support and resistance zones. These zones form on all timeframes and are one of the most recognizable setups due to the market’s natural behaviour to retest key levels.

Identifying setups

When trading support and resistance, it can be worth zooming out to a higher timeframe. Levels that form on higher time frames are often stronger, as there will likely be institutional money being traded here and an increased effort to defend price.

Things to look for when trading support and resistance
  • Support and resistance vs. ranges. Although similar, support and resistance levels should not be confused with ranges. Unlike ranges, support and resistance always form in a horizontal manner. There may be no clear parallel channel to take profits, which can make exiting a position tricky.
  • Key levels. Levels of support and resistance form around areas of previous market activity. This may be a higher timeframe zone (where the market has bounced or been rejected) or a key psychological level (such as $1.00 or $10,000).
  • Zones. Zones can be drawn out by identifying support and resistance levels that the market has tested and rejected on several occasions.
  • Price action. When trading support and resistance, watch for wicks around significant levels. Wicks show signs of price weakness and low conviction. A zone breakout is less likely if the price has quickly been rejected. Keep in mind wicks are often pushed outside the zone. The trade remains valid as long as the market doesn’t hold outside the support or resistance level.

Crypto day trading strategies: support and resistance trades

Trade execution

Once you’ve plotted out your support and resistance zones and identified a potential setup, it’s time to execute.

Trade executions will vary depending on multiple factors, including your trading timeframe, account size and risk tolerance. Depending on liquidity, you can enter a trade through a single market order or numerous limit orders.

Trade management

In this section, we’ll delve into the trade management of support and resistance setups and demonstrate profit-taking and stop-loss positioning.

Stop-loss placement

Positioning stop losses for support and resistance trades is not difficult if your zones are drawn out correctly.

If you’re trading short, place your stop loss outside the resistance high, remembering to account for wicks to the upside.

If you’re holding a long trade, position your stop below the support zone, accounting for wicks and potential price spikes to the downside.

Support and resistance levels are often volatile, as some traders are looking to play a breakout while others are fading the move back into the zone. Sometimes it’s best to have a looser stop and lower leverage to avoid wick outs. Once the trade moves in your favour, trailing your stop loss may be a good idea, as it can be hard to position a fixed profit.

Crypto day trading strategies: stop-loss placement in support and resistance trades

Profit taking

The optimal place to take profits when trading support and resistance can be confusing and is a topic for debate.

While there is no “perfect exit,” it can be helpful to take profits incrementally. By closing a portion of your position quickly, you will reduce the risk of an offside trade and can choose to hold for a longer period.

If you’re a risk-averse trader, trailing your stop loss can help. This will allow you to see your position and profit margin at all times, which is important for a confident trading mindset.

Summary: Support and resistance trading

Support and resistance identification is crucial to trading, whether or not you use it as a strategy. The market is in a state of flux most of the time, and recognizing when and why can help identify all sorts of setups, including breakouts and accumulation phases.

Support and resistance levels develop on all timeframes, so you’re sure to find a position quickly. However, if the timeframe is higher, the level will likely be stronger and more recognizable.

When trading around support and resistance zones, the primary considerations are patience and risk management.

Entering a trade too early before the test of a level can result in a poor risk-to-reward ratio and eat away at your profit margins.

Risk management is especially important when trading these setups. Because you’re trading around key levels, the market can break out unexpectedly and quickly. Make sure your stop loss is well placed and your position is sized according to recent volatility.


Is crypto day trading safe?

Day trading crypto is a high-risk, fast-paced style of trading that is not appropriate for everyone. Before starting day trading, make sure you’re familiar with the markets and, ideally, have a demo or simulation account to practice trading on a reputable crypto exchange.

This manner of trading is particularly risky if you’re using leverage, which can amplify profits and losses. The prices of coins and tokens can also fluctuate rapidly—sometimes within minutes or seconds—making it highly unpredictable.

Day traders aim to profit from these price movements, but they must also be aware of the potential risks of losing money very quickly.

By following proper risk management strategies, including using stop-loss orders and limiting position sizes and leverage, crypto day traders can reduce risk and increase their chance of success.

It is essential to thoroughly research and understand the risks involved in day trading and develop a sound strategy before you begin.

Pros and cons of crypto day trading

Before you get started with any kind of crypto day trading, make sure you’ve carefully weighed the pros and cons.

Pros

  • 24/7 market. The cryptocurrency market operates 24/7, providing traders with continuous opportunities to monitor the charts.
  • High volatility. Due to the high volatility of cryptocurrencies, day trading allows investors to capitalize on frequent price fluctuations.
  • Immediate results. Short-term traders can see the results of their trades quickly, as positions are opened and closed within the same session.
  • Flexibility. Crypto day trading can be done from anywhere in the world, as long as you have a laptop and internet connection.
  • Access to information. Trade-related data is openly available on most exchanges without the need to pay fees to access order books or technical information.

Cons

  • High risk. Day trading often involves using leverage, a high-risk approach that can result in amplified losses if the market moves against you. Start with a small account balance and size up incrementally.
  • High stress. Day trading requires constant market monitoring, which can be stressful and emotionally fatiguing. Because the market operates around the clock, crypto day traders also risk losing sleep, which can have a negative impact on their health and wellbeing.
  • Potential fraud and scams. The cryptocurrency market is largely unregulated, making it vulnerable to scams and fraud. For added peace of mind, choose a crypto day trading exchange that is registered with your provincial or territorial securities regulator or the national Canadian Securities Administrators (CSA).
  • Trading fees. Frequently opening and closing positions during the day can result in the accumulation of high commissions.
  • Taxes may apply. All realized crypto gains and losses must be reported to the Canada Revenue Agency each financial year. Keeping a trading diary or using specialist crypto tax software is especially important for high-frequency day traders.

Bottom line

Day trading crypto lets traders profit from market volatility, but it’s a high-risk approach to trading. It requires a lot of knowledge, experience and discipline to be successful and isn’t suitable for everyone. Novices should learn the basics of trading before attempting to day trade crypto.

Proper risk management strategies, including using a reputable crypto exchange, are essential and can help increase your chances of success. However, crypto day traders must always be aware of various factors, including high commissions, liquidations and fatigue.

FAQs

Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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To make sure you get accurate and helpful information, this guide has been edited by Elizabeth Barry as part of our fact-checking process.
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Written by

Cryptocurrency writer

Billy Endres was a cryptocurrency writer for Finder. His background in software development helped open the door to the world of decentralised technologies, financial markets and technical writing. See full bio

Billy's expertise
Billy has written 9 Finder guides across topics including:
  • Web3 and decentralised technologies
  • Front-end development
  • Cryptocurrency futures trading and technical analysis
  • DeFi and on-chain analysis

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