They say “Buy the dip and sell the moon”. In crypto nobody knows when the coin value surges. But when it does and if you feel your investment or mining revenue has been doubled then take necessary action and make some profits. Because you’ll never know when the coin will moon again.
When trading cryptocurrencies; volume is one of the most important metric which you must analyze. By observing the coin’s trading volume you’ll understand the price swings and the direction of a coin. There are other metrics as well which helps you to decide whether you should be investing in a project or not. For more information check this post which explains cryptocurrency market cap, supply and volume. So why volume is more important for trading cryptocurrencies?
Cryptocurrency trading volume
Trading volume tells us the price movements of a coin. Before the value of a coin soars; the one that shows huge signs is its trading volume. If a coin shows a heavy trading volume; it means a lots of people are interested in trading that coin. Hence as the volume goes up the price of the coin also follows. If the volume drops; it means only less people back the trend and hence the price of the cryptocurrency also drops gradually. There are no certainties but by effectively examining the trading volume you can predict the price movements.
Volume is nothing but a total amount of the transactions that occurred in a certain period of time. The trading volume of each individual cryptocurrency differs. Similarly each and every single exchange shows different trading volume for different coins. Most cryptocurrency exchanges display 24 hour volume which is the total sum of the transaction (including buying and selling) that occurred in that particular exchange for that particular time period. Volume determines the stability, viability and credibility of the exchange platform and with more volume it will be easy for you to liquidate.
Let’s assume you bought some coins worth $50000 when the price was low. Now as the value raised you may wish to sell some coins and get back your $50000 immediately. For this the exchange where you wish to sell must have enough trading volume. If the exchange has low volume then you need to wait for a long time to get your order filled. The higher the volume; it will be easy for you to get in an get out. With lower volume it will be harder for you to cash out. So to trade cryptocurrencies it is essential that you choose an exchange that most are familiar with and has the biggest trading volume.
Before we can examine which exchange has what volume we need to first find out all the exchanges where the coin which you are interested in is being traded.
Finding cryptocurrency exchange with most volume
Buying and selling Bitcoin is very easy because almost all exchanges have Bitcoin listed. They are paired with both Fiat money and Altcoins. Similarly Ethereum, ADA, BNB, DOT, Litecoin, Dash, EOS and most top cryptocurrencies can also be acquired and traded easily. But this is not the case with every other altcoins.
Coins that are less popular and have low market cap can only be found on exchanges that are less popular. Finding such exchanges may seem quite difficult. Here let’s see how to find an exchange where a certain coin or token is being traded.
There are certain cryptocurrency data websites which in order to display the price of a cryptocurrency it fetches exchanges rates. One such website is CoinMarketCap which calculates the price of coin reported by each market. This website keeps track of all exchanges where the coin or token trades and also displays exchange volume for a particular coin.
Coin exchange list and their volume
Head to coin market cap, choose a coin and navigate to markets section. It shows the list of all exchanges where the coin trades, their volume and in what currency pair they are being traded. This section displays both CEX and DEX (Decentralized Exchange).
Most cryptocurrency exchanges are geographically targeted and the volume of an exchange reveals where most buyers and sellers are at. For example Bithumb is the top exchange by volume where Monero is begin traded. Since it is a leading South Korean cryptocurrency exchange; Monero is traded in South Korean Won. Followed by Bithumb is Binance where XMR is largely traded with BTC pair. Next there is Bitfinix where a large number of users are trading with XMR/USD pair.
This is just an example and in CoinMarketCap you can find the exchange listing and their volume for almost every altcoins. But do note that the data displayed in CMC is only for last 24 hours and these data are not updated in real-time. Also the price of the coin fluctuates frequently and each exchanges have slightly different prices. So before you start trading; check exchanges manually and head to the one that has the most trading volume and has your favorite currency pair.
In most exchanges the 24 hour trading volume are displayed in BTC. If you want to know the value in USD or EUR you can use our BTC conversion tool.
Similar to Coin Market Cap you also have Coingecko: https://www.coingecko.com
Also you can use the following website which shows top Bitcoin exchanges based on trading volume: http://data.bitcoinity.org/markets/volume/
Alright! But what about coins that are not listed on Coinmarketcap or Coingecko?
Tips to trade safely
Most new Altcoins and small cap cryptocurrencies will take some time to get listed on exchanges. When it gets listed it will be usually mentioned in the Bitcoin forum announcement page, altcoin sub reddit and at the coins official website.
But keep in mind that the price and volume of such low cap coins can be easily inflated. So be cautious when trading such coins. Do not send a large amount of coins to unknown exchange even if the volume is high and never hold your coins in an exchange for a long period of time. Once you are done trading move your coins off the exchange. Also remember that cryptocurrencies are highly volatile. So DYOR and invest cautiously.