Scalp trading is a dynamic trading strategy that puts the emphasis on swift, short-duration trades, targeting small price fluctuations. We have already concluded that scalp trading and the cryptocurrency markets are almost a match made in heaven, due to the 24/7 nature and high volatility of the crypto markets. However, because cryptocurrencies vary so much, potential scalp traders often wonder which cryptos are best for scalp trading.
This article aims to answer this question by examining the top choices for traders interested in crypto scalp trading. We will evaluate factors such as liquidity, volatility, trading volume, and overall market demand to identify the most promising options.
Key highlights:
- Scalp trading emphasizes swift execution and short-duration trades to capitalize effectively on cryptocurrency market volatility.
- Optimal cryptocurrency selection involves prioritizing high liquidity and volatile coins, ensuring quick transactions with minimal impact on prices and ample opportunities for scalp trades.
- Scalpers should conduct thorough research, continuously monitor the market, and implement strategic risk mitigation strategies to enhance scalp trading outcomes.
How to select the best coins for scalping?
The best cryptocurrencies for scalping are those that combine high liquidity with significant volatility. This ensures ample trading opportunities and allows for quick entry and exit from trades without significantly impacting the market price. Generally, the top 20 coins (excluding stablecoins) have high liquidity and sufficient volatility, making them ideal for scalping. The same applies to high market cap coins and major altcoins.
Read more: What Is Scalping in Crypto: Pros, Cons, and Strategies
Avoid illiquid small-cap coins with large spreads. Beginner scalpers should focus on the top 20 coins by market capitalization. Additionally, when selecting the perfect cryptocurrency for scalping, consider transaction costs, technical indicators, and the impact and availability of news events. It is also crucial to choose cryptocurrency exchanges with low trading fees, as high fees can significantly reduce your scalping profits.
The 6 top cryptos to scalp: Examining the best cryptocurrencies for scalp trading
In this article, we will focus on high market cap coins with highly liquid and sufficiently volatile markets, including Bitcoin, Ethereum, BNB, Ripple, MATIC, and Dogecoin. Please note that manual scalp trading can be very difficult, which is why using crypto trading bots is becoming increasingly popular among scalp traders.
1. Bitcoin (BTC):
- Market capitalization: $1.20 trillion (#1)
- Average daily volume in June 2024: $94.5 billion
- 30-day volatility: 5.00%
Bitcoin, the first cryptocurrency, is among the most popular choices for scalp traders due to its high liquidity, substantial trading volumes, and established market presence. Its price can be highly volatile, offering numerous opportunities for traders to capitalize on short-term fluctuations. Moreover, Bitcoin's widespread availability across most exchanges ensures easy access and is thereby suitable for most scalp trading strategies. These characteristics make Bitcoin one of the best cryptos for day trading as well.
2. Ethereum (ETH)
- Market capitalization: $398 billion (#2)
- Average daily volume in June 2024: $18.1 billion
- 30-day volatility: 3.65%
Ethereum, the second-largest cryptocurrency by market capitalization, is a top choice for scalp traders. Its advanced smart contract capabilities provide diverse trading opportunities. With a vast ecosystem of decentralized applications (DApps) and tokens on its blockchain, Ethereum benefits from high trading volumes and liquidity. The significant volatility in its price movements makes it particularly well-suited for scalp trading strategies. However, traders should closely monitor news and developments related to Ethereum projects, as these can rapidly influence the market in either direction.
3. BNB (BNB)
- Market capitalization: $82.4 billion (#4)
- Average daily volume in June 2024: $1.76 billion
- 30-day volatility: 6.88%
As the native cryptocurrency of Binance, a premier crypto exchange, BNB has become a favorite among scalp traders. Despite Binance's recent legal challenges with the SEC and a significant fine, BNB remains a reliable large-cap crypto with notable volatility. BNB offers several benefits to its holders, including lower trading fees, which are crucial for effective scalp trading strategies. With the ongoing growth and adoption of Binance and its ecosystem, BNB has experienced significant increases in trading volume and liquidity, providing ample opportunities for scalping.
4. XRP (XRP)
- Market capitalization: $26.0 billion (#8)
- Average daily volume in June 2024: $1.38 billion
- 30-day volatility: 3.15%
XRP, renowned for its fast, low-cost cross-border payment solutions and ISO 20022 compatibility, has become a leading cryptocurrency for scalp trading. With a large market cap and widespread support on major exchanges, XRP offers numerous trading opportunities. Its price movements are often driven by partnerships and collaborations, allowing scalp traders to take advantage of short-term fluctuations. However, as the market matures, XRP's volatility is gradually decreasing.
5. Dogecoin (DOGE)
- Market capitalization: $17.2 billion (#9)
- Average daily volume in June 2024: $54.85 billion
- 30-day volatility: 9.93%
Despite starting as a meme coin, Dogecoin has evolved into a prominent and fully functioning blockchain and cryptocurrency. Its high volatility and active trading community result in frequent price fluctuations, providing ample opportunities for scalping. The dog meme-inspired cryptocurrency has seen numerous ups and downs, often influenced by Elon Musk's interest in DOGE. While technical analysis is essential for profitable scalp trading, it is therefore also crucial to monitor Musk's posts on X.
6. Polygon (MATIC)
- Market capitalization: $4.3 billion (#23)
- Average daily volume in June 2024: $1.28 billion
- 30-day volatility: 9.32%
Polygon stands out as one of Ethereum's most successful layer-2 scaling solutions. Utilizing proof-of-stake (PoS) and plasma frameworks, Polygon facilitates faster and more cost-effective transactions than the Ethereum mainnet. Its interoperability with Ethereum and other blockchains, coupled with a robust ecosystem, cements its position as a key player in blockchain adoption. MATIC's high volatility and lower transaction costs make it particularly well-suited for scalp trading in the cryptocurrency market.
The Bottom Line
Choosing the best cryptocurrencies for scalp trading depends on your scalp trading strategy. While this article highlights some top choices, it's crucial to conduct thorough research, monitor market trends, and stay updated with the latest news and developments.
Scalp trading involves significant risks, so implementing proper risk management strategies and trading responsibly is essential. Technical tools like trend lines and candlestick patterns can help identify and analyze price movements effectively.
Whether focusing on the top 20 cryptocurrencies or cryptos with a lower market capitalization, developing a robust trading plan and using technical and fundamental analysis will maximize scalp trading profits. For those comfortable with higher risk, exploring low market cap cryptocurrencies with bullish potential can enhance daily returns.
