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Knowing the fundamentals of swing trading is enough to make a profit.

But sometimes you need a bit more of an edge to really take advantage of the market.

However, higher profits usually come with greater risks.

Leverage is essentially borrowing money to increase your position size.

This can increase your gains, but will also increase your losses.

If you choose to use leverage, it is best to keep it low. No more than 5x.

And don’t forget your risk management. Always use a stop loss and never invest more than you can afford to lose. Be sure to take into account the leverage when calculating possible loss.

Arbitrage is when you take advantage of the price differences between markets. For example, if you buy an asset on Binance and then sell it for a higher price on Kraken.

However, it is not just a straight buy and sell. You must take into account fees and transfer times.

Other advanced types of arbitrage include triangular arbitrage and statistical arbitrage.

Triangular arbitrage is using three markets to profit: A to B, B to C, and C back to A.

Statistical arbitrage uses mathematical models to identify and exploit price differences.

A final type of arbitrage in crypto is funding rate arbitrage. This is done by capitalizing on the differences in funding rates between different cryptocurrency exchanges.

Arbitrage is considered low-risk but requires a lot of capital to make any real money. Retail traders should focus on major mispricing to benefit from this strategy.

Correlation trading is buying and selling two related assets based on the relationship between their price movements.

For example, many coins move in tandem with Bitcoin.

Pair trading is buying one asset and selling a related one at the same time to profit from the relative price changes between the two.

Another use case of correlation is to diversify by holding multiple assets with low correlation. That way, when one drops in price it does not affect your whole portfolio.

Market and limit orders are the two fundamental order types.

A market order is a request to buy or sell an asset immediately at the best available current price.

A limit order is a request to buy or sell an asset at a specific price or better, which means the trade will only happen if the market reaches that price.

A stop-limit order is a two-part order that becomes a limit order once a specified stop price is reached. This allows you to set a price to buy or sell after a market movement. This can be helpful in volatile markets, such as crypto.

Trailing stop orders will automatically update your stop loss as the asset price moves in your favor.

Advanced technical analysis uses more complicated mathematical models to predict asset movements.

Elliot Wave Theory follows a five-wave pattern in the direction of the main trend, followed by a three-wave correction.

Using Fibonacci ratios can offer you precise entry and exit points.

Volume profile research can help you identify support and resistance levels.

Intermarket analysis examines links between separate asset classes (crypto, stocks, forex, etc.)

As you learn more trading techniques, it is easy to overcomplicate your trading strategy.

Leverage can heighten emotion and advanced strategies can lead to analysis paralysis.

If you do decide to delve into these advanced strategies, do it slowly. And remember, more often than not, simplicity is best.

Read the next chapter here.

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