Trading cryptocurrencies requires understanding the characteristics of tokens that can be active or inactive. Experts highlight the importance of selecting an appropriate strategy based on market conditions.
What is Active Trading?
Active trading involves tokens that are trending, highly volatile, and showing strong momentum in either direction. For example, HYPE is expanding rapidly and offers fertile ground for high-risk strategies.
Characteristics of Inactive Tokens
Inactive tokens are consolidating or accumulating with no clear trend. For instance, ENA, in analysts' view, is currently not showing significant movement and does not provide quick trading opportunities.
Trading Strategies for Active and Inactive Tokens
Analyst Sherpa cautions against using high leverage on ENA at its current levels. He advises betting on long-term fundamentals for less volatile tokens, while active tokens require more aggressive approaches. 'I prefer to use leverage on assets that are already moving,' he added.
Understanding the differences between active and inactive tokens allows traders to adapt their strategies accordingly. It is important to be patient with inactive tokens and seize opportunities in active ones in line with market conditions.
