Day trading cryptocurrencies has become a popular way for traders to take advantage of the fast-paced and volatile nature of the crypto market. However, with thousands of cryptocurrencies available, choosing the best crypto to day trade can be a daunting task.
In this article, we will analyze the top choices for traders looking to engage in crypto day trading. We'll consider factors such as liquidity, volatility, trading volume, and overall market demand to identify the most promising options.
Key highlights:
- Day trading cryptocurrencies leverages the market's volatility and liquidity for profit opportunities, but selecting the right crypto is critical.
- Important factors for choosing a day-trading cryptocurrency include high liquidity, substantial trading volume, and market depth.
- Stablecoins like Tether and USDC are vital for efficient value transfer between coins and exchanges in day trading.
- Bitcoin and Ethereum are preferred for conservative day trading due to their stability, while Dogecoin suits high-risk, high-reward strategies.
How to selectthe best cryptos for day trading
There is no silver bullet when it comes to selecting the best day trading crypto coins. However, it’s generally accepted that there are certain properties that make a cryptocurrency a good digital asset to day trade – these include:
- Volatility: Can be beneficial for day traders as rapid price fluctuations offer more opportunities for buying and selling.Higher volatility can provide more trading opportunities but also increases the risk. But make sure to calculate your crypto position size so that you don't exceed your trading budget.
- Liquidity: Highly liquid crypto assets allow for faster execution of trades and tighter bid-ask spreads.It's generally recommended to choose cryptocurrencies with sufficient liquidity for day trading.
- Trading volume: Higher trading volume indicates more active market participation, making it easier to enter and exit trades quickly. Adequate trading volume is essential for efficient day trading.
- Market depth: A deeper market indicates a more liquid and active market, allowing for larger trade sizes without significantly affecting prices and slippage risks.
- Exchange availability: A cryptocurrency being available on as many exchanges as possible means higher volume, which is a major plus for day traders.
- Market cap: An established crypto is safer to trade and less likely to suddenly plunge in value than low market cap coins. However, lower market cap coins can be a good option for traders who don't want very risky trades.
With these factors in mind, let’s examine our top cryptocurrency day trading picks based on the above criteria.
| Cryptocurrency | Market Cap | Avg. Daily Volume (May ‘24) | Total Volume (May ‘24) | 30-day volatility | Exchange listings |
|---|---|---|---|---|---|
| Bitcoin | $1.26 trillion | $103.50 billion | $3.10 trillion | 2.4% | 136 |
| Ethereum | $419 billion | $21.35 billion | $640 billion | 3.0% | 130 |
| Solana | $59.2 billion | $5.54 billion | $166 billion | 7.5% | 87 |
| XRP | $27.2 billion | $2.04 billion | $61.7 billion | 3.7% | 102 |
| BNB | $86.3 billion | $1.63 billion | $48.8 billion | 5.6% | 84 |
| Tron | $10.8 billion | $1.39 billion | $41.8 billion | 2.0% | 103 |
| Dogecoin | $17.9 billion | $1.28 billion | $38.4 billion | 9.5% | 101 |
| Near | $5.70 billion | $835 million | $25.1 billion | 14.5% | 66 |
| Chainlink | $8.45 billion | $820 million | $24.6 billion | 7.8% | 98 |
Includes data from the 1st to 31stMay 2024.
It is worth noting that having access to liquidity via stablecoins is very important for anyone who wants to day trade, as they allow quick transfer of value between various coins and exchanges. The two most popular stablecoins in terms of trading volume last month were Tether and USDC.
The 9 best cryptos to day trade: Examining the best coins for day trading
What are the best cryptos to trade with high frequency depends on your preference. If you prefer high-risk, high-reward trades, then choosing the most volatile crypto for day trading, such as Dogecoin, might be a good choice for you. If you prefer a more conservative approach, then coins that are more stable, like Bitcoin and Ethereum, will serve you better. Consult the sections below to find the right day trading cryptocurrency for you.
If you're looking to get into crypto day trading, it's important to choose a trading platform with high liquidity and low trading fees. Make sure to check out our list of the best crypto exchanges for day trading to learn more.
1. Bitcoin (BTC)
Average daily volume in May2024: $103.5billion
30-day volatility:2.4%
Bitcoin, the pioneering cryptocurrency, remains the go-to choice for many day traders. It boasts high liquidity, large trading volumes, and a well-established market. Bitcoin's price movements can be highly volatile, providing ample opportunities for day traders to profit from short-term price fluctuations. Additionally, the availability of Bitcoin trading pairs on most exchanges makes it easily accessible for day trading strategies.
2. Ethereum (ETH)
Average daily volume in May2024: $21.4billion
30-day volatility: 3.0%
Ethereum, the second-largest cryptocurrency by market capitalization, is another top choice for day traders. Known for its smart contract functionality, Ethereum offers a wide range of trading opportunities. The cryptocurrency has a robust ecosystem with numerous decentralized applications (DApps) and tokens built on its blockchain, resulting in high trading volumes and liquidity. Ethereum's price movements often exhibit significant volatility, making it attractive for day trading strategies.
3. Solana (SOL)
Average daily volume in May2024: $5.54 billion
30-day volatility: 7.5%
Solana is a highly efficientblockchain platform with the capability to execute smart contracts. Since its introduction n 2020, Solana has gradually established itself as a serious to Ethereum in the realm of smart contracts. Solana integrates the Proof-of-Stake consensus mechanism combination with pioneering features like Proof-of-History, which allow it to efficiently process thousands of transactions per second while simultaneously maintaining low costs for users.
Solana is one of the most widely adopted blockchain platforms and is seeing usage across diverse sector, ranging from decentralized finance and stablecoins to NFTs and blockchain gaming.
4. XRP (XRP)
Average daily volume in May2024:$2.04 billion
30-day volatility: 3.7%
XRP, known for its fast and low-cost cross-border payment solutions, has established itself as one of the top cryptocurrencies for day trading. The cryptocurrency has a large market cap and is widely supported on major exchanges. XRP's price movements can be influenced by various partnerships and collaborations, creating potential opportunities for day traders to capitalize on short-term price fluctuations.
5. BNB (BNB)
Average daily volume in May2024: $1.51 billion
30-day volatility: 8.9%
As the native cryptocurrency of Binance, one of the best crypto exchanges, BNB has gained considerable popularity among day traders. BNB offers various benefits, including reduced trading fees and participation in token sales on the Binance Launchpad platform. With the increasing adoption of Binance and its ecosystem, BNB has seen significant growth in trading volume and liquidity, providing traders with ample opportunities for day trading.
6. Tron (TRX)
Average daily volume in May2024: $1.39billion
30-day volatility: 2.0%
Tron is one of the most popular cryptocurrencies among day traders thanks to its wide availability across virtually all crypto exchanges and deep liquidity. In fact, TRX's volume tracked by CoinCodex regularly surpasses $1 billion, making it one of the seven cryptocurrencies (other than stablecoin and wrapped assets) to break the ten-figure dollar mark. It's worth noting that TRX is a very affordable option for transferring crypto due to low fees, which makes it one of the most popular ways to transfer USDT, the largest stablecoin in the market.
7. Dogecoin (DOGE)
Average daily volume in May2024: $1.28 billion
30-day volatility: 9.5%
Despite starting as a meme coin, Dogecoin has established itself as a prominent cryptocurrency for day trading. Its high volatility and active trading community have led to frequent price fluctuations, presenting opportunities for traders to profit from short-term price movements. The dog meme-inspired cryptocurrency has had plenty of ups and downs in the past, plenty of which connected to Elon Musk and his fascination with DOGE.
8. Near (NEAR)
Average daily volume in May2024: $835 million
30-day volatility: 14.5%
Near is the native token of the layer 1 network called NEAR Protocol, which is a direct competitor to other layer 1s like Ethereum and Solana. Near is particularly attractive to day traders since it has a lot of volume, is available on dozens of exchanges, and has one of the highest volatility indexes out of all major cryptos. This makes it perfectly suited for employing day trading strategies.
9. Chainlink (LINK)
Average daily volume in May2024: $820 million
30-day volatility: 7.8%
Chainlink is an interesting addition to the top traded coins in the past month. When we last updated this article with data for February 2024, LINK didn't even crack the list of the top 20 most traded coins. In May 2024, LINK rose to the top 10 most traded coins, beating out coins like Polygon, Litecoin, Avalanche, Bitcoin Cash, and Cardano. High volatility and daily average volume are certainly factors that have contributed to LINK's rise in popularity.
The bottom line: What’s the best day trading crypto option depends on your trading profile
When it comes to day trading cryptocurrencies, choosing the right assets is crucial for success. While this article has highlighted some of the top choices for day traders, it's essential to conduct thorough research, monitor market trends, and stay updated with the latest news and developments.
Remember, day trading involves risks, and it's important to implement proper risk management strategies and trade responsibly. Also, crypto day traders, like forex investors, can benefit from using trend lines to identify and analyze price movement trends
Whether you decide to focus on Bitcoin, Ethereum, XRP, or any other cryptocurrencies, developing a solid trading plan and employing effective technical and fundamental analysis will be key to maximizing your day trading profits. If you don’t mind additional risks when day trading, you can try to find low market cap cryptos that show bullish promise to potentially amplify your day-to-day returns.
