How to Choose the Best Cryptocurrency Pairs to Trade?

Nowadays, there is an overwhelming number of digital assets available for trading in crypto markets. These thousands of assets have different prices, trading volumes, and market cap, as well as different popularity among traders/investors. 

There are several factors involved during crypto trading, especially market fluctuations, liquidity, trading fees, platform fees, and more. Therefore, before you buy bitcoin and other cryptocurrencies, you must be aware of them.

Hence, it is crucial for traders/investors that enter the cryptocurrency market to perform an in-depth analysis of what the best options are and how it is possible to seize profitable trading opportunities with them. 

In this article, you will find out techniques to choose the best cryptocurrency pairs to trade. 

Technical Analysis – Is It Necessary for Cryptocurrency Trading? 

Similar to traditional stock markets, traders/investors in the crypto industry can benefit a lot from performing technical analysis of several cryptocurrency pairs to understand the most profitable trends and overall market behavior. 

Firstly, it is necessary to be realistic. Many traders spend days assessing a thousand pairs when in reality only a dozen of the options would be actually profitable. This way, it is crucial to be precise and do not waste time with unprofitable possibilities. 

Nonetheless, fundamental and technical analysis cannot be done without someone engaging in trading, especially as investors/traders need to choose a trading pair to start their activities. 

Hence, it is crucial to notice that before trying to apply technical analysis to trading, it is necessary to select the right trading pair. For example, when the BTC dominance and BTC price are stagnant, it’s clever to trade BTC pairs, since you can accumulate more for the run-up.

Popularity Matters – Assessing How Popular a Trading Pair Is and Why It is Important 

When choosing a cryptocurrency pair for trading, it is essential to assess how popular a pair is before definitely sticking with it. Popularity matters, not only because the most traded pair represents the hottest market trend, but because it indicates high liquidity. 

Currently, the most popular trading pairs in crypto exchanges can be divided into two distinct categories – crypto-to-fiat pairs and crypto-to-crypto pairs. In essence, the most popular tend to involve combinations between Bitcoin (BTC), Ethereum (ETH), Binance Coin (BNB), Litecoin (LTC), and Tether (UDST).

But why choosing the most popular pairs can be a good thing? Would not it be a type of “herd effect”? Indeed, it is not always ideal to follow the masses, but the most popular pairs in several exchanges mean that there is a global demand for those specific assets.

Consequently, it means that traders/investors can easily find buyers whenever they want, which exponentially increases the chances to find profitable opportunities. 

Also, checking the trading volume of different assets and then check their connection with different assets is a good strategy for those who do not want to follow the major-crypto-asset trend. 

The Liquidity Factor 

When speaking about any type of financial operation, liquidity is a primary and crucial parameter for decision-making. In layman’s terms, liquidity refers to the ability traders/investors have to sell assets quickly.

Hence, the higher the liquidity in a specific market, the more opportunities traders/investors have to sell their assets for profit. It is impossible to dissociate liquidity and profit, as the liquidity level in a trading pair is what determines the profit from each negotiation. 

Plus, healthy levels of liquidity mean lower risk for operations. This way, if a certain trading pair always have people willing to buy and sell their assets, traders/investors will not lose following a bearish trend.

The supply-and-demand for a certain digital asset also affects its liquidity. When the demand for a cryptocurrency is low, traders/investors have to establish lower exchange rates to make it less unattractive to potential buyers. 

Once again, it explains why cryptocurrencies such as BTC, ETH, USDT, BNB, and LTC are leading choices when it comes to trading pairs, as these are assets that have solid and ever-growing liquidity. 

Assessing the Past Performance of Trading Pairs 

In a market so volatile as the cryptocurrency market, it is important to analyze history to find valuable conclusions about the present and future. 

It is crucial to take a look back and assess the performance of the best cryptocurrency trading pairs. This strategy allows traders/investors to choose the right pairs based on technical analysis, market sentiment, and asset comparison.


When choosing a trading pair, it is essential to evaluate all the factors involved in a potential trade, including market volatility, liquidity, and profit rates. 

Also, it is crucial to check what options your exchange of choice allows you to use as the base currency. Currently, the most profitable trading pairs involve BTC, ETH, LTC, USDT, and BNB. 

Every year, new digital assets are releases, some projects are born, and many of these projects fail to stay active while others thrive to reach the top of the chain. Hence, it is possible to forecast the performance of certain assets by analyzing the performance of similar assets in the past.


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Written by Virily Editor

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