While US equities have been notable for their lack of volatility, they have still gained over 4% for the start of the year. Admittedly they have not seen the swings of 2015, or 2008, but for those prepared to identify a trend and jump on opportunities as they arise, the possibility to find profitable trades still exists, for example, with S&P 500.
Or, for example, let’s look at the Australian dollar. Against the US dollar, or AUD/USD as it’s known, it has rallied by 2%, around 150 points since 9 January. Even at 100p per point, on an account of say £2000, that is still a return of 7% in the space of a few days.
The problem with volatility is a psychological one. It may seem fun to be trading something that can see swings of 10% or more in the space of 24 hours. But this can lead to rash decisions, perhaps exiting winning trades too early, and thus giving up potential profit, or closing out trades at a small loss when they move against you, rather than following correct risk management procedures and letting the stop do the work for you (assuming you have followed the rule of keeping trades small relative to you overall account size).
For those used to the stomach-churning swings in the price of cryptocurrencies, the examples above may seem tame. But they offer the chance to place trades that do not require such feats of mental endurance. Trading is all about having a process, and not deviating from that, and wild markets such as bitcoin can lead traders to do rash things that they may regret.
There is plenty of movement in most major assets, so it may pay to look beyond cryptocurrencies to other markets.