The exchange rate at the parallel market fell to another new 3-year low on Friday closing at N465/$1. However, on the officially recognized NAFEX Market, the Forex turnover was somewhat stable with only a slight drop of 0.08% on Friday as the exchange rate was weakened to N387/$1.    

Parallel Market: At the black market where forex is traded unofficially, the Naira depreciated by N2 to a dollar to  close at N465 to a dollar on Friday, as against the N463 to a dollar on Thursday, another new 3-year low for the Naira. The exchange rate at the beginning of the week was N461 to a dollar. The drop is due to pressure on the black market as a result of scarcity of dollars, especially at the official. This has made most businesses to source for their foreign exchange at the black market. 

NAFEX:  The Naira depreciated against the  dollar at the Investors and Exporters (I&E) window on Friday, closing at N387 to a dollar, compared to the N386.50 that was reported on Thursday, July 9, representing a 50 kobo drop. This is as traders are still confused over CBN’s adjustment of the exchange rate at the SMIS window. The opening indicative rate was N386.13 to a dollar on Friday. This represents an 83 kobo gain when compared to the N386.96 to a dollar that was recorded on Thursday.  

READ MORE: World Bank says Nigerian banks are at risk of being destabilised by COVID-19

Nigeria maintains multiple exchange rates comprising the CBN official rate, the BDC rates, SMIS, and the NAFEX (I&E window). Nairametrics reported last week that the government has set plans in motion to unify the multiple exchange rates in line with requirements from the World Bank. Nigeria is seeking a world bank loan of up to $3 billion. The country has been under pressure from the International Monetary Fund and the World Bank for currency reforms.  

Forex Turnover      

Meanwhile, forex turnover at the Investor and Exporters (I&E) window was somewhat stable on Friday, July 10, 2020, as it dropped by an insignificant 0.08% a day on day. According to the data tracked by Nairametrics, forex turnover slightly dropped from $25.19 million on Thursday, July 9, 2020, to $25.17 million on Friday, July 10, 2020. The low turnover is an indication of the liquidity pressure in the foreign exchange market and a far cry from an average of $200 million recorded at major trading days during the last few weeks.    

Rate Adjustment    

Nairametrics reported last week that the CBN official rate has been adjusted from N360 to a dollar to N381 as reflected on the website of the FMDQ.  However, the confusion in the forex market still persists as official rate quoted on the website of the CBN remains at N360/$1.    

According to Bloomberg, “Nigeria quietly devalued its official exchange rate last week, a nod to IMF suggestions that foreign investors would appreciate the unification of a currency that has traded at multiple rates for five years. In the event, the handling of the 5.5% devaluation of N381 per dollar still served to sow confusion. The Central bank hasn’t announced the change and is yet to adjust the rate on its website.’’       

READ MORE: Analysts predict outlook for naira as forex unification plans gain momentum

What this means: Unifying the Naira around the NAFEX rate is effectively another round of devaluation. If this is carried out and forex liquidity improves, then it could lead to an exchange rate being strengthened in the parallel market just like it occurred in 2017.    

The parallel market rate is currently N465/$1 and could converge to the NAFEX rate, meaning those who bought above the black market rate could lose money if they sell.  

The country’s monetary authority had imposed multiple exchange rates to manage dollar demand after oil prices crashed, but dollar shortages which have become prevalent stifles growth in the economy.  

According to a report from Nairametrics, the Manufacturers Association of Nigeria (MAN), has expressed its support to the recent CBN’s exchange rate unification drive. They said that this will boost investor confidence and enable stable planned production for the manufacturers thereby leading to economic growth in the country. 

This, however, contradicts the views of the Nigeria Employers’ Consultative Association (NECA), who does not support the exchange rate adjustment at the SMIS window as it will lead to inflation. They believe that the rate adjustment is badly timed and counterproductive, as the nation depends a lot on importation of raw materials, equipment and petroleum products. This will lead to higher cost of all imported goods.  

A BTC trader is simply an individual who seeks gains from differential changes in the market price of BTCs. The main objective the BTC trader has in mind is buying prices at low and selling when the flagship currency gains higher. BTC trading can thus be very lucrative and has become one of the fastest-growing careers in the financial spectrum. 

Data obtained from a leading BTC analytic firm, Coinmarketcap showed that the market capitalization of BTC currently stands at over $170 billion. This further illustrates that in 2013 BTC moved from $13.30 to its present-day value of over $9000, meaning that early bird BTC traders had gained over 67,600% since it began. 

Consequently, this article will show major steps that are needed if you want to become a successful BTC trader. 

Explore Research Data From Nairametrics by Visiting Nairalytics

Self-Control & Discipline  

Adebayo Juwon, an FTX consultant for Africa, spoke to Nairametrics in an exclusive interview, explaining in detail the need for a BTC trader to be very disciplined and have a security-conscious mindset. He said; 

“Firstly I must note that trading is not for everyone, to be a successful crypto trader, self-discipline is a prerequisite to achieving one’s goal. The crypto market is very much volatile than what the traditional traders are used to, hence more risk and reward. 

“A crypto trader must be security conscious; you’re responsible for your account security in the crypto ecosystem, as hackers are preying on whose account is less secured.” 

READ ALSO: CBN provides guidelines to address credit, liquidity risks, others  

Risk Management 

A successful BTC trader must be able to understand the relationship between reward and risk management. This entails high understanding levels about the degree of randomness in BTC market and the risk involved in taking such risk. As a successful BTC trader, you are required to understand when its best to trade BTC as market conditions change from time to time. 

Adebayo Juwon, FTX consultant for Africa also added vital points on why a BTC trader should never ignore risk management. He said; 

“Also, to be a successful crypto trader, one must have good risk management in place, in a highly volatile market your profits can be zapped away in minutes. Risk comes in different ways in the crypto market, there are lots of scam projects with the good marketing team, they tend to attract investors also, it’s very important to do your own research in the crypto space, and rely less on market sentiment.” 

READ MORE: Tether mints 80,000,000 USDT to unknown wallets within 24 hours

Timing 

Recall that some days ago Nairametrics, revealed the best time many BTC traders prefer to take their trading positions in the BTC market, thus preferring to trade around the American trading session because of the high price swings that occur at the start of New York stock market trading time -about 2.30 pm GMT. This means there were higher chances of making more money at the start of  American trading sessions than other trading sessions (London and Asian trading session).  

Basic fundamental and Technical analysis skills 

Every successful BTC trader must keep track of macro fundamentals going around the BTC community because such information more often determines the market price of Bitcoin.  Either rumours or news have exponential effects on the BTC market and often create lucrative trading opportunities. 

Chris Ani, a professional BTC trader in a phone chat interview explained to Nairametrics in detail, the major attribute every successful BTC trader must possess, including the need to have basic trading skills. He said; 

 “To prevent yourself from becoming a slave to the market, you must be trading small enough size on your trades that you are not emotionally attached to them. Trading opportunities wait for no one. 

“You have no idea when and where they will appear. Whenever they appear, you have to be ready with your trading plan.  You must also master technical and fundamental analysis and most importantly the one that works for me, understand the seasons and market structure so as to know when to trade, allow big wins run, or rather exit the market in order not to lose your money.” 

Finally, it’s very important to understand that no matter how good you get at BTC trading, you will often make mistakes and lose money. Always remember, trades that go bad are part of what will make you successful in the long term. Success in BTC trading simply means you are winning more relatively than losing. 

The race for the fastest growing crypto asset of all time keeps changing constantly in the present crypto landscape as Elrond is by far the best performing digital coin among the top 100 crypto assets in recent times. Elrond has skyrocketed by over 1,735.54% since its inception of trading at the crypto market. 

 Shortly after the official statement released by its developers, on its integration, Elrond price blew up the charts lately presently it trades at $ 0.011931, up 1,735.54% since it’s in inception in Aug 2019 when it began trading at $0.002. The exponential increase facilitated this fast-growing digital coin move up to 58th position in terms of market capitalization size. Data obtained from Coinmarketcap, showed its market capitalization was over $157.2 million at the time this report was drafted.

Explore Research Data From Nairametrics by Visiting Nairalytics

Quick fact; Elrond is a type of blockchain architecture, created to facilitate a 1000-fold cumulative improvement in the execution of speed. Its architecture combines a Secure Proof of Stake (PoS) algorithm facilitating unlimited scalability. Elrond is originally designed to facilitate the process of over 10,000 transactions per second at cheap cost and with 5-second latency attempting to become the backbone of borderless, permissionless, and globally accessible internet economy. 

In addition, Beniamin Mincu, Elrond CEO explained in detail how the Elrond blockchain is perfectly positioned to deliver the needed responsiveness and scale. He said; 

READ MORE: Safest, regulated Cryptocurrency, Arcoin backed by U.S. Treasury securities

“Getting access to all the available liquidity from day 1 is an important prerequisite for anyone building DeFi tools. This integration enables Elrond to be part of many existing cross-chain DeFi applications. We’re excited to work with Swingby and increase access to Elrond’s highly scalable and cost-effective solution,” Mincu said.