SteemitCryptoAcademy Season 2 week 3: Homework post for @stream4u

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Warm greetings to everyone visiting this post. It's another week and as usual I'm also here to try and complete my homework task from the lecture by @stream4u.
I'll go straight and deal with the tasks.

What is Crypto Margin Trading?

The term, in the simplest of ways can mean, making multiple, huge or numerous profits just by investing less. This actually happens when one gets a loan or borrows funds from a third party, particularly, from exchange platforms or other investors to make an investment which promises huge profits. Let's say you do not have sufficient funds to undertake your investment, crypto margin can actually help in increasing your buying power so that you can make the investment you seek or simply, a good investment.
The third party responsible for lending you the funds can offer capital to its investors of about x1 to x100 to make the investment and this solely depends on the strength of the third party or lender.
Since everything has its own disadvantages, crypto margin trading can either end up in a loss or great profit which makes it quite risky(everything can be lost in the long run, no profits whatsoever).
One should also know that, when the margin is x20, it means you can purchase an item which is worth 20times the money or funds you have currently.
Let's cite this example, let's say I got $1,000 on me and want to trade. Then I go in for a leverage loan of x5 which actually means I will get $5,000 and when that is added to the one I already had which is $1000, I'm gonna get $6,000 which will really help me trade more since I have more capital now.
If a 10% profit was made, it will be multiplied by the 5 which will give me 15% profit; it's the same for when losses are made. This makes it quite risky like I said earlier, but when you make profits, it's actually jackpot for you!

HOW TO PLAN FOR TRADING IN CRYPTO MARGIN TRADING

Since the main aim of an investor is to make profits in the long run, there are some things that can help in making your trading a success. There can still be losses but these suggestions listed below can actually help the loss rate.

  • First and foremost, knowing about what you are doing is very important. It's always better to have a fair idea about margin trading before venturing; this can actually save you your impending losses. You can't just start trading because you saw someone doing same or someone telling you about it without you knowing absolutely nothing about it.

  • Also, aside the point stated above, it is also essential to have a little bit of experience about the crypto margin trading before going into it because there are some techniques and steps needed in dealing with it. An amateur can't do that.

  • It's normal and good to be optimistic about everything but when dealing with the crypto margin trading, everything should be expected because it works both sides; it's either you win or lose. So you can make losses too and this should be expected. You have to get knowledge of the risk involved in what you are doing or about to do.

  • The funds you are going to invest shouldn't be one which can cause grievous losses in your normal funds when you lose it. Since there can be losses and profits, it is advisable to go it with money that you can afford to lose.

  • With the experience part, you have to be able to at least predict the prices of the crypto assets required by the one investing.

  • It is also advisable to start with a small amount of money and not all your capital just to test the waters.

  • You shouldn't be greedy or selfish. An investor must leave the trade when he feels or sees he has made the profits he wanted, else everything can change in a moment and end in losses.

  • Lastly, you have to have knowledge about the charges in the particular trade.

Crypto Exchanges Name That Provide Margin Trading Service and What Margin They Provide.

Below are some of the crypto exchanges that provide margin trading and the margin they provide.

  • Bybit: This provides a 100x margin with very low fees(most preferred by many)
  • Binance exchange: provides a leverage of 1-125x.
  • Deribit: this provides 100x leverage
  • Huobi: huobi provides 3x leverage
  • Kraken: provides 5x leverage
  • poloniex: provides 5x leverage

What is Leveraged Token Trading?

Leveraged tokens are type of crypto assets but they cannot be contained or saved in your cypto wallet.
This type of trading works when the third party or the exchange platform gives out a service to a price of crypto asset and this actually helps improve the profit that you'll gain form that trade.
This actually means that, in this type of trading, tokens are lent out by margin, to investors with the goal of achieving enormous or big profits. One good thing about this trading is that, it promises more profits than losses. However, since precise technical analysis are required to deal in it, it is essential for investors to have experience or to be well-versed in it before venturing.
Here are some of the examples of the tokens that are used and their trend;

BULL Toro which operates in an uptrend or upward trend.
BEAR Bear and it operates on the downtrend or downward trend.
HEDGE Hedging, a token in which a negative margin is used.
HALF Half, a token that uses a positive margin.

How To Plan For Trading In Leveraged Tokens

Just as there are rules in everything before you can succeed, there are some things you have to do before trading in leveraged tokens.
Below are some suggestions on how to plan for trading in Leveraged Tokens. It's just like the first one.

  • Firstly, as proposed by the lecturer himself in the lecture, it's better to start or invest with a small amount of money and not the whole of your capital.
  • Also, since this is a risky thing, one must have a fair idea or experience in crypto trading before trying to trade.
  • An investor must have knowledge about the trend type to use in the trading and also be able to predict the price of the crypto assets to be traded.
  • Since this trading works both ways, an investor must be ready for anything, whether a loss or a profit eventhough profit is what is actually needed.
  • An investor should not exhibit the act of greed and should know when to exit the trading because it can end in losses if care is not taken. cryptotrading can be unpredictable sometimes.
  • It is also better and advisable to find exchange platforms with relatively low fees for transactions so that interest paid on your borrowed funds can be reduced as compared to others.

Crypto Exchange Name That Provides Leveraged Tokens Service and The Respective Margins They Provide In Leveraged Tokens.

We have

  • KuCoin: it provides a margin of leverage of up to x10
  • Huobit: provides a margin of leverage of up to x5
  • FTX: provides a margin of leverage of x3
  • Kraken: provides a margin of leverage of x5.

Price Forecast for Crypto Assets BTC/USD

In my case, I'll consider BTC/USD.
In recent weeks, we have seen BTC go down and then increased again.

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As it can be seen, this is the current price f bitcoin which is quite impressive.

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The bar on top indicates the resistance level and the one below indicates the support level.

For the prediction, I can only say I'm a newbie when it comes to cryptocurrencies and trading and all the stuff associated with it and still learning.

However, my prediction for the price of BTC for the coming week is that it will see a small spike, not a very huge one. This is due to the fact that, it's obvious most investors will turn to it to trade and invest into this crypto asset more as usual which will bring about a slight increment which is no news to cryptotraders because BTC has had a very huge value before than now.
The price of BTC as this time I'm writing this post is $57,026.90 and I see it moving to $57,500.00 in the coming week. This is just my humble opinion or prediction.

CONCLUSION

As we all know it, trading in cryptocurrencies in general is not really an easy thing. It's always better to get experience before trying to go into it. You can however get help from veterans like our noble crypto professors who keep helping us and opening our eyes in such a manner.
I' grateful to @stream4u for his work and I hope this work I've done will be commended. However, I accept any criticisms and corrections.
I just hope my work will be reviewed and commended.
Thanks for your attention, I appreciate it.

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