Source

Question 1

DEFINE IN YOUR OWN WORDS WHAT TRADING IS,WHAT IT'S FUNCTION IS AND HOW IT RELATES TO THE CRYPTOCURRENCY MARKET

DEFINITION OF TRADING

Trading in it's simple term means buying or selling of commodities, securities or services. In trading exchange is carried out,and it usually involves two parties.

FUNCTION OF TRADING AND HOW IT RELATES TO THE CRYPTOCURRENCY MARKET.

In cryptocurrency market, trading is the act of buying and/or selling cryptocurrency. This is done by understanding the movement of the Crypto market and predicting price movements of the market before purchasing or selling a particular cryptocurrency.

The cryptocurrency markets are decentralized by nature. In order for a trader to have access into the market to trade he/she needs to have an exchange account that would enable him/her buy and/or sell cryptocurrencies . If purchased,there's need for the trader to have a Crypto wallet where he/she stores crypto assets for further trade or accumulation of profits.

Crypto exchanges facilitates crypto trading. They permit exchange of cryptocurrencies(e.g: from BTC to ETH) ,they also permit buying and selling of coins and as well as the purchase of Crypto with Fiat money.

The rate of cryptocurrency generally depends on activities of buyers and sellers,there's a range of other factors that affect the cryptocurrency price but trading directly affects the demand and supply of it,which in turn affects the crypto market.

QUESTION 2

DEFINE AND EXPLAIN WHAT ARE THE TOOLS USED FOR TRADING (Technical Analysis and Fundamental Analysis) AND AT LEAST ONE EXAMPLE OF EACH.

• Technical Analysis:

This can be defined as the prediction of financial price movements,it is the forecasting of futuristic price change by careful examination of previous price movements.

Source

Source

Results gotten from this analysis is not absolute in telling future price movements,but it can help investors have a little idea of how the market will behave in the nearer future.

Source

• Example: Technical analysis is best for traders,for instance; if I have some USDT and I want to buy some Doge coins with it, technical analysis demands that I should be able to know if it's safe to buy or sell at the moment by checking and critically observing the nearer previous actions of the price of Doge coin.

Fundamental Analysis:

This can be explained as the study that is concerned with factors that might likely affect the price of stock, cryptocurrency,etc in the future. This form of analysis is best for long term investments.

QUESTION 3

Name at least 3 cryptocurrency exchanges with the highest trading volume where we can buy our first cryptocurrencies and explain in your words the ways to buy cryptocurrencies on at least one of these platforms.

CRYPTOCURRENCY EXCHANGES WITH THE HIGHEST TRADING VOLUME ACCORDING TO COINMARKETCAP.COM

NAME	VOLUME(24H)
Binance	$10,135,265,700(-24.94%)
Huobi Global	$2,610,095,084(-33.65%)
Coinbase Exchange	$1,155,173,602(-36.7%)
FTX	$795,681,830(-27.47%)
Kraken	$501,802,329(-36.86%)
Kucoin	$516,484,876(-26%)
Bithumb	$859,411,132(-18.38%)

HOW TO PURCHASE CRYPTOCURRENCY FROM COINBASE EXCHANGE USING A BROWSER

• First thing to do is to sign in to coinbase
• Click on "buy/sell" on the upper right-hand side of the platform.
• Click on the "buy Field" to choose what you'd like to buy.
• Put in the amount you want to buy, either in cryptocurrency or local currency.
• Select the payment method you want to use.
• Click on "preview buy" to confirm your transaction.
• After previewing your transaction,if it's correct then go ahead and click on "buy" to complete it.

NOTE: There's and arrow that when clicked on,takes you back in case of a need for correction. And if you want to make the transaction you just made recurring one,click on "one time purchase" and select the amount of times you'd like it to repeat.

CONCLUSION

Trading is one aspect of crypto involvement that makes so much sense to me. I trade on binance,and it's been productive so far. I believe if you are able to calm down and understand the market flow of these currencies,one would really make the most out of it.

Thanks for this wonderful class,hope my homework meets your standards.