In this lecture, the professor explained the his order book in a simplest way. I am going to write this week homework task for professor @yousafharoonkhan.

What is meant by order book and how crypto order book differs from our local market. explain with examples (answer must be written in own words, copy paste or from other source copy will be not accepted)

We buy or sell the assets in the crypto world. All the records of those buy and selling transaction are kept in an order. These are the orders of sell and purchase of assets and a record of these orders are kept in a book which is known as order book. These orders are recorded in record book by the traders. These records are written in record book by the investors at their own suitable price. This book helps the people to get to know what is the market trend. The crypto order book give us the information How much coins are being buy or being sell by traders at which price.

The difference between crypto order book and order book of local market
In crypto world, the coins are purchased and sell by the traders. The traders enter in the crypto world and perform the transactions. We just perform analyzes to predict future of any coin and invest there. But we cannot touch the items in the order book of crypto currency neither we are able to see those items. But the people go to the local market in case of buying the items such as potato, cloth, etc. All the items in local market are tangible and the customer can see them.

The crypto order book is different from the local order book because here, the records are recorded in book in form of pairs. For example, if i want to sell ETH for buying the BTC, this activity will be recorded in the sell section of order book. In other case, if i want to buy the Tron for BTC, then this record will be entered in the buy section of order book Tron/BTC. But this not happened in local market, here you can buy and sell the items using the single currency/coin.

The crypto order book provide you the facility of trading(purchase/sell) a coin with multiple pairs of currencies. But in local market, you have to pay the local currency for the items you bought.

When you enter in the local market, a lot of sellers are there which are selling the same item but at different rate. These rates are set by the sellers. The customers are mostly bound to purchase at the rate which is determine by the seller. But this not happen usually in crypto world. When you enter in crypto market, the normal person have the right to set the price in the order book of crypto currency.

In local market. mostly the price of an item remain same for some period of time(months). The volatility in price is not much high. But We know that the crypto world is highly volatile. Here the prices of coins are changed within minutes/hours.

In local market , the prices are set by the seller but still they have to set them at a specific time. They cannot change the price at any time. But in crypto record book, you are free to fix the coin price at any time.

In digital market, when you perform the transaction, you also need to pay some transaction fee there. This transaction fee is also added when you set the price in crypto order book. But when you buy or sell anything in local market, you do not need to pay the transaction fee here.

There is no option of stop limit orders in local market. They people are not facilitated with such features while in crypto order book, these features are available to the traders.

The prices in local market are set by the seller at a specific time. But we are not able to predict what will be the future price of any item in local market. There is no tool or strategy to analyze the future of any item price. But in digital world, as we know that multiple tools and techniques are used for analyzing the future of a coin/asset/currency.

Local Market order book	Crypto Market order book
No buy or sell in pairs	Buy or sell the items in pair
No much volatility in price of items	The Prices of items are highly volatile.
The prices are mostly fixed by sellers	Normal people have the ability to set price

No need to pay the fee for buying or selling goods	Have to pay the transaction fee to perform the transaction
There is a specific time when the seller fix the items price	The prices of currencies are change every minutes/hours
There is no stop limit order feature	Have the Stop limit order feature.

Explain how to find order book in any exchange through screenshot and also describe every step with text and also explain the words that are given below.(Answer must be written in own words)

Pairs
Support and Resistance
Limit Order
market order

Here i will show you how we can find order book on the Binance exchange as i am using this exchange from starting. Here are few steps.

Login to your Binance account.

Click on wallet

Click on Fiat and Spot

Search the coin which order book you want to find. I searched the STEEM

Click on trade button. Click on the pair you want; BTC/Steem ,ETH/Steem

The Below is the order book of the pair BTC/

Trading Pair

When two currencies are paired together and are able to trade for each other on any exchange platform( such as Binance Houbi, etc) these are known a trading pair in crypto world. The pairs may be formed of crypto-2-crypto(BTC/ETH) or crypto-2-fiat(BTC/USD). These pairs are available to to traders and they trade these coins of a pair for each other. Such as there is a pair Steem/ETH. You are able to buy the steem for ethereum or ethereum for steem. You can also sell the steem for ethereum or ethereum for steem.

Support and Resistance

We know that crypto world is highly volatile. The trends of market change every time. The price of an asset goes up and down. The support level is a spot where the downtrend of an asset is expected to stop. It is also known as the best buy position. When the traders sees that the price of a coin goes decrease, they start buying the coin at low price and get the full advantage of that downtrend. The price of that coin start rising by more investment by the trader in that coin. So we can say that support level is a point which safe the coin from further downtrend. It is the top of downtrend. This give a purchase signal

The second term is Resistance level. It is the term we oftenly hear in digital world. The resistance level refer to the point where the uptrend of any assets is expected to pause. It mean that the down trend of that coin is going to start. When the coin rise to a certain level, the investors start selling their coin to get good profit. The investment decreases and the downtrend started over there. It is the top of uptrend. This give a sell signal

These both direct the trader to predict what will be the future of market. When to enter and when to exit from market. When we see the crypto order book, the mostly sell coin position is marked as resistance level and mostly buy coin position is marked as support level.

Limit order

When the buyers or sellers place the order to buy or sell any coin at any specific price(not according to the current market price), it known as the limit order. Limit orders are refer to the orders which are entered into the crypto order book at a certain price by buyer or seller when they place order to buy or sell an asset. Let suppose i have an Ethereum and i want to sell this coin in market. Let suppose the market price of ETH is 20000 but i want to sell it at 30000. I will set the price limit to 30000. This known as the order limit where the limit of price is set by the seller/buyer. This coin will sell once the ETH will rise to 30000. Same if i want to buy an Ethereum coin. The market price of this coin is 20000 but i want to buy it at 15000. I set the price limit of ETH to 150000. This is known as limit order and this order will be run once the ethereum price decrease to 15000.

In limit order, you set the limit price of any coin. The order is execute once the price of that coin reach to the level which you set.

Market order.

Above we talked about the limit order where the buy/sell order is placed at the price different from market price. The market order is opposite to that. When the seller or buyer place the order to buy or sell a coin at the market price, it refer to the market order. This sort of the orders are performed fastly because no need to wait for a specific change in market price. The order is place and there are many people who are willing to pay you at the spot for your coin at the market price. For example, i have ETH and i want to sell it. The market price is 20000. If i placed the sell order, many people will be there who will purchase this coin at this price. This sort of orders are executed fastly.

Explain the important future of order book with the help of screenshot. In the meantime, a screenshot of your exchange account verified profile should appear (Answer must be written in own words)

Let me show you first the screen short of my verified Binance account.

The main feature of the order book is that the transactions are performed here in form of pairs. The crypto record book keep the record of all the buy/sell transactions. The order book also keep the record of the price, market supply, capitalization of each transacted pair.

Let me clear this answere with help of a pair, Steem/BTC.
I login to my binance wallet

I click on the wallet button

I select The Fait and Spot option

I I type there Steem

Select the option of your own choice from Steem/BTC or Steem/ETH. For example i go with Steem/BTC

The order book of the Steem/BTC will be open

The order book will show you the change(with respect to % and unit) in the pair price.

The order book show you the which pair which this order book recorded. It shows you the last 24 hour low and high price of this coin. The order book shows you the current market price of this pair

The order book shows us the current price of crypto pair and the price at which the buyers or sellers are buying or selling the pair. The order book show you the buy order(limit order) with color green and sell order(limit order) as red. These buy/sell orders are listed in ascending order.

The chart is available in origional view, trading view and in depth.

The graph shows in the order book can be schedule according to you. It mean that you can schedule it by 1 week, 1 day, 4 hours, 1 hour, 15 minutes.

The trades which are placed by traders are also mentioned there.

If you want to buy/sell a pair fastly, you will go with the market order

If you want to sell/buy the crypto pair at a price which is less/high from the current market price, the you will click on the limit order button. Whne you want to save yourself from any loss, you select the Stop limit section. It refer to when you sell/purchase a pair when its price reach to a specific point.

You can also watch the trade history by clicking on the bottom options hsown on the left corner.

Question no 4 :How to place Buy and Sell orders in Stop-limit trade and OCO ,? explain through screenshots with verified exchange account. you can use any verified exchange account.(Answer must be written in own words)

The stop limit order is placed when you want to safe yourself from loss. It combine the stop loss and limit order and help to minimize the loss ratio. We need to set the stop price and limit price while placing the Stop limit order.

Limit Price: The lower bound of the price which you have set as target.
Stop Price: When reach to your set price

How to place stop - limit orders.

Login to binance account

Click on Wallet button

Choose Fiat and Spot

Type the coin. I again select steem. Select Steem/BTC

Select stop limit

Enter the Stop limit price

Enter the limit order

Enter the amount for which you want to place the buy order

Click on sell

Set the stop price and limit price in the buy section. Our order will be performed at the limit order when the price of pair touch the stop price. At that time, it turn into limit order

Sell stop - limit order.

Login to your binance account

Click on wallet button fro manu bar

Click on th Fiat and Spot option

Tyep coin you want

I again select steem. Select the pair of your own choice

select the Stop limit option

Select Stop limit. Enter stop limit

Enter limit order

Enter the amount and then Click on sell

Set the stop price and limit price in the buy section. Our order will be performed at the limit order when the price of pair touch the stop price. At that time, it turn into limit order

OCO buy order

Login to your binance account

Click on wallet button fro manu bar

Click on th Fiat and Spot option

Tyep coin you want. I choose for suppose STEEM

Select the pair of your own choice

Click on the Stop limit. Click on OCO option

Suppose that we see the the price of steem goes down in market. We buy the Steem a close point to the Support postion. Suppose that while placing the sell order, we enter the stop limit as 2 ans limit order as 1.70 because we never know when the support level is finish or not.

But here we perform another step too. We enetr the "Price". Suppose we set the price as 3. Soif our prediction goes true, we will have profit but in reverse case, the stop limit will be there to execute and safe us from loss.

OCO sell order


Login to your binance account

Click on wallet button fro manu bar

Click on th Fiat and Spot option

Tyep coin you want . Suppose i select steem

Select the pair of your own choice

Slick on the Stop limit and Click on OCO option

Set the stop price, limit order and price

Suppose that there is the uptrend in market. But i will obviously will turn into downtrend too. We have set the limit order price and stop price more than the resistance price. If the price of coin is 1.95 and we buy it at stop price. We will have the profit out of it for 2$.

Ifthe price of the pair rise up to my stop price, my order will be executed then.

Question no 5 :How order book help in trading to gain profit and protect from loss?share technical view point, that help to explore the answer (answer should be written in own words that show your experience and understanding)

The order book help the traders in many ways.

If you have a Bitcoin. You see that the market price of this coin is rising and there is market uptrend there. You want to sell this coin. You can easily do this by placing a buy order on the crypto order book. The coin will be sell at the current market price and you will get good profit.

In other case if there is market downtrend and the price of BTC is falling fastly and you want to buy the coin at that low price. You can buy this easily by placing the buy order on order book. You will get the coin at that low market price. The order book help us to identify the resistamce/support level. If you see that the investors are invested highly, it mean that the price of that coin is going up and market will be uptrend. Support level will not break. But if you see that the investors are withdrawing their investment, the price will be starting low. The market will be downtrend. So in this way, we can analyze whether the market will be uptrend or downtrend in future.

The order book show us the market price of coin with its volume, limit order, stop order, capitalization, etc. The market change according to the volume. These things help us to find out the market trend. The buy and sell position on order book shows you the direction of market. The market is rising if the buy volume is high. The market is going to downtrend if the sell volume is high. The OCO help the trader to save from any big loss. Mean if the price of coin is rising according to your prediction then you will get the good reward for your investment. If the price start falling then you will get your invested money back with a tiny loss. But OCO always protect you from any big lose

The limit Order is a feature in order book which can be return into a good profit. Mean if you buy a coin in 10k and want to sell it in 12k, you just place the limit order to sell that coin in order book. Just wait till the price goes up to 12k and then you can earn profit of 2k by selling that coin.

So it always help us to save from any lose, to determine the market trend and to make profit.

Conclusion

In this week, i have learnt alot about the Order book. This lecture teach us that the order book can be useful for determining the market trend. The order book help us how to protect ourself from lose and how to make profit from our investment.

The profit can be earn by using limit order and the losses can be minimizing by using stop limit. If your predictions come true, you will get good profit by using the OCO feature of order book. If your predictions goes wrong, you will be safe from lose because of stop order.

THANKS