Hello All | As-Salaam-mu-Alaikum

Introduction

This lecture is a very important one to every crypto student, especially to a crypto trader who is still lingering on how to trade.
Respected professor @yousafharoonkhan has taught so well, as I have now understood what "Exchange Order Book" is all about.

Exchange Order Book: In respect to cryptocurrencies, this is a record tool where bids and orders (buys and sells) are listed and arranged in a written form.

Let me proceed to my homework task for this week__

Question 1

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)

Answer

Order book as I have come to know, Is a book that provides the opportunity for a trader to buy and sell assets of his/her choices in the cryptocurrencies market. In other words, Order book is the list of Placed or Open orders available for sale or buy, and it's usually in crypto pairs.

This order book as it is important, can help a trader have a live-view of the market manipulations, revealing the fluctuations in the pair of coins, and most especially a view of the resistance zones.

How crypto order book differs from our local market, with examples includes:
As I have been made to understand, Order book in the local market simply means the physical recording of what we face on a daily basis when we go to our local markets to buy goods that has no stable or particular price.

• In local market order book, when we select the asset or goods we want, after agreeing on a fixed or particular amount, we would usually make payment using our local Currencies. In other words I won't go to the market to buy a particular food stuff using another type of food stuff.
  For example: I walk to a local market to buy food stuffs (fish🐟 and oil), after settling on a particular price, I would make payment to the seller using Naira notes because am in Nigeria.
  WHILE
  Crypto order book which I preferably call exchange order book is the list of Placed or Open orders available for sale or buy, and it's usually in crypto pairs.
• In exchange order market, when we select the asset or coin we would love to acquire, we make payment using another coin or better still we exchange the coin we have with the coin we wish to have.
  For example: I log in to a crypto wallet that usually supports exchange or peer to peer trading, And am having some steem coins, but what I really want now is Bitcoin, what I just need to do is to place an order for Steem/BTC pairs, which means giving out my steems to get bitcoins.
  

Question 2

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

Answer

I will be showing you how to find order book using the Binance exchange wallet. Steps to follow includes:

• Login to your verified Binance exchange wallet

• Locate the Market of your wallet, under "Spot" where you would see some already existing pairs, their prices, market cap, 24hrs changes etc.
  

• As you can see on the screenshot below, some pairs have been added as favorite for easy access. Nevertheless, if you want a particular pair all you need to do is to click on the "Search Pair coin" encryption.
  

• For the sake of this lecture, I will be exchanging my Bitcoin with the Doge coin (DOGE/BTC), so I will proceed to order which is either buy or sell depending on what I want.
  

• As you can see in the screenshot below, the order book consist of orders in Green and Red colors. 'Bid' and it represents the book order for buy. While the orders in Red color are regarded as 'Ask' and it represents the book order for sell.
  
  

During the course of my homework task, I got to see some terms which I would explain now. There includes:

• Pairs: Pairs when it comes to cryptocurrencies refers to the exchange of one cryptocurrency to another cryptocurrency. If for example you have 1 Bitcoin and you later feel you want to sell it and buy Dogecoins, all you need to do is to introduce or bring in pairing to the situation and you would discover that your 1 Bitcoin has been changed to multiple Dogecoins.
  

• Support and Resistance:
  We all know how unpredictable cryptocurrencies could be, but this support and resistance could guide a trader, because they are both all about how high or low a crypto can go or had gone. Support in particular refers to the lowest limit or level a particular cryptocurrency has been sold. While Resistance can be referred to as the highest limit or level a particular cryptocurrency has gone.
  

• Limit Order: This is a way of putting boundaries on how high or low you would want to sell your crypto. The aim of limiting an order is to reach a particular or targeted price, it might take some time after which your trade will automatically be made.
  

• Market order: This is where you place an order according to the current price the asset without any form of delay or boundaries. But in most cases that might not be your targeted price thereby reducing your chances of making good gains. I will advice you go for the limit order especially when you have the time to wait.
  

Question 3

Explain the important features 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)

Answer

Ok let me start by showing you screenshots of my verified exchange account (Binance) below:

Explain the important features of order book with the help of screenshots
There are so many important features of order book and I will explain some few of them below with screenshots.

• Buy and Sell: As we all know these are the most important features in the order book because they are the major and usually the final instructions taken in order book. The green color is the order book for buy while the red color is the order book for sell.
  

• Alert: There's an alert Bell in the bottom left corner of the order book, this is equally an important feature in the order book, which will alert or inform you depending on the instruction you tell it. It could inform you about price rise and fall, 24hrs changes etc.

• Currency: We all have our different local Currencies, and another important feature of the order book is that it supports our local Currencies, whereby making it easy for us to make any transaction with the currency we are familiar with.

• Markets Comparer: This is a very important feature in the order book which will help you see the market value of other pairs of a particular coin. It will help you determine the best pair to go into with a particular coin so as to make profit.

Question 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)

Answer

Stop Limit trade is a way of setting your order to reach a certain amount or price before it enters the order book. The limit oder is usually higher than a stop Limit.

Follow this steps to place Buy and Sell orders in Stop-limit trade;

• Locate the Market of your wallet, under "Spot" where you would see some already existing pairs
• choose the coin you want to pair
• click on buy or sell depending on what you want
• On the drop down menu click on 'Stop Limit' and insert your details

• After which you would proceed by confirming details.

OCO Is also known as one-cancels-the-other (OCO), this is simply the combination of two orders, and any order that is first fulfilled will automatically cancel the other.

An One-Cancels-the-Other (OCO) order combines two market orders, where if one is fully or partially fulfilled, the other is canceled.

Follow this steps to place Buy and Sell orders in COC trade;

• Locate the Market of your wallet, under "Spot" where you would see some already existing pairs
• choose the coin you want to pair
• click on buy or sell depending on what you want
• On the drop down menu click on 'COC' and insert your details
  
• After which you would proceed by confirming details.
  

Question 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)

Answer

There is no doubt that the order book is really an amazing tool that help prevent traders from loss, because it shows you the updated price every now and then, whereby making the trader know the best time and pair to trade.
It is really all about preventing loss because it can give you an alert when the price you are targeting eventually reach. And most especially, even when you are not with your device at that point when your target is reached, your placed order will automatically be traded.

Conclusion

Wow what an Educative lecture, so far I have learnt so much respected professor.
The exchange order book is really a useful tool that has helped so many traders to take wise and profitable decisions in the crypto market.

All pictures are personal screenshots on my Binance wallet otherwise designed on Canva

Special thanks:
@yousafharoonkhan

Thank you all.