STEEMIT CRYPTO ACADEMY WEEK 12 - HOMEWORK POST FOR PROFESSOR @stream4u.

Hello Everyone,

i have gone through the lecture and i will work on my project to the best of my capability. Thank you @stream4u for this wonderful lecture.

let’s get started...

Question 1.

Crypto Margin Trading is a form of trade that allows users to borrow capital from other traders or an exchange to be able to trade with more capital than they have.

Most crypto exchange provides 3x, 5x, or even 100x margin depending on the exchange. This means when an individual has 20$ as initial capital and chooses 3x margin it means you are going to trade on a coin with $60. Profit or loss will now depend your $60 not your initial $20.

It is important to know that, as you can make profit of 3x, 4x or even 100x it also works the same on the other side of the coin. That is, if the market is not in your favor you can equally loose money from the same margin.

For example when i have initial capital of $1000 and i want to trade with $5000 worth of Bitcoin, i will need a 5x margin trade. After a successful trade and i am able to make some profit i will have to pay back the borrowed $8000 and additional interest. This type of trade is not suitable for beginners, it needs a lot of experience like when to jump in and when to jump out. Any small mistake can lead you to loose your money and also puts you in dept.

Question 2.

• You shouldnt use all your capital into margin trading. It is advised to use money that you do not need anytime sooner and also use money you can afford to loose. Margin trading involves high amount of risk so its better to be more careful with the amount of money we invest in. The market may not go our way.

• As i said earlier, every exchange has their leverage options and limit(2x,5x,10x,50x,etc). Before you begin to trade you need to choose the type of exchange you want to use not only for the leverage options but also the fees. Choose exchange which fees favors you also.

• You will need to decide on which crypto currency to which you will invest in. This is an important in crpto margin trading. Token should be selected base on a critical analysis of chart of the coin, trend, and volatility of the price, that is to say make tecknical, fundamental and sentimental analysis of the market, So basically you need to make price forecasting of the coin your priority.

• We need to also decide how long to hold positions either long or short. This will depend on the previous price forecast you have done about the coin. It is advised to hold long if the price is seen to go high and hold short if the price is seen to go low.

• To avoid indecision, you should set target and hold to it. This will help you to have a clear path on what you want to achieve and also to avoid making wrong decisions.

Question 3.

There are alot of exchange that offers margin trading service. few i will metion below.

NAME	MARGIN
Poloniex	2.5x
Huobi	3x
Bianance	5x
Kraken	50x
prime XBT	100x
BitMEX	200x
BEX500	200x

Question 4.

Leverage trading is the ability to increase one trading position by borrowing funds from an exchange. This type of trade do not demand only the use of your funds but can be increased by using the borrowed asset given by the exchange. The trader studies the market trends and buys a leverage token with the aim to sell for profit.

Leverage trading highly depend on how strong you make your price forecasting. Price forecasting helps you to predict the price of an asset. If the market goes in favor of your prediction you make profit and if it goes the other way you make loss. This is the reason you need to make your price forecasting right.

Leverage trading is in two form either in bullish(rise) or bearish(fall). Example If a trader decide to invest in BTC and it goes up the BTCBULL will go up and also BTCBEARISH will go down. BTCBULL goes up because it is in favor of the market and BTCBEARISH goes down because it is not in favor of the market.

Question 5.

• Invest with money you can afford to loose. Even with a proper price forecasting there is still a chance of not getting it right and loosing money. To be on a safe side avoid using money you will need sooner.

• For a beginner you should invest with little money to gain experience at the same time avoid loosing huge money. If we are new to trading we tend to make mistakes which is normal. So to be on a safest side use small amount of money.

• Make a critical price forecasting into the market. This will guide you to make right decisions to avoid money loss.

• Before you get into a trade, you should set target for yourself and abide by it. This is to avoid making wrong decisions during trade. Its important to know you entry and exit point.

Question 6.

NAME	LEVERAGE
Huobi	3x
Poloniex	5x
Kraken	5x
KuCoin	10x
BitMex	100x

Question 7.

Doge coin in recent weeks has been on the rise in it price. Just a day ago it has it risen to $0.67. This is the highest the coin has ever reached. With the use of sentimental analysis, doge coin has been one which is being talked about. People has been investing into it due to it popularity and its high rise level.

Looking into the chart, it has risen to its highest perk, and they is high possibility of it going back down because at this stage traders will make enough profit to exit the market. Market tend to go down when people exit the market.

We can see it was able to break through the resistance, turning to support. Which further increases to a higher point. In a week the price will fall back to the resistance due to traders exiting the market because they have made some profit. It will maintain its price for awhile and rise again when traders invest again to take advantage of its fall.

CONCLUSION
To involve in any kind of trade be clear what your path is. If you are a beginner you should seek for clearing from an experience expert to lecture you. In trading you can loose money in a blink of an eye that’s why it’s soo important to make right decisions during trade.