Steemit Crypto Academy Season 2 Week 4 Homework Task for @stream4u

in SteemitCryptoAcademy3 years ago

Blue PMI Chart Poster.jpg

I'm glad to have another opportunity to join this week's Crypto Academy lessons. The last lesson by professor @stream4u was about "Price Forcasting" of which I learned how to predict the price of an asset in the near or far future. This week, the professor discussed Margin Trading and Leveraged Tokens Trading. I'll proceed to answer the given questions.


(1)What Is Crypto Margin Trading?

Margin Trading is the method of trading that involves obtaining funds from a third party ( i.e an Exchange) in order to leverage your position on the market. The funds obtained are as double (×2), triple(×3), even up to ×100 of the capital committed.

The funds operate the same way loans do in the physical world. It boosts your overall capital and would be paid back plus interest after the entire trade process. Margin Trading increases the overall capital. This means that profit is maximized. In the case of a bad trading day, it also means that the loss incurred would be devastating.


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(2)How To Plan For Trading In Crypto Margin Trading.

  • Set up a plan: It is ill-advised to jump into margin trading without setting goals and a laid down rule you should follow to achieve the goals.

  • Don't let greed and fear to control your decisions. You may be looking at the possible gain you'd make from margin trading forgetting that if all doesn't go well, the loss would be devastating.

  • It is better to start out with a fraction of your capital. If your initial capital is $10,000, using the whole value is an unwise decision. You can start out with $2,000 or even as little as $500. The accumulated profit would be worthwhile and in the case of any loss, it would be minimal.

  • Study the market and analyse before jumping into margin trading. Although you may be lucky, jumping in blindly is a bad idea because market volatility could take you unawares.

  • Know when to make an entry and when to exit. It's either you trade smartly or don't trade at all.


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(3)Crypto Exchanges Name That Provide Margin Trading Service and What Margin They Provide?

ExchangeMargin Offered
Binance1X- 25X
Bybit50X - 100X
Poloniex2.5X - 5X
BITMEX100X
Kraken5X


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(4)What Is Leveraged Tokens Trading?

Leveraged Tokens Trading is the use of leverage tokens to gain an advantage point in the crypto market.

A leverage token is a tradable asset in a given exchange that gives an advantage in the market of a particular coin depending on the direction of the price movement.

For example, Binance offers Binance Leveraged Tokens (BLVTs). Examples of this are the BTCUP and BTCDOWN


Below is the chart for BTC/USDT pair:

Snapchat-380220136.jpg


Below is the chart for BTCUP/USDT:

Snapchat-1731078620.jpg


Below is the chart for BTCDOWN/USDT

Snapchat-1217254613.jpg


From the illustrations above, you would notice that the charts for BTC/USDT is the same as that of BTCUP/USDT. But take a look at BTCDOWN/USD. It is the exact opposite of the other two charts.

BTCUP and BTCDOWN are both leveraged tokens. BTCDOWN offers a leveraged position in the market when the price of Bitcoin is falling. BTCUP offers a leveraged position if the market is bullish.


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(5)How To Plan For Trading In Leveraged Tokens?

  • Proper analysis should be done when trading leveraged tokens. Leveraged tokens should only be bought after the charts have been thoroughly studied.

  • Stick to your planned strategies. Don't let greed make you run at a loss

  • Make an entry and exit when necessary. Don't hold on to these tokens because they're only for leveraged positions and don't always show the true nature of the market. Just like the case of the BTCDOWN in which the green candlesticks represent price going up whereas in true sense, the Bitcoin market is experiencing a dip.

  • Most importantly, newbies should not rush into leveraged token trading. You would make dreadful mistakes.


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(6)Crypto Exchanges Name That Provide Leveraged Tokens Service and What Margin They Provide In Leveraged Tokens?

ExchangeMargin Offered in Leveraged Tokens
BITMEX3X
Kucoin10X
Kraken5X
Huobit5X


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(7) Price Forecast For Crypto Assets STEEM/BTC

Snapchat-289284841_1.jpg

The STEEM/BTC chart shows that there was a support at the price of 0.00001152BTC in March and later in April. Looking at the chart, Steem is almost close to it's last resistance which was some time in April.

Snapchat-1354330765_1.jpg

By my predictions I believe that Steem wouldn't cross it's last resistance. I believe that there would be a bearish pullback from it's recent position. Although a breakout from the last resistance is possible, I feel that the price for next week would be between 0.00002395 BTC and 0.00001504 Btc

Snapchat-1436599336_1.jpg


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Conclusion

Margin Trading and Leveraged Tokens Trading is a lucrative strategy and can yield very high gains. But without a set plan you would be running into losses which would make you think that you repel money. By following a straight plan, you would smile at the end of the day.

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Hi @uchescrib

Thank you for joining The Steemit Crypto Academy Courses and participated in the Homework Task.

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Your Homework Task verification has been done by @Stream4u, hope you have enjoyed and learned something new.

Thank You.
@stream4u
Crypto Professors : Steemit Crypto Academy
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Thanks prof. I really enjoyed the lesson

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