Crypto Academy / Season 3 / Week 1 - Homework Post for @lenonmc21 - TRADING

TRADING
Trading according to a lay man and general acceptability of what trading means, it can be defined or seen to be the act which involves buying and selling of goods and services amongst 2 or more persons.

Another view of what trading is, can be seen as a basic economic concept which entails buying and selling of valuables, valuables in the sense that, you exchange value for value, it could either goods or even services.

Therefore, the term crypto trading can be said to be the process which involves speculations or prediction of price fluctuation of a block chain or asset through contract of different trading account. More so it could also be seen as the process of buying and selling of an asset (blockchain) through an exchange. When buying and asset (coin) you must be signed up to an exchange that would help you get your assets saved, like Binance, Cex.io, Trust Wallet, Coin base and lots, and you will also be provided with a wallet address to enable you have access to your asset. Just like a bank account number.

Haven’t talked about trading, there are more styles and ways to which you can trade. These ways only provides you with the various investment plans on investing or starting trading in the crypto world, below are some few styles and ways to which you can trade and it is also discussed too.

1. DAY TRADING: this form of trading is been seen as it’s name implies, for instance, you trade on an asset which you aimed at either reach the profit level or loss within 24hours of margin set. We call it Day Trading because you are not holding the coin or asset for long. Also learn to always put stop loss while trading Day Trading so as to avoid massive loss.

2. SCALPING: scalping can be seen as quick profit or loss taking style, unlike Day Trading, in this format of trading action are taken immediately once there is any form or slight change either upward or downward of the chart on the coin or asset one is trading on.

3. SWING TRADING: in this form of trade, traders set a target to where a coin or asset should hit before either taken profit or stop loss. Entry in this form of trading comes as a result of findings on fluctuation of the assets.

4. INVESTING : in this format of trading activities are seen or assumed to be Holding of asset since you are only buying for future, most people make mistakes while investing and thinking they are trading, apparently they are 2 different things entirely, though this could also be similarly seen as one if the HODler sell within a short pump price and vice versa.

5. POSITION TRADING: this type of trading similarly looks like that of Swing Trading but with a little difference, here you set a position (high) for which you want the asset to reach, sometimes it takes days, weeks or even months.

FUNDAMENTAL ANALYSIS OF TRADING CRYPTO
As it implies fundamental, this is an approach used by traders or investors to operationalize on the internal value of a coin. This strategy includes knowing the intrinsically extrinsic of a coin so as to weight it’s value whether it’s an overhyped or an underestimated coin before investing or trading on the asset. This strategy might be cruel but many have been giving positive testimonies about it. There are vastly many fundamental tools used in knowing the true value of an asset so as to make conclusion if it’s advisable to invest in it or not which a few are as listed and discussed below.

1. TRANSACTION COUNT: this is a fundamental tool used by traders to determine whether to invest in a said asset or not through reading the activities of the coin through the asset network. That is, the inflow and outflow movement of the asset. Hence, this tool is too cruel to judge the value of an asset because it can be manipulated through founders or some set of individuals might just be toying with the asset so as to make it look active. A typical example is DOGE COIN Controversy.

2.ON CHAIN METRICS: this is a tool used in know the value and trend of an asset through monitoring the data (Chart) giving by the block chain. The picture below shows show exactly a typical example of what On Chain Metrics means.

3.RANSACTION VALUE: this is when there is provision to know the volume and value through knowing the amount which has been transacted on the said asset within a period of time and picture below shows exactly a simple example of this situation.

4.WHITEPAPPER: this is apparently important to read before one invest or trade on an asset because it shows description of the Asset, Aims and goals of the project and other important keys one need to know about the asset.

5.FEES PAID: we can jump into conclusion that an asset or coin is quite good to invest in or not through checking the network fee so as to determine if it is well traded and at which rate it cost to transfer assets.

TECHNICAL ANALYSIS OF TRADING
Technical analysis can be seen or described as the ability to use either the past present data of an asset to predict or determine the future of the asset in the market. For instance if the cost of GOATCOIN as been ranging upward differently since the past 3years with 5% increase which the initial value is $50 we can agree or conclude that GOATCOIN might $150 in few years, due to the fact gathered from the past and present of the value of the asset. There are also some factors to which one can use to determine the future of an asset and it’s as listed and discussed below.

1. READING CANDLE STICK CHART: this is a crucial and sensitive one where you would be forever to determine the chart, though it requires some act of professionalism and understanding, but when mostly the Green candle is always indicate that the asset is rising in value.

2.UNDERSTANDING THE TREND LINE CHART: trend lines are lines that indicate the movement of the asset either upward or downward. This also requires skills to understand before trading technically trading crypto.

3.UNDERSTANDING THE MARKET CAP: this is also crucial and important for which you can technically read if an asset has significance in the market through there liquidity and volume at which has been traded on the said asset. You can always do this buy using the www.coinmarketcap.com, the picture below shows a typical example

LIST OF SOME CRYPTO EXCHANGE WITH HIGHEST TRADING VOLUME.

1. HUOBI GLOBAL is one with over $11billions trading volume in the last 24hours and has virtually over 331assets traded on it. URL is HUOBI.COM and it accepts Fiat’s such as ALL, AUD,BRL.

2.KRAKEN: lastly this this happen to be the 4th on the list (source: coin market cap) with over $1billion trading volume in the last 24hours with over 60assets and accepts Fiat such as USB, EUR, and GBP.

3.Coinbase Exchange is another, though ranked 3rd on the list with over $2billion what of traded asset volume traded on it in the last 24hours and it also has over 74 assets been traded on it and it accepts Fiat’s such as USB, EUR, GBP. URL is https://pro.coinbase.com/

HOW TO BUY ASSET /COIN FROM COINBASE

In using a web browser,
• Sign in to Coinbase.
• Select Buy / Sell on the upper right-hand side. Make sure you’ve sign up already otherwise that might not prompt

• Click the Buy field to select the asset you'd like to purchase. Note make sure you are using a card which details used to sign up on the site is appropriately used

• Enter the amount you'd like to buy denominated in crypto or your local currency.

• Select your payment method.

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• Click Preview Buy to confirm your purchase (you can always click the back arrow to make a change).

• If the details are correct, click Buy to complete your purchase.
Image source:
If you’d like to make this a recurring purchase, click One time purchase and select how often you’d like the purchase to repeat.

Reference:

CONCLUSION
This article is not limited to more research base. Furthermore, taking crypto is a life changing phenomenon but also have its own flaws so the ability to know how to trade is very crucial and important, therefore you need to understand when to go in and when to pull.