Effective Trading Positions In Crypto Trading| Short And Long Positions

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Good day my fellow crypto guru,

I believe you are all doing well today and you are all being as active as ever in the community.

Today is a new day and we shall be learning something new about the cryptospace and guess what, we shall be learning about long and short positions in future trading.

Before then, we ought to understand what futures trading is, please join me in this adventure

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WHAT IS FUTURES TRADING

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Futures trading can be explained to be a Financial activity whereby traders sell or buy a financial asset and a specific price and date in the future.

These assets may be stocks, commodities etc

Futures trading plays a big role in the financial market and it permits investors to gain exposure to the various asset, manage risk, and make profits from price flunctuation without necessarily owning the asset being traded.

In futures trading, there are two trading techniques/position and they are the long/buy position and the short/sell position.

Continue this journey with me as we examine these positions.

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LONG POSITION

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A long position in futures trading can be explained to be a trading position whereby a trader buys a commodity with the expectation that the price of the goods will experience an increment.

By taking a buy position, a trader tends to make profit from the price increment that is expected to come.

Then if the price of the commodity rises above the take profit point, the trader can then decide to sell off the commodity.

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SHORT POSITION

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A short position in futures trading refers to the act of selling a commodity with the hope that it's price will decrease with time.

Short position is often done during the bearish move, when the market is making lower lows and lower highs.

If a trader enters a short position and the market made higher highs and lows, the trader will be in a loss.

However, if the market moves in his direction, he will be making some profits.

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CONCLUSION

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It is good that we always remember that profits can be made from the short and long positions in crypto trading.

A trader needs to be very careful when entering this positions, short positions should be done in a bearish move while long Position should be done in a bullish move.