Cryptocurrency Trading And Terminology

12 December 2020

Is blockchain popular? Does Bitcoin make you rich? Do you also want to know how digital currencies are traded? Let’s take a look at these basics and related terms first.

Basic characteristics of virtual currency trading:

  1. Trading time: 7 * 24 hours, open all year round.
  2. No daily limit: There is no daily limit for virtual currency transactions, and there is a daily limit for stocks. For example, on May 28, Bitcoin rose by more than 20% in a single day.
  3. Trading unit: The minimum can buy 0001BTC (about 0.6 yuan), there is no buying limit of at least one lot (100 shares) of stock.
  4. Trading at any time: T + 0, the stock is T + 1, that is, the stock is bought on the same day, and it can be sold on the next trading day. The virtual currency is a T + 0 transaction, which can be sold on the same day of purchase.
  5. There is no time limit for withdrawing and cashing: Withdraw cash at any time, and the liquidity is high.

 

Basic principles of virtual currency transactions:

  1. Limit Trading: Investors can set an order with a purchase price lower than the market price or a sell price higher than the market price. When the market price fluctuates to its set price, the transaction is concluded. When the set price and market price deviate greatly, it is prone to results that cannot be transacted.
  2. Market transaction: The transaction at the current market price can to a certain extent ensure that the investor’s buying and selling orders are completed in a timely manner. However, at the same time, investors cannot predict the transaction price before the market order is placed, and there is a certain degree of uncertainty. In general, the more volatile the market, the greater the risk of uncertainty in the transaction price of market transactions.
  3. The basic principle of the transaction: the principle of “price first, time first”. A higher buy price is better than a lower buy price, and a lower sell price is better than a higher sell price. When the order price is the same, the earlier order is better than the pending time. Late orders were closed.

 

Common terms used in virtual currency trading:

1. Position: refers to the proportion of the investor’s actual investment and actual investment funds.

2. Full position: All funds are used to buy virtual currency.

3. Lighten up: Sell some virtual currencies, but not all.

4. Heavy storage: Compared with virtual currency, available funds have a larger share of virtual currency.

5. Light warehouse: Compared with virtual currency, available funds account for more shares of available funds.

6. Short positions: Sell all the virtual currencies held in your hands and turn them into funds.

7. Take Profit: After obtaining a certain profit, sell your virtual currency to keep the profit.

8. Stop loss: After the loss reaches a certain level, the virtual currency held is sold to prevent the loss from further expanding.

9. Bull market: Prices continue to rise and the outlook is optimistic.

10. Bear market: Prices continue to fall and the outlook is bleak.

11. Long (long): The buyer believes that the price of the currency will rise in the future, buy the currency, and after the currency price rises, sell at a high price to make a profit.

12. Short (short): The seller believes that the price of the currency will fall in the future, and sells the currency held in his hand (or borrows it from the trading platform). After the currency price falls, he buys the profit at a low price.

13. Open a position: buy virtual currency.

14. Makeup positions: buy virtual currency in batches, for example: buy 1BTC first, then buy 1BTC.

15. Full position: Buy all the funds into the virtual currency at one time.

16. Rebound: When the price of a currency falls, the price rises and adjusts because it falls too quickly.

17. Consolidation (horizontal): The price fluctuations are small and the currency price is stable.

18. Overcast: The price of currency is slowly falling.

19. Diving (waterfall): The price of coins has fallen rapidly, with a large margin.

20. Cutting meat: After buying virtual currency, the price of the currency drops. In order to avoid the loss from expanding, the virtual currency is sold at a loss. Or if the borrowed currency is short, the price of the currency rises, and the virtual currency is bought at a loss.

21. Fasten: The currency price is expected to rise, but the currency price is expected to fall after buying; or the currency price is expected to decrease, and the currency price is expected to rise after selling.

22. Unraveling: After buying virtual currency, the currency price drops causing temporary book losses, but then the currency price rises and turns into a profit.

23. Going short: After selling the virtual currency in the bearish market, the price of the currency has risen all the way, and it has not been bought in time, so it has not made a profit.

24. Overbought: The currency price continues to rise to a certain level, the buyer’s power is basically exhausted, and the currency price is about to fall.

25. Oversold: The currency price continues to fall to a certain low point, the seller’s power is basically exhausted, and the currency price is about to rise.

26. Incentives: The currency price has been consolidating for a long time, and the possibility of decline is large. Most of the shorts have sold virtual currencies. Suddenly, the short side has pushed the currency price higher, tempting many parties to think that the currency price will rise, and they buy one after another. The result is empty. The party suppressed the price of the currency, making many parties stuck.

27. Induced shortness: After buying long virtual currency, the bulls deliberately suppressed the price of the currency, so that the shorts thought that the price of the currency would fall, throwing them out, and the result was a mistake in the long trap.