RELEVANT ANALYSIS TO CONSIDER BEFORE TRADING DIGITAL CURRENCY

Hello to everyone in this wonderful community today and in this great community and on this great platform at large. I greet you all in good spirit and I want to believe that we all are doing just great today and if so we give God the praise for the sustenance of life and good health.

I welcome you all to yet another beautiful day and I hope we all are had a great weekend and fun with family, friends as well as loved ones.

Today I am here to discuss an important topic with you all regarding the digital currency trading. I have had so much experience both personal and from others about the digital trading especially when analysing the digital market before executing a trade entry.

There are mistakes which most traders make especially newbies when making a fundamental analysis and in regards to that I am here to give us some tips when making a technical analysis before moving further to execute a trade. So today I have titled my discussion RELEVANT ANALYSIS TO CONSIDER BEFORE TRADING DIGITAL CURRENCY.

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This discussion will be broken down to various segments in other to understand it more clearly so I will be taking a few days to explain the strategies to consider before executing a trade in the market. The sub topic for today is considered as The market structure.

We will be starting with the market structure as though it is part of those strategies we are expected to consider before executing a trade in the cryptocurrency market.

In respect to that I urge us all to stay put and take a chill pill, relax as I begin the discussion for today and I wish you a happy reading!!

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The cryptocurrency market trading is quite different and complex especially when making Futures trade. It is one that is easily to understand the market movement as we get to see different activities and manipulation by strong hands in the cryptocurrency market but there are ways by which one has to consider before executing a trade in the cryptocurrency market in other to minimize losses. Some of these ways are briefly discussed below.

CONSIDER THE MARKET STRUCTURE

The market structure comprises all the activities that is carried out in the market and it includes the supply and demand order book, the individual such as the buyers and sellers that are present in the market and also the relationship between the participants and their actions in the market.

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For more emphasis I will be explaining them one after another in other for us to understand the key features of the market structure and their relationship.

ORDER BOOK

This forms the market liquidity regarding asset. The order book shows the activities regarding order that are placed on various assets such as the supply and demand of a particular asset. It is also concern with the depicting of the price and number of asset in which a trader has decided to purchase in the market.

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With the order book, we get to see the quantity and price range a trader or an investor is willing to either purchase or sell out in the market and this activities forms the solid ground for the liquidity of the said asset the trader is purchasing or letting off.

The activities helps to generate more liquidity for the asset and mind you, all digital asset in the trading market has their respective order book and as traders make trade transactions the order book shows all the activities in the market as well as the price range of the asset during the time of execution.

The other book has two color and these are the green and the red color. The green color signifies the Demand activities while the red color signifies the Supply activities. It also shows us the price range and the number of traders and investors who executed the trade at a given point in time and at the same price range.

The more the trade volume regarding the activities of traders in the market either buying or selling the said asset, the higher the liquidity regarding the asset. As such there has to be a balancing in the supply and demand zone if we want to see a more stable price in the said asset. The green and red color sides also represent the buy-side liquidity and the sell-side liquidity.

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CONCLUSION

The order book gives a general overview of the market and as such as a good trader it is expedient that you look closely at the market to see the current price and the rate of traders activities in the market. You have to compare the activities of those selling off the assets to those purchasing the asset and also look closely at the current price and the previous price.

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If you notice that the price is increasing and the number of buyers is greater than that of the sellers then it could be a buy entry trade plus this can be seen on the order book.

Thank you all for having me today. We will have to continue when next I am here but for now this is where I will be dropping the pen for today. Have a great day ahead!