What is the best way to make a trade?

• The most basic trade execution choices

• Terming used in trading execution

• Optional inputs for making a trade

• What is the best way to mix trade and strategy？

• What is the best way to close a trade？

You might think that understanding how to implement a cryptocurrency trade would be one of the first topics covered in WikiBit on bitcoin trading. It isn't the case.

We focused on first learning what trading is, the concept of risk, and what changes cost, as well as the most popular ways to trading decisions.

This post believes you've given those topics enough thought and are ready to put your money where your mouth is.

We'll use Binance and Coinbase as examples to make things as plain as possible, though other exchanges are available. We don't have much in common with either of them.

Coinbase is ideal for newcomers because it streamlines the procedure, but ease of usage should not be the only factor to consider.

A commission and fees are charged when you make a trade, and they vary based on the exchange. These fees are relatively high (and difficult to understand) at Coinbase, but considerably lower at Binance, where the interface contains more scary trading choices that presume a certain level of knowledge.

To learn more about the numerous variables, read our article on selecting an exchange. We'll use examples from both for the purposes of this essay, depending on the situation.

We also assume you've already set up and funded your account; if you'd want a walkthrough of those steps, check out this page.

Spot Trading

Exchanges present a variety of complex ways to trade that will be discussed in future articles, but they are inappropriate for anyone just getting started and will definitely cause confusion. So we'll just concentrate on the most basic trading option: spot trading.

Spot Trading and Spot Exchanges allow for real-time trading. You simply accept the Market's available price at a certain exchange at a specific time. A Market Order is used to do this.

Market Orders lack precision, which is why they are most suited to the least time-sensitive ways to trading, such as Cost Averaging and Hodling, which are also suitable for novices.

Market Order on Coinbase

Coinbase streamlines the process of placing a Market Order to the point where you don't have any other options. You have a Buy button that gets you to a window where you can place a Market Order - albeit this isn't how Coinbase describes the process because it removes all trading language to make things easier.

You can also make the trade regular - weekly or monthly - which is great for Cost Averaging (as previously described) and demonstrates the type of user Coinbase is aimed at.

There is no interface for trading. Coinbase trades are conducted through Coinbase Pro, which is designed for professional traders, as the name implies.

In essence, Coinbase is an entry-level exchange where beginners may acquire cryptocurrency with minimal effort, with Coinbase Pro, a platform for professional crypto traders, powering it behind the scenes.

You have access to the Pro platform when you open a Coinbase account, but you should only use it once you've mastered the trading procedure.

As previously said, Coinbase is simplifying the trading process, which is beneficial to newcomers, but at the expense of sophistication and high fees.

Before you commit to a deal, you will see a confirmation of Price, and you can also view the information retroactively through your account to generate a trading P&L. (Profit & Loss Report).

Binance offers a comparable, no-fuss solution called Convert. This relates to both changing your Fiat into Crypto, which is what we're attempting here, and converting one Crypto to another, which is a step forward.

Once you've logged into your Binance account, go to the main menu and select Trade. You'll see Convert, which is accurately described as the simplest trading option.

At Binance, the Convert interface looks like this. Remember, this is a Market Order that has been simplified.

Returning to a Traditional Trading Interface

Classic Trading is the next choice down on the Binance Trading menu, as you can see. This provides a more traditional trading interface as well as a larger selection of Spot options, as well as new Market Orders kinds that we'll go through in the walk-through.

When you switch to the Classic Trading menu, the interface becomes significantly busier, with a lot more information to take in.

Step 1: Select the Traditional Trading Interface.

Select “Classic” from the “Trade” drop-down menu. It will display the screen below. It's easy to see the difference between this screen and the Convert Interface (or Coinbase Buying procedure).

Because the Classic interface believes you want to be significantly more proactive in the Trading process, there is a lot more information to grasp. When we discussed exchanges and price discovery previously in this part, we mentioned several of these elements, the most essential of which is the Order Book.

An order book is a place where buyers and sellers can browse the cryptocurrency's available offers. These order books are continuously updated 24 hours a day. An order book for the BTC/USD trading pair is an example. The screen below displays the current market offers for buying and selling BTC in exchange for EUR.

An order book for EUR/BTC pairs is shown in the image above.

Orders with a green color code are purchase ones, whereas orders with a red color code are sell orders. This picture is necessary to determine the level of interest from both sellers and buyers at various price points. Traders can utilize this information to determine probable resistance or support levels.

Step 2: Decide on a trading pair.

The list of Trading Pairs can be found on the right side of the page. Binance categorizes the pairs of assets you can trade by the trading base: we've defined what Trading Pairs are elsewhere.

· Binance's native currency is the BNB.

· BTC - Bitcoin

· Alternatives - The Most Popular Alternative Coins

· FIAT - Fiat money, such as the Euro.

Because this is your first trade, you'll want to start with FIAT and select the appropriate currency.

You should pick the EUR/BTC Trading Pair if you've made a Euro deposit and want to buy Bitcoin here.

Step 3: Choose the type of trade you'd like to make.

After you've decided on your Trading Pair, you'll need to decide on the type of deal you want to make. At this time, you can see how Coinbase's simple Market order option and Binance's Convert trading option have been expanded to include two more alternatives.

• Market Order: As previously stated, this feature allows users to trade cryptocurrencies at their current market rate. Because this order is filled instantly, you will not be able to cancel it.

• Limit Order: It allows you to choose the lowest price for which you want to sell coins and the highest price for which you're ready to pay for them. After that, you'd have to wait for a buyer or seller to accept your offer. If you plan to HODL, place a limit order at a price higher than the current market price to profit if the price rises.

• Stop-Limit Order: This type of order allows you to sell or purchase a coin at a defined price. Set a limit price below the current price as the first objective if you're trading for the short term. To limit risk, you can also place a stop order above the current price.

Step 4: Enter the Amount You Wish to Purchase

Because we're working with a Market Order, all you have to do is enter the quantity of BTC you wish to buy in Euros. As you can see, we're purchasing €20 worth of BTC. You can also use the slider to select 25 percent, 50 percent, 75 percent, or 100 percent of your available amount to purchase with.

Placing a Stop-Loss Order

We'll place a Limit Order now that we've looked at Market Orders. Rather than merely completing a deal at the current market price, we now provide a price and an amount as our entry point.

An entry point, as mentioned in our article on Trading Strategy, is an important part of any trading strategy that begins to take you away from DCA/Hodling and toward active trading.

You can place a EUR/BTC limit order at a desired price and then wait for the market to reach it. Your EUR/BTC order will be executed at the given price if the preferred price is attained.

This is how it should look:

Step 1: Enter your starting price.

This is the price at which your order will be fulfilled if it is met. The buy would be triggered at an entry price of €45,000 in this case.

Step 2: Enter the amount you'd want to spend.

If the Entry Price is met and there are enough sellers, this is the amount you'll buy.

You would be purchasing €20 in this case, or 0.000444 BTC.

Step 3: Before placing a limit order, double-check it.

Before submitting the trade, double-check the Entry Price and Amount you specified. Mistakes can cost a lot of money.

Place the Limit Order in Step 4

To make a Limit Order, click the 'Buy' button. The order should then be checked under the “Spot Order” tab on the Binance interface's right side. All of your trade history is displayed on the screen below.

Bringing The Deal To A Close

you must close it. This is essentially the opposite of buying.

You simply sell at the current Spot price on Coinbase or Binance.

You can either sell some or all of the BTC you bought. You'll receive confirmation, and your Fiat balance will update, allowing you to withdraw funds using your preferred payment method.

It's important to note that you can't usually withdraw money back to a card.

If you're using the Classic Trading View, all you have to do is issue a Market Order Sell instead of a Buy, noting the amount you wish to sell. This will execute at the best available price, resulting in an update to your Fiat balance, which can then be withdrawn to any of your available payment methods.

Changing BTC to a Different Cryptocurrency

At this point, you've learned how to use a Market Order to buy Bitcoin with FIAT on Coinbase and Binance.

You've also looked at Binance's Classic Trading Interface, which adds extra trading choices including Limit Orders and the selling procedure.

You can utilize the “Convert” to exchange a pair of Bitcoin and an Alt Coin now that you have Bitcoin. Coinbase also has a Convert option that works in the same way that Binance's, albeit Binance has a far larger variety of BTC trading pairings. The “Convert” option is available on Binance under the “Trade” page.

You can enter the amount of BTC you want to convert to ETH (Ethereum) or one of the other available coins. You can preview the conversion once you've input the amount to see how much BNB you'll get after the conversion.

Beyond the Spot Market

This guide's goal is to arm you with enough knowledge to make your first bitcoin deal. Because there are so many trading alternatives, it's purposefully simple. As previously stated, Spot Trading refers to the price at the time of purchase. The term “derivatives” refers to a different aspect of trade.

Derivatives allow you to trade on a derivative market for a cryptocurrency's future price under certain criteria. Futures, for example, are a sort of derivative that focuses on the price movement of a specific future. You don't buy the underlying asset; instead, you engage into a contract detailing the terms of the trade, such as whether you believe the price will rise or fall, and a concept known as leverage, which will be discussed in the following article.