Cryptocurrency Trading Related Terms
Before you start trading cryptocurrencies you should understand the basic terminology used. This article focuses on a few commonly used terms when trading cryptocurrencies.
1) Exchange: The exchange is a mediator between buyers and sellers. It is a place where you can buy and sell various cryptocurrencies.
2) Fiat currencies: The traditional currencies that are approved and issued by the countries government is called as the fiat currency of the country. The most common example of fiat currency is the US dollar.
3) Whale: Like used generally, Whale is someone who owns a huge amount of cryptocurrencies.
4) Limit Order: When a trader wants to buy or sell a cryptocurrency he places a limit order. Once the cryptocurrency price meets a certain amount the limit order is accepted. The traders use the limit orders to buy and sell in the marketplace.
5) Buy wall and Sell wall: It is a graphical illustration that shows the traders current buy and sells points.
6) Market Order: A normal sale or purchase that takes place on the exchange at the current price is called as a market order. Usually, we buy the cheapest option on the order book and sell at the higher prices.
7) Margin Trading: A risky way of trade using your margin amount. Every experienced trader also finds this way of trading risky. If you want to know about the trading refer this review to read more about QProfit System.
8) Going long: It is a margin trade that gives profit with the price increase.
9) Going short: it is a margin trade that gives profit with the price decrease.
10) Bullish: Expecting an increase in prices.
11) Bearish: Expecting a decrease in prices.
12) Altcoins: Any cryptocurrency other than Bitcoin is known as Altcoins. Usually Ethereum
13) Tokens: They are also currencies that are built on top of the blockchain. They are mostly used as transaction fees on platforms like the Ethereum network. A few examples of the token are:
- ICN – Iconomi
- REP – Augur
- GNT – Golem
- BAT – Basic Attention Token
14) Shilling/pumping: Marketing another cryptocurrency.
15) Stable coin: A cryptocurrency that shows very low volatility and can be used to trade against the entire market.
16) Arbitrage: Difference in the price of the same financial asset on two different exchanges. Similar to comparing the price of ETH on US exchange against the Korean exchange.
17) FOMO: Its full form is Fear of Missing Out. Every trader often faces this where he is afraid of not entering the market at the right time the market shows a rapid gain.