What you’ll learn?
- Learn about price formation
- Understand the role of exchanges
- What price information an exchange provides
- Interpreting order books & depth charts
In the first article of this series on how to trade cryptocurrency we distinguished between thinking about risk and opportunity – in terms of short term price volatility and long term asset performance.
In general, focus on the long term is considered Investing, while executing strategies over a short time frame is what we mean by Trading.
Trading requires a specific type of analysis because the focus is solely on short term price volatility, which is driven by different factors to those that play out over months and years.
This is known as Technical Analysis, and in order to understand it you have to start with the very basics, such as what price is, and where it comes from.
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