Spot trading means buying or selling crypto at the current market price with immediate ownership. For example, buying Bitcoin on an exchange and holding it in the account is a spot trade.
Market Order vs Limit Order
A market order executes immediately at the best available price. A limit order lets traders set their preferred price and executes only when the market reaches that level.
Long and Short
Going long means expecting a crypto’s price to rise. Going short means expecting it to fall. These terms are especially common in futures and leveraged trading.
Leverage and Margin
Leverage lets traders control a larger position with a smaller amount of their own money. Margin acts as the collateral. Higher leverage can increase gains but also magnifies losses.
Liquidation
Liquidation happens when a leveraged position loses too much and the exchange closes it automatically. A sharp price move against a trader can wipe out the margin used for the position.
Volatility and Liquidity
Volatility measures how sharply a crypto’s price moves. Liquidity shows how easily it can be bought or sold without significantly moving its price. Both can affect trading risk.
Stop-Loss and Take-Profit
A stop-loss automatically closes a trade at a chosen loss level. A take-profit closes it after reaching a target gain. Both help traders manage positions without constantly watching prices.
Bullish and Bearish
Bullish means expecting prices to rise, while bearish means expecting prices to fall. These terms describe market sentiment and are commonly used in crypto analysis.
FOMO, FUD and HODL
FOMO means “Fear of Missing Out” and can trigger impulsive buying. FUD means “Fear, Uncertainty and Doubt.” HODL refers to holding crypto for the long term despite price swings.
Private Key and Wallet
A crypto wallet manages the keys used to access funds on the blockchain. The private key must remain secret because anyone with access to it can control the associated assets.
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