How does long and short trading work in the crypto market?

1 answers

• MartinJun 17, 2023 · 2 years ago
  Long and short trading are two popular strategies in the crypto market. Long trading involves buying a cryptocurrency with the expectation that its price will increase over time. This strategy is based on the belief that the market will go up, allowing the trader to sell the cryptocurrency at a higher price and make a profit. Short trading, on the other hand, involves selling a cryptocurrency that the trader does not own, with the expectation that its price will decrease. The trader borrows the cryptocurrency from a third party, sells it at the current market price, and buys it back at a lower price to return it to the lender. The difference between the selling and buying prices is the profit. Short trading allows traders to profit from a falling market. It's important to note that both long and short trading strategies carry risks and require careful analysis of market trends and risk management.
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