Long and short positions, explained
You must confirm the subscription in your inbox.”,”subscribe_email_required”:”Email required”,”subscribe_email_invalid”:”A valid email address must be provided. “,”shares”:”Total shares”,”views”:”Total views”,”sponsoredBadge”:”stretch_banners.sponsored.badge”}” :post=”{“id”:53897,”seo_title”:”Long and short positions, explained”,”seo_description”:”Discover the intricacies of short and long positions in crypto trading. These principles can be applied by both new and experienced traders”,”keywords”:”Blockchain,Cryptocurrency Exchange,Trading”,”canonical”:”https://cointelegraph.com/explained/long-and-short-positions-explained”,”thumb”:”https://images.cointelegraph.com/images/1024_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy8wZDhhMTE4OTczZTkxNDUyZGFmZjU5NGE3ZGE3YTYwNy5qcGc=.jpg”,”img”:”https://images.cointelegraph.com/images/2048_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy8wZDhhMTE4OTczZTkxNDUyZGFmZjU5NGE3ZGE3YTYwNy5qcGc=.jpg”,”youtube”:””,”og_title”:”Long and short positions, explained”,”og_description”:”Discover the intricacies of short and long positions in crypto trading. These principles can be applied by both new and experienced traders.”,”twitter_title”:”Long and short positions, explained”,”twitter_description”:”Discover the intricacies of short and long positions in crypto trading. These principles can be applied by both new and experienced traders.”,”published”:”2020-10-05T20:08:00+01:00″,”noindex”:0,”modified”:”2020-10-05T20:21:26+01:00″,”title”:”Long and short positions, explained”,”leadtext”:”Discover the intricacies of short and long positions in crypto trading. These principles can be applied by both new and experienced traders.”,”amp”:”https://cointelegraph.com/explained/long-and-short-positions-explained/amp”,”alternates”:[],”alternatesLinks”:[],”url”:”long-and-short-positions-explained”,”url_full”:”/explained/long-and-short-positions-explained”,”category”:{“id”:65,”url”:”explained”,”priority”:0,”created”:null,”modified”:null,”parent_id”:0,”is_hidden”:0,”created_at”:”-0001-11-30 00:00:00″,”updated_at”:”2019-03-12 14:52:37″,”deleted_at”:null,”admin_weight”:30,”enabled”:1,”is_blog”:0,”relevant”:1,”category_id”:65,”language_id”:1,”title”:”Explained”,”alt”:””,”keywords”:””,”seo_title”:”Explained: articles for beginners about cryptocurrency and blockchain.”,”description”:”
What is Bitcoin? How does blockchain work? How to mine cryptocurrency? We are glad to help you answer these questions with our quick guides in Explained section.
n”,”seo_description”:”What is Bitcoin? How does blockchain work? How to mine cryptocurrency? We are glad to help you answer these questions with our quick guides in Explained section.”},”words_count”:932,”description”:”Discover the intricacies of short and long positions in crypto trading. These principles can be applied by both new and experienced traders”,”author”:{“id”:771,”title”:”Anatol Hooper”,”url”:”anatol-hooper”,”twitter”:””,”google_plus”:””,”photo”:””,”gender”:”male”,”description”:”Anatol is a big believer in the potential of blockchain, which he regards as the most important breakthrough after the Internet. He anticipates that digital currencies, security tokens, and DeFi will gradually replace fiat money, company stocks and traditional finance.”,”facebook”:””,”email”:”anatol.hooper@cointelegraph.com”,”linkedin”:””,”created_at”:”2019-10-30 13:13:24″,”updated_at”:”2020-02-13 14:50:55″,”deleted_at”:null,”avatar”:”https://cointelegraph.com/assets/img/icons/author_male.jpg”,”hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL2FuYXRvbC1ob29wZXI=”,”relativeUrl”:”https://cointelegraph.com/authors/anatol-hooper”,”user_id”:771,”language_id”:1,”name”:”Anatol Hooper”,”desc”:”Anatol is a big believer in the potential of blockchain, which he regards as the most important breakthrough after the Internet. He anticipates that digital currencies, security tokens, and DeFi will gradually replace fiat money, company stocks and traditional finance.”,”seo_title”:””,”seo_description”:””,”enabled”:0,”show_in_authors”:0,”show_in_experts”:0},”category_id”:65,”audio”:”https://s3.cointelegraph.com/audio/53897.58a5b7c0-81a8-40fe-bc08-2af8beb3788d.mp3″,”tags”:[{“name”:”Blockchain”,”uri”:”/tags/blockchain”,”super”:1,”page_title”:”Blockchain News”},{“name”:”Cryptocurrency Exchange”,”uri”:”/tags/cryptocurrency-exchange”,”super”:0,”page_title”:”Cryptocurrency Exchange News”},{“name”:”Trading”,”uri”:”/tags/trading”,”super”:0,”page_title”:”Trading News”}],”tag_title”:”Blockchain”,”date”:”36 MINUTES AGO”,”badge”:{“title”:”Explained”,”label”:”default”},”qty”:3,”stats_pixel”:”“,”stats_pixel_url”:”https://zoa.cointelegraph.com/pixel?postId=53897®ionId=1″,”shares”:0,”infographic”:false,”sponsored”:false,”explained”:true,”press_release”:false,”show_referral”:false,”social_description”:”Unlike stock trading, which makes it more difficult to go short, cryptocurrencies allow traders to go both directions with ease. Read this article to find out the nuances of each of the two positions. #Sponsored”,”social_translators”:{“clipboard_popup_label”:”Link copied”,”socialWechatFooterError”:”WeChat error”,”socialWechatFooterText”:”WeChat share”,”socialWechatHeaderText”:”WeChat share”},”social_shares”:{“post_id”:53897,”post_url”:”https://cointelegraph.com/explained/long-and-short-positions-explained”,”post_titles”:{“normal”:”Long and short positions, explained”,”twitter”:”Long and short positions, explained”},”post_text”:{“normal”:”Long and short positions, explained”,”twitter”:”Long and short positions, explained https://cointelegraph.com/explained/long-and-short-positions-explained via @cointelegraph”},”accounts”:{“twitter”:”@cointelegraph”}},”socials”:{“facebook”:{“url”:”https://www.facebook.com/sharer/sharer.php?u=https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained”,”count”:null,”short”:”fb”,”fa”:”facebook”},”twitter”:{“url”:”https://twitter.com/intent/tweet?text=Long+and+short+positions%2C+explained https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained via @cointelegraph”,”count”:null,”short”:”tw”,”fa”:”twitter”},”telegram”:{“url”:”https://telegram.me/share/url?url=https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained &text=Long+and+short+positions%2C+explained”,”count”:null,”short”:”tg”,”fa”:”paper-plane”},”whatsapp”:{“url”:”https://api.whatsapp.com/send?text=Long+and+short+positions%2C+explained&href=https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained”,”count”:null,”short”:”wu”,”fa”:”whatsapp”},”gplus”:{“url”:”https://plus.google.com/share?url=https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained”,”count”:null,”short”:”gplus”,”fa”:”google-plus”},”reddit”:{“url”:”https://www.reddit.com/submit?url=https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained&title=Long+and+short+positions%2C+explained”,”count”:null,”short”:”reddit”,”fa”:”reddit-alien”},”linkedin”:{“url”:”https://www.linkedin.com/shareArticle?mini=true&url=https%3A%2F%2Fcointelegraph.com%2Fexplained%2Flong-and-short-positions-explained&title=Long+and+short+positions%2C+explained”,”count”:null,”short”:”li”,”fa”:”linkedin”}},”hide_disclaimer”:false,”elink”:”https://pro.changelly.com/”,”etitle”:”Partnership material”,”elogo_x2″:”https://images.cointelegraph.com/images/528_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9hZmUwNWY0NDM5YmM4ZDA3ZmMwN2QxNTU4MjYwNGNhNy5wbmc=.png”,”elogo_x1″:”https://images.cointelegraph.com/images/260_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9hZmUwNWY0NDM5YmM4ZDA3ZmMwN2QxNTU4MjYwNGNhNy5wbmc=.png”,”elogo_svg”:false,”content”:[{“id”:1963,”post_id”:53897,”title”:”What are long and short positions?”,”content”:”
These two terms reflect whether a trader believes a cryptocurrency is going to rise or fall in value.
nn
Cryptocurrency traders often use industry-specific jargon that is not fully understood by newcomers. While “longs” and “shorts” are not the most technical terms — in fact, they are at the core of trading — we’ll explain the two concepts, especially for newcomers, who are likely flooding the crypto market amid the devaluation of fiat currencies due to aggressive stimulus backed by governments and central bankers.
nn
In a nutshell, long and short positions reflect the two possible directions of a price required to generate a profit. In a long position, the crypto trader hopes that the price will increase from a given point. In this case, we say that the trader “goes long,” or buys the cryptocurrency. Consequently, in a short position, the crypto trader expects the price to decline from a given point — i.e., the trader “goes short,” or sells the cryptocurrency.
nn
While buying and selling is typical for spot exchanges, you can go long or short on a cryptocurrency without actually buying or selling it. This is possible on derivatives exchanges that offer futures, options, contracts for differences, and other derivatives products. When you trade these derivatives, you get exposure to cryptocurrencies via long and short positions but without “physically” owning or dealing with them.
nn
That being said, you will see more long positions versus shorts in a bullish market, as more traders want to benefit from the price ascension. When the market is bearish, short positions generally exceed the long ones. However, this is only an observation and not a rule to follow. Professional traders and investors usually buy the dips and sell the rips — i.e., they open long positions when the price retreats from recent peaks and sell the cryptocurrency when the price tests resistance levels.
nnnnnn”,”created_at”:”2020-10-05 20:12:42″,”updated_at”:”2020-10-05 20:21:27″,”sort”:1,”translations”:{“id”:1956,”explained_post_id”:1963,”title_en”:”What are long and short positions?”,”content_en”:”
These two terms reflect whether a trader believes a cryptocurrency is going to rise or fall in value.
nn
Cryptocurrency traders often use industry-specific jargon that is not fully understood by newcomers. While “longs” and “shorts” are not the most technical terms — in fact, they are at the core of trading — we’ll explain the two concepts, especially for newcomers, who are likely flooding the crypto market amid the devaluation of fiat currencies due to aggressive stimulus backed by governments and central bankers.
nn
In a nutshell, long and short positions reflect the two possible directions of a price required to generate a profit. In a long position, the crypto trader hopes that the price will increase from a given point. In this case, we say that the trader “goes long,” or buys the cryptocurrency. Consequently, in a short position, the crypto trader expects the price to decline from a given point — i.e., the trader “goes short,” or sells the cryptocurrency.
nn
While buying and selling is typical for spot exchanges, you can go long or short on a cryptocurrency without actually buying or selling it. This is possible on derivatives exchanges that offer futures, options, contracts for differences, and other derivatives products. When you trade these derivatives, you get exposure to cryptocurrencies via long and short positions but without “physically” owning or dealing with them.
nn
That being said, you will see more long positions versus shorts in a bullish market, as more traders want to benefit from the price ascension. When the market is bearish, short positions generally exceed the long ones. However, this is only an observation and not a rule to follow. Professional traders and investors usually buy the dips and sell the rips — i.e., they open long positions when the price retreats from recent peaks and sell the cryptocurrency when the price tests resistance levels.
nnnnnn”,”title_es”:””,”content_es”:”nnnn”,”title_cn”:””,”content_cn”:”nnnn”,”title_de”:””,”content_de”:”nnnn”,”title_it”:””,”content_it”:”nnnn”,”title_ar”:””,”content_ar”:”nnnn”,”title_br”:””,”content_br”:”nnnn”,”title_jp”:””,”content_jp”:”nnnn”,”created_at”:”2020-10-05 20:12:42″,”updated_at”:”2020-10-05 20:21:27″,”title_kr”:””,”content_kr”:”nnnn”,”title_tr”:””,”content_tr”:”nnnn”}},{“id”:1964,”post_id”:53897,”title”:”When should a long position be opened?”,”content”:”
Traders should go long when they expect the price of a cryptocurrency to increase.
nn
You may be interested in going long when you feel the price of a cryptocurrency is about to go up for a while, depending on the time frame with which you are operating. For example, if you are trading on the daily chart and believe that the price will increase during the following days or even weeks, you can go long. You can either buy the asset on a spot exchange or open a long position via futures, options or other derivatives contracts.
nn
Obviously, your decision must be backed by some kind of fundamental or technical analysis. For example, if you find out that a blockchain project has secured a high-profile partnership or is implementing an important upgrade, you might think about going long on its native token. Generally, you should be very active on social media and read news on a regular basis in order to accurately comprehend the market sentiment. Alternatively, or on top of that, you can look for patterns on the charts and check, for example, whether the price has broken above an important resistance line, which might indicate the extension of an uptrend.
nn
No matter what kind of analysis you rely on, you should be confident that the price will go up if you plan to go long. Otherwise, you will end up going against the market.
nn
Unlike foreign exchange pairs, which have no particular long-term target, cryptocurrencies act like company shares in the sense that they are usually traded against fiat currencies, particularly the U.S. dollar, and they always strive to go higher. This is why you will see many investors who prefer to stick to the “buy and hold” strategy, especially when it comes to Bitcoin.
nnnnnn”,”created_at”:”2020-10-05 20:13:53″,”updated_at”:”2020-10-05 20:21:27″,”sort”:2,”translations”:{“id”:1957,”explained_post_id”:1964,”title_en”:”When should a long position be opened?”,”content_en”:”
Traders should go long when they expect the price of a cryptocurrency to increase.
nn
You may be interested in going long when you feel the price of a cryptocurrency is about to go up for a while, depending on the time frame with which you are operating. For example, if you are trading on the daily chart and believe that the price will increase during the following days or even weeks, you can go long. You can either buy the asset on a spot exchange or open a long position via futures, options or other derivatives contracts.
nn
Obviously, your decision must be backed by some kind of fundamental or technical analysis. For example, if you find out that a blockchain project has secured a high-profile partnership or is implementing an important upgrade, you might think about going long on its native token. Generally, you should be very active on social media and read news on a regular basis in order to accurately comprehend the market sentiment. Alternatively, or on top of that, you can look for patterns on the charts and check, for example, whether the price has broken above an important resistance line, which might indicate the extension of an uptrend.
nn
No matter what kind of analysis you rely on, you should be confident that the price will go up if you plan to go long. Otherwise, you will end up going against the market.
nn
Unlike foreign exchange pairs, which have no particular long-term target, cryptocurrencies act like company shares in the sense that they are usually traded against fiat currencies, particularly the U.S. dollar, and they always strive to go higher. This is why you will see many investors who prefer to stick to the “buy and hold” strategy, especially when it comes to Bitcoin.
nnnnnn”,”title_es”:””,”content_es”:”nnnn”,”title_cn”:””,”content_cn”:”nnnn”,”title_de”:””,”content_de”:”nnnn”,”title_it”:””,”content_it”:”nnnn”,”title_ar”:””,”content_ar”:”nnnn”,”title_br”:””,”content_br”:”nnnn”,”title_jp”:””,”content_jp”:”nnnn”,”created_at”:”2020-10-05 20:13:53″,”updated_at”:”2020-10-05 20:21:27″,”title_kr”:””,”content_kr”:”nnnn”,”title_tr”:””,”content_tr”:”nnnn”}},{“id”:1965,”post_id”:53897,”title”:”When should traders go short?”,”content”:”
Traders should go long when they expect the price of a cryptocurrency to increase.
nn
You may be interested in going long when you feel the price of a cryptocurrency is about to go up for a while, depending on the time frame with which you are operating. For example, if you are trading on the daily chart and believe that the price will increase during the following days or even weeks, you can go long. You can either buy the asset on a spot exchange or open a long position via futures, options or other derivatives contracts.
nn
Obviously, your decision must be backed by some kind of fundamental or technical analysis. For example, if you find out that a blockchain project has secured a high-profile partnership or is implementing an important upgrade, you might think about going long on its native token. Generally, you should be very active on social media and read news on a regular basis in order to accurately comprehend the market sentiment. Alternatively, or on top of that, you can look for patterns on the charts and check, for example, whether the price has broken above an important resistance line, which might indicate the extension of an uptrend.
nn
No matter what kind of analysis you rely on, you should be confident that the price will go up if you plan to go long. Otherwise, you will end up going against the market.
nn
Unlike foreign exchange pairs, which have no particular long-term target, cryptocurrencies act like company shares in the sense that they are usually traded against fiat currencies, particularly the U.S. dollar, and they always strive to go higher. This is why you will see many investors who prefer to stick to the “buy and hold” strategy, especially when it comes to Bitcoin.
nnnnnn”,”created_at”:”2020-10-05 20:14:27″,”updated_at”:”2020-10-05 20:21:27″,”sort”:3,”translations”:{“id”:1958,”explained_post_id”:1965,”title_en”:”When should traders go short?”,”content_en”:”
Traders should go long when they expect the price of a cryptocurrency to increase.
nn
You may be interested in going long when you feel the price of a cryptocurrency is about to go up for a while, depending on the time frame with which you are operating. For example, if you are trading on the daily chart and believe that the price will increase during the following days or even weeks, you can go long. You can either buy the asset on a spot exchange or open a long position via futures, options or other derivatives contracts.
nn
Obviously, your decision must be backed by some kind of fundamental or technical analysis. For example, if you find out that a blockchain project has secured a high-profile partnership or is implementing an important upgrade, you might think about going long on its native token. Generally, you should be very active on social media and read news on a regular basis in order to accurately comprehend the market sentiment. Alternatively, or on top of that, you can look for patterns on the charts and check, for example, whether the price has broken above an important resistance line, which might indicate the extension of an uptrend.
nn
No matter what kind of analysis you rely on, you should be confident that the price will go up if you plan to go long. Otherwise, you will end up going against the market.
nn
Unlike foreign exchange pairs, which have no particular long-term target, cryptocurrencies act like company shares in the sense that they are usually traded against fiat currencies, particularly the U.S. dollar, and they always strive to go higher. This is why you will see many investors who prefer to stick to the “buy and hold” strategy, especially when it comes to Bitcoin.
nnnnnn”,”title_es”:””,”content_es”:”nnnn”,”title_cn”:””,”content_cn”:”nnnn”,”title_de”:””,”content_de”:”nnnn”,”title_it”:””,”content_it”:”nnnn”,”title_ar”:””,”content_ar”:”nnnn”,”title_br”:””,”content_br”:”nnnn”,”title_jp”:””,”content_jp”:”nnnn”,”created_at”:”2020-10-05 20:14:27″,”updated_at”:”2020-10-05 20:21:27″,”title_kr”:””,”content_kr”:”nnnn”,”title_tr”:””,”content_tr”:”nnnn”}},{“id”:1966,”post_id”:53897,”title”:”When should traders go short?”,”content”:”
Traders should go short when they expect the price of a cryptocurrency to decline.
nn
You may be interested in going short on a particular cryptocurrency when you expect its price to decline for a while.
nn
As explained above, you should back your decision with solid market analysis. As a rule, short-sellers open their positions when the market has reached an overbought level — i.e., it has increased for a long period and the uptrend might have supersaturated. Also, going short makes sense when the price cannot break a resistance level and starts departing from it.
nn
Since the cryptocurrency market is still at an emerging stage, Bitcoin (BTC) and altcoins can often display sharp fluctuations without any fundamentals backing the moves, which makes the analysis process a bit tricky. However, you should always be aware of all the factors impacting the market before going long or short.
nnnnnn”,”created_at”:”2020-10-05 20:14:54″,”updated_at”:”2020-10-05 20:21:27″,”sort”:4,”translations”:{“id”:1959,”explained_post_id”:1966,”title_en”:”When should traders go short?”,”content_en”:”
Traders should go short when they expect the price of a cryptocurrency to decline.
nn
You may be interested in going short on a particular cryptocurrency when you expect its price to decline for a while.
nn
As explained above, you should back your decision with solid market analysis. As a rule, short-sellers open their positions when the market has reached an overbought level — i.e., it has increased for a long period and the uptrend might have supersaturated. Also, going short makes sense when the price cannot break a resistance level and starts departing from it.
nn
Since the cryptocurrency market is still at an emerging stage, Bitcoin (BTC) and altcoins can often display sharp fluctuations without any fundamentals backing the moves, which makes the analysis process a bit tricky. However, you should always be aware of all the factors impacting the market before going long or short.
nnnnnn”,”title_es”:””,”content_es”:”nnnn”,”title_cn”:””,”content_cn”:”nnnn”,”title_de”:””,”content_de”:”nnnn”,”title_it”:””,”content_it”:”nnnn”,”title_ar”:””,”content_ar”:”nnnn”,”title_br”:””,”content_br”:”nnnn”,”title_jp”:””,”content_jp”:”nnnn”,”created_at”:”2020-10-05 20:14:54″,”updated_at”:”2020-10-05 20:21:27″,”title_kr”:””,”content_kr”:”nnnn”,”title_tr”:””,”content_tr”:”nnnn”}},{“id”:1967,”post_id”:53897,”title”:”Where can you go long or short?”,”content”:”
You can go long or short on any cryptocurrency exchange or trading platform.
nn
You can open long and short positions on any cryptocurrency exchange that provides spot or derivatives trading services.
nn
Traders usually opt for well-established platforms such as Coinbase or Binance, among others. Coinbase is the largest crypto exchange in the United States, while Binance is one of the fastest-growing crypto trading platforms in the world. It offers a wide range of services, including spot, futures, options and over-the-counter trading.
nn
It’s worth mentioning that Coinbase and Binance, as well as other popular exchanges, might seem sophisticated for newcomers. If you are new to crypto trading and are seeking a more straightforward experience, you can look into Changelly Pro. While it offers multiple features, trading on Changelly Pro is simple due to its intuitive dashboards and a terminal. However, it’s not only for beginners — seasoned traders can also open long and short positions on Changelly Pro, as the terminal comes with many different tools and perks, including a multicurrency wallet, security layers and multiple order types, among other features.
nnnnnn”,”created_at”:”2020-10-05 20:15:22″,”updated_at”:”2020-10-05 20:21:26″,”sort”:5,”translations”:{“id”:1960,”explained_post_id”:1967,”title_en”:”Where can you go long or short?”,”content_en”:”
You can go long or short on any cryptocurrency exchange or trading platform.
nn
You can open long and short positions on any cryptocurrency exchange that provides spot or derivatives trading services.
nn
Traders usually opt for well-established platforms such as Coinbase or Binance, among others. Coinbase is the largest crypto exchange in the United States, while Binance is one of the fastest-growing crypto trading platforms in the world. It offers a wide range of services, including spot, futures, options and over-the-counter trading.
nn
It’s worth mentioning that Coinbase and Binance, as well as other popular exchanges, might seem sophisticated for newcomers. If you are new to crypto trading and are seeking a more straightforward experience, you can look into Changelly Pro. While it offers multiple features, trading on Changelly Pro is simple due to its intuitive dashboards and a terminal. However, it’s not only for beginners — seasoned traders can also open long and short positions on Changelly Pro, as the terminal comes with many different tools and perks, including a multicurrency wallet, security layers and multiple order types, among other features.
nnnnnn”,”title_es”:””,”content_es”:”nnnn”,”title_cn”:””,”content_cn”:”nnnn”,”title_de”:””,”content_de”:”nnnn”,”title_it”:””,”content_it”:”nnnn”,”title_ar”:””,”content_ar”:”nnnn”,”title_br”:””,”content_br”:”nnnn”,”title_jp”:””,”content_jp”:”nnnn”,”created_at”:”2020-10-05 20:15:22″,”updated_at”:”2020-10-05 20:21:26″,”title_kr”:””,”content_kr”:”nnnn”,”title_tr”:””,”content_tr”:”nnnn”}},{“id”:1968,”post_id”:53897,”title”:”How can margin trading amplify the targets of long and short positions?”,”content”:”
Margin trading can magnify the potential results of long and short positions thanks to leverage — i.e., borrowed funds.
nn
Going long or short might be lucrative, especially when the cryptocurrency is volatile. Still, professional traders prefer margin trading, as they can amplify potential profits by several times. However, the risks also increase by the same degree, which is why margin trading should be used with caution.
nn
Margin trading involves trading with leverage, and it can be useful for both long and short positions. Margin accounts use funds provided by third parties — e.g., the exchange platform or other traders who are incentivized for contributing their funds. Thus, you can invest greater amounts by leveraging positions and magnify the potential profit by several times.
nn
The required sum that you have to commit as a percentage of the total order amount is called margin, hence the name. As for the leverage, it represents the ratio of the borrowed funds to the margin. For example, if you want to open a long position worth $10,000 with 10-to-one leverage (or 10x leverage), you will have to invest $1,000 of your own money.
nn
Margin trading is a method to boost the potential profits of your long and short positions.
nn
Learn more about Changelly Pro
nn
n
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.
n
nnnnnn”,”created_at”:”2020-10-05 20:17:08″,”updated_at”:”2020-10-05 20:21:26″,”sort”:6,”translations”:{“id”:1961,”explained_post_id”:1968,”title_en”:”How can margin trading amplify the targets of long and short positions?”,”content_en”:”
Margin trading can magnify the potential results of long and short positions thanks to leverage — i.e., borrowed funds.
nn
Going long or short might be lucrative, especially when the cryptocurrency is volatile. Still, professional traders prefer margin trading, as they can amplify potential profits by several times. However, the risks also increase by the same degree, which is why margin trading should be used with caution.
nn
Margin trading involves trading with leverage, and it can be useful for both long and short positions. Margin accounts use funds provided by third parties — e.g., the exchange platform or other traders who are incentivized for contributing their funds. Thus, you can invest greater amounts by leveraging positions and magnify the potential profit by several times.
nn
The required sum that you have to commit as a percentage of the total order amount is called margin, hence the name. As for the leverage, it represents the ratio of the borrowed funds to the margin. For example, if you want to open a long position worth $10,000 with 10-to-one leverage (or 10x leverage), you will have to invest $1,000 of your own money.
nn
Margin trading is a method to boost the potential profits of your long and short positions.
nn
Learn more about Changelly Pro
nn
n
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.
n
nnnnnn”,”title_es”:””,”content_es”:”nnnn”,”title_cn”:””,”content_cn”:”nnnn”,”title_de”:””,”content_de”:”nnnn”,”title_it”:””,”content_it”:”nnnn”,”title_ar”:””,”content_ar”:”nnnn”,”title_br”:””,”content_br”:”nnnn”,”title_jp”:””,”content_jp”:”nnnn”,”created_at”:”2020-10-05 20:17:08″,”updated_at”:”2020-10-05 20:21:26″,”title_kr”:””,”content_kr”:”nnnn”,”title_tr”:””,”content_tr”:”nnnn”}}],”is_partner_material”:true,”commentsSection”:{“schemaEntityUrl”:”//cointelegraph.com/explained/long-and-short-positions-explained”,”list”:[],”amount”:0,”i18n”:{“addComment”:”Add a comment…”,”amountOnePostfix”:”Comment”,”amountPostfix”:”Comments”,”cancel”:”Cancel”,”delete”:”Delete”,”edit”:”Edit”,”errorBig”:”Comment text cannot be longer than 2000 characters”,”errorDuplicate”:”Duplicate comment”,”errorSmall”:”Comment text must be at least 2 characters long”,”hideButton”:”Hide comments”,”noComments”:” “,”commentOnModeration”:”Comment on moderation”,”postComment”:”Post”,”reply”:”Reply”,”showAllComments”:”Show All Comments”,”showButtonPostfix”:”comments”,”showButtonPrefix”:”Show”,”signIn”:”Sign in”,”update”:”Update comment”,”commentWasDeleted”:”This comment has been deleted”}},”related”:[{“id”:46588,”retina”:”https://images.cointelegraph.com/images/1480_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9lNGIxZDQ2ODQwNDY0NmVjNzcwMWMyOGZlY2JiZmIwNC5qcGc=.jpg”,”img”:”https://images.cointelegraph.com/images/740_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9lNGIxZDQ2ODQwNDY0NmVjNzcwMWMyOGZlY2JiZmIwNC5qcGc=.jpg”,”thumb”:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9lNGIxZDQ2ODQwNDY0NmVjNzcwMWMyOGZlY2JiZmIwNC5qcGc=.jpg”,”thumb370″:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9lNGIxZDQ2ODQwNDY0NmVjNzcwMWMyOGZlY2JiZmIwNC5qcGc=.jpg”,”amp_thumb”:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9lNGIxZDQ2ODQwNDY0NmVjNzcwMWMyOGZlY2JiZmIwNC5qcGc=.jpg”,”thumb150″:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9lNGIxZDQ2ODQwNDY0NmVjNzcwMWMyOGZlY2JiZmIwNC5qcGc=.jpg”,”url”:”https://cointelegraph.com/news/crypto-crime-on-the-rise-good-odds-of-2020-becoming-a-record-breaker”,”title”:”Crypto Crime on the Rise — Good Odds of 2020 Becoming a Record-Breaker”,”lead”:”Experts believe that a more holistic crypto ecosystem, especially one that is more AML-centric, is needed to help prevent the spread of crypto scams in 2020.”,”leadfull”:””,”category_id”:19,”category_url”:”https://cointelegraph.com/category/analysis”,”category_title”:”Analysis”,”author_url”:”https://cointelegraph.com/authors/shiraz-jagati”,”author_hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL3NoaXJhei1qYWdhdGk=”,”author_title”:”Shiraz Jagati”,”author_img”:”https://images.cointelegraph.com/images/32_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80NWFkZTVhZDI3NmQyOGMwNjZhMjA2NGE1MTc1ZDNhMy5qcGc=.jpg”,”date”:”JUN 07, 2020″,”flash_date”:”JUN 07, 2020″,”sponsored”:false,”press_release”:false,”sponsored_label”:”Sponsored”,”explained”:false,”badge”:{“title”:”Analysis”,”label”:”info”},”published”:{“date”:”2020-06-07 09:00:00.000000″,”timezone_type”:3,”timezone”:”Europe/London”},”stat_uniqs”:19662,”rss_date”:”Sun, 07 Jun 2020 09:00:00 +0100″,”publishedW3″:”2020-06-07T09:00:00+01:00″,”show_referral”:true,”isMagazine”:false},{“id”:53554,”retina”:”https://images.cointelegraph.com/images/1480_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9jMzY1N2U3NjcwYTk1YjVlZTY1NDMyOTVjYjU1YmQ2Zi5qcGc=.jpg”,”img”:”https://images.cointelegraph.com/images/740_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9jMzY1N2U3NjcwYTk1YjVlZTY1NDMyOTVjYjU1YmQ2Zi5qcGc=.jpg”,”thumb”:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9jMzY1N2U3NjcwYTk1YjVlZTY1NDMyOTVjYjU1YmQ2Zi5qcGc=.jpg”,”thumb370″:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9jMzY1N2U3NjcwYTk1YjVlZTY1NDMyOTVjYjU1YmQ2Zi5qcGc=.jpg”,”amp_thumb”:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9jMzY1N2U3NjcwYTk1YjVlZTY1NDMyOTVjYjU1YmQ2Zi5qcGc=.jpg”,”thumb150″:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9jMzY1N2U3NjcwYTk1YjVlZTY1NDMyOTVjYjU1YmQ2Zi5qcGc=.jpg”,”url”:”https://cointelegraph.com/news/could-this-blockchain-protocol-reduce-exposure-to-pos-slashing-risks”,”title”:”Could this blockchain protocol reduce exposure to PoS slashing risks?”,”lead”:”A new blockchain protocol plans to allow anyone to hedge against the risk of service delays and disruption across multiple industries, including proof-of-stake …”,”leadfull”:””,”category_id”:62,”category_url”:”https://cointelegraph.com/category/sponsored”,”category_title”:”Sponsored”,”author_url”:”https://cointelegraph.com/authors/connor-blenkinsop”,”author_hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL2Nvbm5vci1ibGVua2luc29w”,”author_title”:”Connor Blenkinsop”,”author_img”:”https://cointelegraph.com/assets/img/icons/author_male.jpg”,”date”:”SEP 29, 2020″,”flash_date”:”SEP 29, 2020″,”sponsored”:true,”press_release”:false,”sponsored_label”:”Sponsored”,”explained”:false,”badge”:{“title”:”Sponsored”,”label”:”default”},”published”:{“date”:”2020-09-29 16:06:00.000000″,”timezone_type”:3,”timezone”:”Europe/London”},”stat_uniqs”:4162,”rss_date”:”Tue, 29 Sep 2020 16:06:00 +0100″,”publishedW3″:”2020-09-29T16:06:00+01:00″,”show_referral”:true,”isMagazine”:false},{“id”:52275,”retina”:”https://images.cointelegraph.com/images/1480_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvZjFhYmZhNWMtODNiMS00NGFlLTkyNWMtNDBmNzg2MjIwMDVlLmpwZw==.jpg”,”img”:”https://images.cointelegraph.com/images/740_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvZjFhYmZhNWMtODNiMS00NGFlLTkyNWMtNDBmNzg2MjIwMDVlLmpwZw==.jpg”,”thumb”:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvZjFhYmZhNWMtODNiMS00NGFlLTkyNWMtNDBmNzg2MjIwMDVlLmpwZw==.jpg”,”thumb370″:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvZjFhYmZhNWMtODNiMS00NGFlLTkyNWMtNDBmNzg2MjIwMDVlLmpwZw==.jpg”,”amp_thumb”:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvZjFhYmZhNWMtODNiMS00NGFlLTkyNWMtNDBmNzg2MjIwMDVlLmpwZw==.jpg”,”thumb150″:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvZjFhYmZhNWMtODNiMS00NGFlLTkyNWMtNDBmNzg2MjIwMDVlLmpwZw==.jpg”,”url”:”https://cointelegraph.com/news/how-to-provide-liquidity-to-cryptocurrency-exchange”,”title”:”How to provide liquidity to cryptocurrency exchange”,”lead”:”Liquidity is one of the most important factors in a cryptocurrency exchange or brokerage’s long term success.”,”leadfull”:””,”category_id”:81,”category_url”:”https://cointelegraph.com/category/opinion”,”category_title”:”Opinion “,”author_url”:”https://cointelegraph.com/authors/guest-authors”,”author_hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL2d1ZXN0LWF1dGhvcnM=”,”author_title”:”Guest Authors”,”author_img”:”https://cointelegraph.com/assets/img/icons/author_male.jpg”,”date”:”SEP 07, 2020″,”flash_date”:”SEP 07, 2020″,”sponsored”:false,”press_release”:false,”sponsored_label”:”Sponsored”,”explained”:false,”badge”:{“title”:”Opinion”,”label”:”success”},”published”:{“date”:”2020-09-07 15:00:00.000000″,”timezone_type”:3,”timezone”:”Europe/London”},”stat_uniqs”:10303,”rss_date”:”Mon, 07 Sep 2020 15:00:00 +0100″,”publishedW3″:”2020-09-07T15:00:00+01:00″,”show_referral”:true,”isMagazine”:false},{“id”:53372,”retina”:”https://images.cointelegraph.com/images/1480_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvNmY2NTE5OWItNWNkNC00YWUxLWIzYjItYjA5ZDA1ODYyYWU4LmpwZw==.jpg”,”img”:”https://images.cointelegraph.com/images/740_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvNmY2NTE5OWItNWNkNC00YWUxLWIzYjItYjA5ZDA1ODYyYWU4LmpwZw==.jpg”,”thumb”:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvNmY2NTE5OWItNWNkNC00YWUxLWIzYjItYjA5ZDA1ODYyYWU4LmpwZw==.jpg”,”thumb370″:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvNmY2NTE5OWItNWNkNC00YWUxLWIzYjItYjA5ZDA1ODYyYWU4LmpwZw==.jpg”,”amp_thumb”:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvNmY2NTE5OWItNWNkNC00YWUxLWIzYjItYjA5ZDA1ODYyYWU4LmpwZw==.jpg”,”thumb150″:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvNmY2NTE5OWItNWNkNC00YWUxLWIzYjItYjA5ZDA1ODYyYWU4LmpwZw==.jpg”,”url”:”https://cointelegraph.com/news/why-centralized-exchanges-will-lead-crypto-to-the-future”,”title”:”Why centralized exchanges will lead crypto to the future”,”lead”:”Will centralized exchanges continue to provide the regulated environments required for digital assets to evolve into the mainstream, or will the future belong t…”,”leadfull”:””,”category_id”:81,”category_url”:”https://cointelegraph.com/category/opinion”,”category_title”:”Opinion “,”author_url”:”https://cointelegraph.com/authors/paolo-ardoino”,”author_hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL3Bhb2xvLWFyZG9pbm8=”,”author_title”:”Paolo Ardoino”,”author_img”:”https://cointelegraph.com/assets/img/icons/author_male.jpg”,”date”:”SEP 25, 2020″,”flash_date”:”SEP 25, 2020″,”sponsored”:false,”press_release”:false,”sponsored_label”:”Sponsored”,”explained”:false,”badge”:{“title”:”Opinion”,”label”:”success”},”published”:{“date”:”2020-09-25 15:00:00.000000″,”timezone_type”:3,”timezone”:”Europe/London”},”stat_uniqs”:4812,”rss_date”:”Fri, 25 Sep 2020 15:00:00 +0100″,”publishedW3″:”2020-09-25T15:00:00+01:00″,”show_referral”:true,”isMagazine”:false},{“id”:53445,”retina”:”https://images.cointelegraph.com/images/1480_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80N2IzYWQ3OGRmMjU2ZTk1ZThhODhkOWJhYWY1MDQ4Ny5qcGc=.jpg”,”img”:”https://images.cointelegraph.com/images/740_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80N2IzYWQ3OGRmMjU2ZTk1ZThhODhkOWJhYWY1MDQ4Ny5qcGc=.jpg”,”thumb”:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80N2IzYWQ3OGRmMjU2ZTk1ZThhODhkOWJhYWY1MDQ4Ny5qcGc=.jpg”,”thumb370″:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80N2IzYWQ3OGRmMjU2ZTk1ZThhODhkOWJhYWY1MDQ4Ny5qcGc=.jpg”,”amp_thumb”:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80N2IzYWQ3OGRmMjU2ZTk1ZThhODhkOWJhYWY1MDQ4Ny5qcGc=.jpg”,”thumb150″:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy80N2IzYWQ3OGRmMjU2ZTk1ZThhODhkOWJhYWY1MDQ4Ny5qcGc=.jpg”,”url”:”https://cointelegraph.com/news/most-crypto-exchanges-are-vulnerable-by-design-says-bybit-ceo”,”title”:”Most crypto exchanges are vulnerable by design, says Bybit CEO”,”lead”:”He isn’t surprised attacks happen.”,”leadfull”:””,”category_id”:86,”category_url”:”https://cointelegraph.com/category/interview”,”category_title”:”Interview”,”author_url”:”https://cointelegraph.com/authors/ting-peng”,”author_hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL3RpbmctcGVuZw==”,”author_title”:”Ting Peng”,”author_img”:”https://images.cointelegraph.com/images/32_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS9zdG9yYWdlL3VwbG9hZHMvdmlldy9kZmJmOTUyYTljZDI0MmM2MDgxM2VmMWViZWU4YjNiMC5qcGc=.jpg”,”date”:”SEP 27, 2020″,”flash_date”:”SEP 27, 2020″,”sponsored”:false,”press_release”:false,”sponsored_label”:”Sponsored”,”explained”:false,”badge”:{“title”:”Interview”,”label”:”default”},”published”:{“date”:”2020-09-27 23:59:00.000000″,”timezone_type”:3,”timezone”:”Europe/London”},”stat_uniqs”:5798,”rss_date”:”Sun, 27 Sep 2020 23:59:00 +0100″,”publishedW3″:”2020-09-27T23:59:00+01:00″,”show_referral”:true,”isMagazine”:false},{“id”:53499,”retina”:”https://images.cointelegraph.com/images/1480_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvMTIxMTJjNTYtNWNkYS00Y2Y0LWIxMzQtYzc2MjRjY2NjMmJhLmpwZw==.jpg”,”img”:”https://images.cointelegraph.com/images/740_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvMTIxMTJjNTYtNWNkYS00Y2Y0LWIxMzQtYzc2MjRjY2NjMmJhLmpwZw==.jpg”,”thumb”:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvMTIxMTJjNTYtNWNkYS00Y2Y0LWIxMzQtYzc2MjRjY2NjMmJhLmpwZw==.jpg”,”thumb370″:”https://images.cointelegraph.com/images/370_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvMTIxMTJjNTYtNWNkYS00Y2Y0LWIxMzQtYzc2MjRjY2NjMmJhLmpwZw==.jpg”,”amp_thumb”:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvMTIxMTJjNTYtNWNkYS00Y2Y0LWIxMzQtYzc2MjRjY2NjMmJhLmpwZw==.jpg”,”thumb150″:”https://images.cointelegraph.com/images/150_aHR0cHM6Ly9zMy5ldS1jZW50cmFsLTEuYW1hem9uYXdzLmNvbS9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMDkvMTIxMTJjNTYtNWNkYS00Y2Y0LWIxMzQtYzc2MjRjY2NjMmJhLmpwZw==.jpg”,”url”:”https://cointelegraph.com/news/crypto-regulations-in-the-united-kingdom-are-we-there-yet”,”title”:”Crypto regulations in the United Kingdom: Are we there yet?”,”lead”:”For the U.K. to remain attractive to the crypto industry, it should strive to provide more clarity and certainty around compliance.”,”leadfull”:””,”category_id”:98,”category_url”:”https://cointelegraph.com/category/expert-take”,”category_title”:”Expert Take”,”author_url”:”https://cointelegraph.com/authors/erika-federis”,”author_hash”:”aHR0cHM6Ly9jb2ludGVsZWdyYXBoLmNvbS9hdXRob3JzL2VyaWthLWZlZGVyaXM=”,”author_title”:”Erika Federis”,”author_img”:”https://cointelegraph.com/assets/img/icons/author_female.png”,”date”:”SEP 28, 2020″,”flash_date”:”SEP 28, 2020″,”sponsored”:false,”press_release”:false,”sponsored_label”:”Sponsored”,”explained”:false,”badge”:{“title”:”Expert Take”,”label”:”info”},”published”:{“date”:”2020-09-28 20:00:00.000000″,”timezone_type”:3,”timezone”:”Europe/London”},”stat_uniqs”:4957,”rss_date”:”Mon, 28 Sep 2020 20:00:00 +0100″,”publishedW3″:”2020-09-28T20:00:00+01:00″,”show_referral”:true,”isMagazine”:false}]}” :shares=”{“facebook”:{“url”:”https://www.facebook.com/sharer/sharer.php?u=%URL%”,”icon”:”facebook”,”title”:”Facebook”,”sizesAllowed”:[{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”xs”,”label”:”Smartphones”,”breakpoint”:”> 480px”},{“size”:”xxs”,”label”:”Extra small devices”,”breakpoint”:”< 480px"}],"position":1,"status":true},"twitter":{"url":"https://twitter.com/intent/tweet?text=%TEXT%","icon":"twitter","title":"Twitter","position":2,"status":true,"sizesAllowed":[{"size":"xxs","label":"Extra small devices","breakpoint":"< 480px"},{"size":"xs","label":"Smartphones","breakpoint":"> 480px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”}]},”telegram”:{“url”:”https://t.me/share/url?url=%URL%&text=%TEXT%”,”icon”:”telegram”,”title”:”Telegram”,”position”:3,”status”:true,”sizesAllowed”:[{“size”:”xxs”,”label”:”Extra small devices”,”breakpoint”:”< 480px"},{"size":"xs","label":"Smartphones","breakpoint":"> 480px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”}]},”linkedin”:{“url”:”https://www.linkedin.com/shareArticle?mini=true&url=%URL%&title=%TITLE%”,”icon”:”linked-in”,”title”:”LinkedIn”,”position”:5,”status”:true,”sizesAllowed”:[{“size”:”xxs”,”label”:”Extra small devices”,”breakpoint”:”< 480px"},{"size":"xs","label":"Smartphones","breakpoint":"> 480px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”}]},”copy”:{“url”:”%URL%”,”icon”:”copy”,”position”:7,”title”:”Copy Link”,”sizesAllowed”:[{“size”:”xxs”,”label”:”Extra small devices”,”breakpoint”:”< 480px"},{"size":"xs","label":"Smartphones","breakpoint":"> 480px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”}],”status”:true},”whatsapp”:{“url”:”https://wa.me/?text=%TITLE% %URL%”,”icon”:”whats-app”,”title”:”Whatsapp”,”sizesAllowed”:[{“size”:”xxs”,”label”:”Extra small devices”,”breakpoint”:”< 480px"},{"size":"xs","label":"Smartphones","breakpoint":"> 480px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”}],”position”:6,”status”:true},”reddit”:{“url”:”https://www.reddit.com/submit?url=%URL%&title=%TITLE%”,”icon”:”reddit”,”title”:”Reddit”,”sizesAllowed”:[{“size”:”xxs”,”label”:”Extra small devices”,”breakpoint”:”< 480px"},{"size":"xs","label":"Smartphones","breakpoint":"> 480px”},{“size”:”sm”,”label”:”Small tablets”,”breakpoint”:”> 768px”},{“size”:”md”,”label”:”Medium devices”,”breakpoint”:”> 992px”},{“size”:”lg”,”label”:”Large devices”,”breakpoint”:”> 1200px”}],”position”:4,”status”:true}}” is=”ExplainedPostPage”>
These two terms reflect whether a trader believes a cryptocurrency is going to rise or fall in value.
Cryptocurrency traders often use industry-specific jargon that is not fully understood by newcomers. While “longs” and “shorts” are not the most technical terms — in fact, they are at the core of trading — we’ll explain the two concepts, especially for newcomers, who are likely flooding the crypto market amid the devaluation of fiat currencies due to aggressive stimulus backed by governments and central bankers.
In a nutshell, long and short positions reflect the two possible directions of a price required to generate a profit. In a long position, the crypto trader hopes that the price will increase from a given point. In this case, we say that the trader “goes long,” or buys the cryptocurrency. Consequently, in a short position, the crypto trader expects the price to decline from a given point — i.e., the trader “goes short,” or sells the cryptocurrency.
While buying and selling is typical for spot exchanges, you can go long or short on a cryptocurrency without actually buying or selling it. This is possible on derivatives exchanges that offer futures, options, contracts for differences, and other derivatives products. When you trade these derivatives, you get exposure to cryptocurrencies via long and short positions but without “physically” owning or dealing with them.
That being said, you will see more long positions versus shorts in a bullish market, as more traders want to benefit from the price ascension. When the market is bearish, short positions generally exceed the long ones. However, this is only an observation and not a rule to follow. Professional traders and investors usually buy the dips and sell the rips — i.e., they open long positions when the price retreats from recent peaks and sell the cryptocurrency when the price tests resistance levels.
Traders should go long when they expect the price of a cryptocurrency to increase.
You may be interested in going long when you feel the price of a cryptocurrency is about to go up for a while, depending on the time frame with which you are operating. For example, if you are trading on the daily chart and believe that the price will increase during the following days or even weeks, you can go long. You can either buy the asset on a spot exchange or open a long position via futures, options or other derivatives contracts.
Obviously, your decision must be backed by some kind of fundamental or technical analysis. For example, if you find out that a blockchain project has secured a high-profile partnership or is implementing an important upgrade, you might think about going long on its native token. Generally, you should be very active on social media and read news on a regular basis in order to accurately comprehend the market sentiment. Alternatively, or on top of that, you can look for patterns on the charts and check, for example, whether the price has broken above an important resistance line, which might indicate the extension of an uptrend.
No matter what kind of analysis you rely on, you should be confident that the price will go up if you plan to go long. Otherwise, you will end up going against the market.
Unlike foreign exchange pairs, which have no particular long-term target, cryptocurrencies act like company shares in the sense that they are usually traded against fiat currencies, particularly the U.S. dollar, and they always strive to go higher. This is why you will see many investors who prefer to stick to the “buy and hold” strategy, especially when it comes to Bitcoin.
Traders should go long when they expect the price of a cryptocurrency to increase.
You may be interested in going long when you feel the price of a cryptocurrency is about to go up for a while, depending on the time frame with which you are operating. For example, if you are trading on the daily chart and believe that the price will increase during the following days or even weeks, you can go long. You can either buy the asset on a spot exchange or open a long position via futures, options or other derivatives contracts.
Obviously, your decision must be backed by some kind of fundamental or technical analysis. For example, if you find out that a blockchain project has secured a high-profile partnership or is implementing an important upgrade, you might think about going long on its native token. Generally, you should be very active on social media and read news on a regular basis in order to accurately comprehend the market sentiment. Alternatively, or on top of that, you can look for patterns on the charts and check, for example, whether the price has broken above an important resistance line, which might indicate the extension of an uptrend.
No matter what kind of analysis you rely on, you should be confident that the price will go up if you plan to go long. Otherwise, you will end up going against the market.
Unlike foreign exchange pairs, which have no particular long-term target, cryptocurrencies act like company shares in the sense that they are usually traded against fiat currencies, particularly the U.S. dollar, and they always strive to go higher. This is why you will see many investors who prefer to stick to the “buy and hold” strategy, especially when it comes to Bitcoin.
Traders should go short when they expect the price of a cryptocurrency to decline.
You may be interested in going short on a particular cryptocurrency when you expect its price to decline for a while.
As explained above, you should back your decision with solid market analysis. As a rule, short-sellers open their positions when the market has reached an overbought level — i.e., it has increased for a long period and the uptrend might have supersaturated. Also, going short makes sense when the price cannot break a resistance level and starts departing from it.
Since the cryptocurrency market is still at an emerging stage, Bitcoin (BTC) and altcoins can often display sharp fluctuations without any fundamentals backing the moves, which makes the analysis process a bit tricky. However, you should always be aware of all the factors impacting the market before going long or short.
You can go long or short on any cryptocurrency exchange or trading platform.
You can open long and short positions on any cryptocurrency exchange that provides spot or derivatives trading services.
Traders usually opt for well-established platforms such as Coinbase or Binance, among others. Coinbase is the largest crypto exchange in the United States, while Binance is one of the fastest-growing crypto trading platforms in the world. It offers a wide range of services, including spot, futures, options and over-the-counter trading.
It’s worth mentioning that Coinbase and Binance, as well as other popular exchanges, might seem sophisticated for newcomers. If you are new to crypto trading and are seeking a more straightforward experience, you can look into Changelly Pro. While it offers multiple features, trading on Changelly Pro is simple due to its intuitive dashboards and a terminal. However, it’s not only for beginners — seasoned traders can also open long and short positions on Changelly Pro, as the terminal comes with many different tools and perks, including a multicurrency wallet, security layers and multiple order types, among other features.
Margin trading can magnify the potential results of long and short positions thanks to leverage — i.e., borrowed funds.
Going long or short might be lucrative, especially when the cryptocurrency is volatile. Still, professional traders prefer margin trading, as they can amplify potential profits by several times. However, the risks also increase by the same degree, which is why margin trading should be used with caution.
Margin trading involves trading with leverage, and it can be useful for both long and short positions. Margin accounts use funds provided by third parties — e.g., the exchange platform or other traders who are incentivized for contributing their funds. Thus, you can invest greater amounts by leveraging positions and magnify the potential profit by several times.
The required sum that you have to commit as a percentage of the total order amount is called margin, hence the name. As for the leverage, it represents the ratio of the borrowed funds to the margin. For example, if you want to open a long position worth $10,000 with 10-to-one leverage (or 10x leverage), you will have to invest $1,000 of your own money.
Margin trading is a method to boost the potential profits of your long and short positions.
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.
