Traders make numerous transactions daily. Buying and selling cryptocurrency is a profitable activity if based on technical analysis data. In hopes of growth, a trader places an order on the exchange. Such actions have their own names, which will be discussed in more detail.

Long position or long position

This term is basic and one of the simplest, so it's important to remember its meaning.

A long position means a trader placing an order to buy cryptocurrency. This action is most understandable to anyone.

The essence of the action is that the trader has an assumption about a possible increase in the value of the asset. They take a long position (acquire the asset) with the aim of further selling at a higher price. Selling the cryptocurrency is considered the completion of the trade and is called closing the long position. Closing occurs when the asset price rises, then the trader calculates the profit from the trade.

Examples of trades and possible risks

Trading on price increases carries risks. The trader from the above example can lose $10 if the price of Cardano approaches zero. Conversely, profit is unlimited in case of a sharp increase in the asset's value.

Basic rules

The rules are very simple. If the purchased asset appreciates, the holder of the long position makes a profit. If the asset price becomes lower than the purchase price, the trader incurs losses.

A trade is opened and closed with one mouse click; you just need to remember about the commission charged by the exchange for executing the trade.