Trading pairs are a combination of two assets that are traded against each other on an exchange. For example, in the pair BTC/USDT, bitcoin (BTC) is the base asset, while USDT is the quoted asset. The price shows how much USDT is needed to buy one BTC. Trading pairs can be crypto-crypto (e.g., BTC/BTC) and crypto-fiat (BTC/USD), depending on the exchange. They allow traders to exchange assets and profit from price differences.
When choosing trading pairs, I consider several factors. First, liquidity: pairs with high trading volume, like BTC/USDT, have a smaller spread and slippage, which reduces risks. Second, volatility: for day trading, I choose pairs with high volatility, such as altcoins against BTC, to take advantage of quick price movements. For long-term strategies, I prefer stable pairs, like ETH/USDT. Third, I analyze asset correlation: if BTC is rising, altcoins may be falling, so I look at market trends. I also check technical indicators, like RSI or trading volumes, to find entry points.
The right choice of trading pairs depends on your strategy and market conditions. Follow MiningUpdates to learn more.