What are long and short
🎯 Lesson 1. What are long and short (in simple terms)
📈 Long — when you bet on a rise
Example:
Bought bitcoin for $20,000.
Sold for $25,000.
Profit: $5,000.
Logic: "It's cheap now, it will be more expensive later — I'll buy now and sell later."
📉 Short — when you bet on a decline
Example:
You "borrowed" 1 BTC from the exchange for $25,000.
Sold it immediately.
The price dropped to $20,000.
Bought back 1 BTC for $20,000.
Paid back the debt to the exchange.
Profit: $5,000 (on the difference).
Logic: "It's expensive now, it will be cheaper later — I'll sell now, buy later."
🤯 Important point: you are selling what you do not have
This is possible on Binance through:
Margin trading — the exchange lends you an asset.
Futures — you open a contract for a decline.
🧠 A simple analogy
📦 Let's say you borrowed a box of apples from your neighbor:
Right now, apples are expensive on the market — $10 per kg.
You sell the entire box.
A week later, the price dropped to $5 per kg.
You buy a new box and return it to your neighbor.
And the difference (from selling and buying) — you keep as pure profit.
💡 Conclusion
✅ You earn on a rise by buying → then selling.
✅ You earn on a decline by selling → then buying back cheaper.
✅ The main thing is to correctly guess the market direction.