#TradingPairs101 #TradingPairs101

When I first entered the trading world, I thought all currencies were only bought with dollars. I didn’t know that there was something called trading pairs, nor what the difference was between BTC/USDT and ETH/BTC, for example. After some time of learning and experimenting, I began to understand that choosing the right trading pair has a significant impact on the trade. Sometimes the currency itself is good, but the pair you are trading in may not have enough liquidity or may behave strangely.

One of the things I learned is that some pairs are more stable and easier to predict their movement, such as the pairs against USDT, because they are tied to the dollar and their price is clear. However, pairs against currencies like BTC or ETH can have more complex movements, because you are tracking two currencies at the same time, not just one.

I started to always ask myself before any trade: What is the pair that gives me the best price and execution? Do I need to revert my profits to dollars or invest them in another asset? Many times I use pairs against BNB or BTC because I don’t want to go back to cash, but I want to swap between projects. I came to know that choosing the pair depends on my goal for the trade and on the overall market condition.

Choosing the pair became part of my decision; I no longer trade just because I saw a currency rising. I must see with which currency I will trade it and how this pair has moved over the past days. I learned to monitor volume, liquidity, and spread before I open the trade. And that is a big difference from the old days when I used to just hit buy and that was it. (Quoted)