🔁 #TradingPairs101 – Understand Trading Pairs for Smarter Trading
A trading pair consists of a base asset (being bought/sold) and a quote asset (used for valuation). For example, in the BTC/USDT pair, BTC is the base asset, while USDT is the quote asset – you are buying/selling BTC using USDT.
💡 Trade with Stablecoins or Crypto?
I usually prefer trading with stablecoins (USDT, BUSD, etc.) because:
It’s easier to control profits/losses with a stable valuation currency.
Avoid double impact when both assets are volatile (e.g., ETH/BTC). However, in a strong bull market, I also trade crypto-crypto pairs to optimize profits when both assets are increasing in value.
📌 How to choose the right trading pair:
Prioritize pairs with high liquidity and large volumes.
Choose a quote asset that aligns with your strategy (e.g., whether you want to "exit" to stablecoin or hold the base coin).
Evaluate the trends of each asset in the pair – avoid trading when both are declining.
⚠️ A memorable lesson:
I traded ETH/BTC when both were increasing – thought I was making a profit but in reality, ETH was increasing slower than BTC, causing me to lose compared to just holding BTC. After that, I switched to USDT as the quote asset for easier performance tracking.
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👉 Don’t just look at the coin you like, choose the right trading pair to align with your strategy and goals!
Share your insights with #TradingPairs101 and earn Binance points! 🚀
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