> For the complete documentation index, see [llms.txt](https://vexar.gitbook.io/docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://vexar.gitbook.io/docs/trading-guide.md). # Trading Guide ### Introduction This comprehensive guide covers everything you need to know about trading on VEXAR, from basic order types to advanced strategies. ### Order Types #### Market Orders **What is it?** * Executes immediately at the current market price * Guaranteed to fill * May experience slippage during volatile markets **When to use:** * When you need immediate execution * During low volatility periods * For small to medium-sized orders **Example:** ``` Market Buy Order Pair: BTCUSDT Amount: 0.1 BTC Expected Price: $42,350 (current market) Actual Fill: $42,352 (slight slippage) ``` #### Limit Orders **What is it?** * Order executes only at your specified price or better * Not guaranteed to fill * No slippage - you get your price or nothing **When to use:** * When you have a specific target price * To avoid slippage on large orders * When you're not in a hurry **Types:** * **Post-Only**: Order will only be added as a maker order * **Good Till Cancelled (GTC)**: Order remains active until filled or cancelled * **Immediate or Cancel (IOC)**: Execute immediately, cancel any unfilled portion * **Fill or Kill (FOK)**: Execute entire order immediately or cancel **Example:** ``` Limit Buy Order Pair: ETHUSDT Amount: 5 ETH Limit Price: $2,200 Status: Pending (will only fill at $2,200 or lower) ``` #### Stop Orders **Stop-Loss Order:** * Triggers a market order when price reaches your stop price * Used to limit losses on existing positions * Essential risk management tool **Stop-Limit Order:** * Triggers a limit order when stop price is reached * More control but may not fill in fast markets **Example:** ``` Long Position Entry: $40,000 Stop-Loss: $39,000 (-2.5% loss) Take-Profit: $42,000 (+5% profit) ``` #### Trailing Stop **What is it?** * Stop price moves with the market in your favor * Locks in profits while limiting losses * Can be set as percentage or fixed amount **Example:** ``` Position: Long BTC at $40,000 Trailing Stop: 5% below highest price - Price goes to $45,000 → Stop moves to $42,750 - Price drops to $42,750 → Position closes with profit ``` ### Reading the Trading Interface #### Order Book The order book shows all pending buy and sell orders: **Green (Bids):** * Buy orders * Shows price, amount, and total * Highest bid at the top **Red (Asks):** * Sell orders * Shows price, amount, and total * Lowest ask at the top **How to Read:** ``` Bids (Buy) Price Asks (Sell) 0.5 BTC $42,350 0.3 BTC 0.8 BTC $42,349 0.6 BTC 1.2 BTC $42,348 0.9 BTC ``` **Market Depth:** * Visual representation of liquidity * Large walls indicate strong support/resistance * Thin books = higher slippage potential #### Recent Trades Shows the latest executed trades: * **Price**: Execution price * **Amount**: Trade size * **Time**: When the trade occurred * **Color**: Green (buy), Red (sell) #### Position Panel **For Perpetual Contracts:** * Entry Price * Mark Price (used for PnL calculation) * Unrealized PnL * Liquidation Price * Funding Rate ### Risk Management #### Position Sizing **Rule of Thumb:** * Never risk more than 1-2% of your capital per trade * Calculate position size based on stop-loss distance **Formula:** ``` Position Size = (Account Balance × Risk %) / Stop Distance % Example: Account: $10,000 Risk: 2% ($200) Stop Distance: 5% Position Size: $200 / 0.05 = $4,000 ``` #### Leverage Management **Leverage Levels:** * **1-3x**: Conservative, suitable for beginners * **3-5x**: Moderate, for experienced traders * **5-10x**: Aggressive, requires active management * **10-20x**: Very high risk, expert traders only **Liquidation Risk:** ``` Leverage | Allowed Price Movement Against You 5x | -20% 10x | -10% 20x | -5% ``` #### Stop-Loss Strategies **1. Fixed Percentage Stop** * Simple and consistent * Example: Always 2% from entry **2. Technical Level Stop** * Below support for longs * Above resistance for shorts * Based on chart patterns **3. ATR-Based Stop** * Uses Average True Range indicator * Adapts to volatility * Formula: Entry Price ± (2 × ATR) **4. Time-Based Stop** * Close position after X hours if target not reached * Prevents capital being tied up ### Trading Strategies #### Scalping **Characteristics:** * Very short timeframes (1-5 minutes) * Many small trades per day * Target: 0.1-0.5% per trade * Requires fast execution and low fees **VEXAR Advantages:** * Millisecond latency * Low maker fees (0.02-0.10%) * Advanced order types #### Day Trading **Characteristics:** * Open and close positions within same day * 5-minute to 1-hour charts * Target: 1-3% per trade * No overnight risk **Key Factors:** * Volume analysis * Support and resistance levels * Moving averages * RSI and other oscillators #### Swing Trading **Characteristics:** * Hold positions for days to weeks * Daily charts * Target: 5-15% per trade * Less time-intensive **Strategy:** * Identify trends early * Enter on pullbacks * Use wider stops * Let winners run #### Position Trading **Characteristics:** * Hold positions for weeks to months * Weekly/monthly charts * Target: 20%+ per trade * Based on fundamental analysis ### Technical Analysis Basics #### Essential Indicators **1. Moving Averages** * Simple MA (SMA) * Exponential MA (EMA) * Common periods: 20, 50, 100, 200 **2. RSI (Relative Strength Index)** * Measures momentum * Overbought: > 70 * Oversold: < 30 **3. MACD (Moving Average Convergence Divergence)** * Trend and momentum indicator * Bullish: MACD crosses above signal * Bearish: MACD crosses below signal **4. Volume** * Confirms price movements * High volume = strong moves * Low volume = weak moves #### Chart Patterns **Reversal Patterns:** * Head and Shoulders * Double Top/Bottom * Triple Top/Bottom **Continuation Patterns:** * Flags and Pennants * Triangles (Ascending, Descending, Symmetrical) * Rectangles #### Support and Resistance **Identifying Levels:** * Historical price reactions * Round numbers (psychological levels) * Previous highs and lows * Fibonacci retracements **Trading Strategy:** * Buy near support * Sell near resistance * Wait for breakouts with confirmation ### Advanced Concepts #### Funding Rates (Perpetuals) **What is it?** * Mechanism to keep perpetual prices close to spot * Paid every 8 hours between traders * Positive rate: Longs pay shorts * Negative rate: Shorts pay longs **Trading Strategy:** * Check funding before opening positions * Consider funding costs for long-term holds * Arbitrage opportunities when rates are extreme #### Liquidation Price **How it's calculated:** ``` Long Position: Liquidation Price = Entry Price × (1 - 1/Leverage) Short Position: Liquidation Price = Entry Price × (1 + 1/Leverage) ``` **Example:** ``` Long BTC at $40,000 with 10x leverage Liquidation: $40,000 × (1 - 1/10) = $36,000 ``` #### Mark Price vs Last Price **Last Price:** * Most recent trade price * Can be manipulated * Used for order execution **Mark Price:** * Based on spot index + funding * Used for liquidation and PnL * More stable and fair ### Trading Psychology #### Emotional Control **Common Emotions:** * **Fear**: Missing out, losing money * **Greed**: Overleveraging, not taking profits * **Hope**: Holding losing positions too long * **Revenge**: Trading to recover losses **How to Manage:** * Follow your trading plan * Use position sizing rules * Take regular breaks * Keep a trading journal #### Trading Journal **What to Record:** * Entry and exit prices * Position size and leverage * Reasoning for the trade * Emotions felt during trade * Outcome and lessons learned ### Performance Metrics #### Key Statistics **Win Rate:** ``` Win Rate = (Winning Trades / Total Trades) × 100% ``` **Average Win/Loss Ratio:** ``` Profit Factor = Total Profits / Total Losses ``` **Sharpe Ratio:** * Measures risk-adjusted returns * Higher is better * Above 1.0 is good, above 2.0 is excellent **Maximum Drawdown:** * Largest peak-to-trough decline * Indicates worst-case scenario * Should be manageable with your risk tolerance ### Tips for Success ✅ **Do:** * Have a trading plan and stick to it * Use stop-losses on every trade * Calculate position sizes properly * Keep emotions in check * Learn from your mistakes * Stay updated on market news ❌ **Don't:** * Overtrade or revenge trade * Use leverage you can't handle * Follow random tips on social media * Risk money you can't afford to lose * Trade during high emotional states * Ignore risk management rules ### Resources * Perpetual Trading Deep Dive → * Spot Trading Guide → * API for Automated Trading → * Security Best Practices → *** *Next: Perpetual Trading →* --- # Agent Instructions This documentation is published with GitBook. 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