Cryptocurrency has carved a significant space for itself within the world of finance and is already a favorite of investors worldwide. But to master any craft, it is vital to be absolutely clear on the basics. The crypto market is still new, and the new terms and jargon can confuse some. One of the terms is “order book,” which plays a critical role in the operation of many cryptocurrency exchanges.
What exactly is an order book?
If you are remotely familiar with the stock or commodity exchange, an order book is a record of all the buy and sell orders that are placed for a given asset. It is essentially a ledger that tracks the demand for an asset at a given time.
The same applies to the world of cryptocurrency. The function of the order book is similar, but the operations are slightly different as the order book here works in a decentralized manner. It is not maintained by any central authority but rather by a network of computers that run the underlying blockchain technology.
How do I read an order book at LCX?
Reading an exchange order book for cryptocurrency can be a challenging task for novice and experienced traders alike. An exchange order book is a digital ledger that displays all buy and sell orders for a particular cryptocurrency on a specific exchange. This information is displayed in real time and can be used to gauge the current market sentiment and determine the potential direction of the cryptocurrency’s price.
To read an exchange order book effectively, start by identifying the columns labeled “Bids” and “Asks.” Bids represent the current buy orders on the exchange platform, while asks represent the current sell orders. Each entry in the “bid” and “ask” columns will show the price at which the order is being placed and the total number of units being offered at that price. The bid column shows the current highest bid price, while the ask column shows the current lowest ask price. The difference between the bid and ask prices is known as the spread, and it represents the potential profit that a trader could make by buying at the bid price and then selling at the ask price. An important fact to note is that bid and ask prices are constantly changing, so it is crucial to pay attention to the market and watch out for these changes.
Additionally, in the order book, you can check the price of the recently placed orders for a particular crypto asset. The order book contains a list of all recent buy and sell orders.
What are the types of trade orders available at LCX?
LCX offers two types of trades: Market orders and Limit orders. Market orders allow users to trade their coins at the current market price. It is the kind of trade that is most simple and fastest. Whereas limit orders allow users to trade their coins at a specified price, i.e., at the price you’re willing to trade.
How do I place a market order at LCX?
To place a market order at the LCX exchange, select the market mode. Then enter the amount or number of tokens or coins you want to buy or sell and hit the buy/sell option. Your trade will execute at the market price instantly and smoothly.
How do I place a limit order at LCX?
To place a limit order at the LCX exchange, select the limit order mode. Then enter the bid amount or the number of tokens/coins you want to buy/sell, and hit the buy/sell option. Your order will be placed and will only execute once a buyer or seller is ready to trade at your bid amount.
In Conclusion
Trading at LCX offers consumers a regulated, transparent, and secure experience in the cryptocurrency world. If you are new to the trading platform, start your LCX journey with our beginner’s guide.
