[Acid Trades] Beginner tutorial for Binance

I was asked in recent posts about trading to do a tutorial for beginners who have no experience in trading and would like to try it out. So this post is going to be about that, I'm sure most of you oldtimers on Steem already know these things so hold on for the next post as I'm preparing to make my first buy-in and setting sell and buy orders for it while explaining why I chose that currency to begin with.

I decided to go with Binance for the tutorial because it is one of the most popular exchanges and to this day does not require KYC (know your customer) unless you want to withdraw more than 2 btc per day (maybe if this trading experiment goes right we may face such problems but that won't be the end of the world :p)

To start off, if you don't have an account on Binance, feel free to create one by using my referral link (it won't penalize you, I'll just earn a percentage of your trading fees which would else go to the exchange) after you've created it, you will be able to log in.

Once logged if you mouse over "Wallet" in the upper right and click on "Exchange Wallet (Deposit & Withdraw)" it'll take you to your balance which will look something like this:

Trading with BNB and fees involved

(if you don't care much about the trading fees and want to skip ahead - tl;dr: default trading fee on binance is 0.1% per trade but 0.075% if you hold some BNB (binance coin) which will get burned per trade depending on the value of it)

If you're going to be trading actively I'd recommend you to purchase some BNB as they use it as a way to grant you cheaper trading fees while burning parts of the token for each trade. The amount depends on the value you're trading with but it's better than trading without BNB at all as burning BNB removes 25% of the fee. The normal fee is 0.1% per trade but using BNB it drops to 0.075%.

Here now you should notice what this percentage means. Say you purchase Steem at (for simplicity's sake (let's hope it won't drop that low)) 1k satoshis. For each trade it will cost you 0.075% + some BNB but let's not think about the BNB for now let's just say it's cheaper than trading for the default fee of 0.1% but again for simplicity let's say we're trading without holding any BNB to burn.

So you purchase 1000 Steem at 1000 satoshis which would cost you 0.01 BTC, once you finish the trade you will have 999 Steem as 0.1% went to the fee. What this means is that if you want to make a profit from trading back into BTC, you will need the price to move at least 0.2% to be even as each trade costs you 0.1%. In crypto these small movements are pretty common and bots and day-traders take advantage of them often. So let's say Steem has now moved up to 1100 satoshis each, you sell 999 Steem for 1100 satoshis and after the trade you will have (999x0.0000109) 0.0108891 BTC giving you a 0.0008891 BTC profit. (I'm 90% sure the math is not 100% correct here) but that doesn't matter much as long as you know that you'll need a bigger price movement than 0.2% to turn a profit and like I said that happens quite often in the crypto space, BTC by itself can move 5-10% in one day considering it's one of the biggest by marketcap and spread out over so many exchanges all over the world so it's not impossible for altcoins to make similar moves every now and then.

The trading

Moving forward, when you've deposited some coins, let's say Steem to your Binance account by sending to account name (@deepcrypto8) and entering your unique memo ID they will be available on your Wallet page and show up on top if that's your highest value currency you are holding. You can from there easily go to Steem's trading pair by clicking on "Trade" on the right side of your balance and when the next window pops up you click on Steem/BTC or Steem/ETH or Steem/BNB depending on which currency you want to trade for. The less steps you have to take the cheaper it is for you as each trade has the default 0.1% fee. This is why people would like to have a Steem/stable coin pair which currently only exists on the Huobi Global exchange with Tether (USDT). On binance without that pair if you would want to trade Steem for a stablecoin you'd have to first sell it for BTC and then BTC for USDT which will mean 0.2% fee already and another 0.2% fee to trade back into Steem.

Anyway once you've clicked on Steem/BTC you will be sent to this page:

Alright so here's what you need to know to start trading.

#1 This is the sell order book, it shows all currently listed sell orders with the price in satoshis and the amount of Steem. To buy into these walls you will need to use step #6. In this screenshot and example let's say you want to instantly purchase 9000 Steem, to successfully do so you will have to sum up the amount of Steem in the sell orders for instance you'd have to put your buy Steem price to 1655 satoshis with the amount 9000 and it will buy up all Steem starting from 1649 up to 1655 while leaving some of the 7000 Steem at 1655 left as the other prices will have filled you 9000 Steem buy order. If you don't want to buy it all up at once you simply put in the price of say 1646 which is above the current buy order of 1926 Steem at 1645 satoshis and then you'd have to wait for someone to sell into your buy order which you can see at #2.

#2 We already kind of covered this, if you want to sell all of your Steem instantly and you have say 10,000 you will have to place a sell price of 1639, type in your 10,000 Steem amount or click the 100% for a shortcut and then press the sell button and it will automatically sell starting with the 1926 Steem at 1645 all the way down to 1639 leaving some left at that price.

#3 is the time frame of the chart, in the screenshot it is set to 1 day which means that each candle you see in the chart represents the movement of price that particular day. If you were to change it to 1 hour the candles would represent one hour of price movement and look very different:

#4 are the candles showing how high and low the price has been that day, let's not get too much into those in this tutorial.

#5 is the volume that occurred that day, how much Steem was sold and purchased and the difference between the two indicates if the volume shows a green bar (if more Steem was bought than sold) or a red bar.

#8 This is the live trade history showing timestamp, price and amount purchased or sold and in the next tab you can also see your own history.

Another thing you can look at is the depth of the books by clicking on this tab here:

This only shows the current buy orders and on which prices they are on and sell orders, be aware though that depending on what is going on with current trades or if sudden spikes occur or other form of manipulation these can quickly change as people either cancel them or have bots do it for them depending on what is going on. Don't rely on them to make a judgement on buying or selling a currency as they can be faked even easier than volume can, but about that let's talk another time.

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This concludes the tutorial. If you have any questions I'll try my best to respond here in the post, don't worry if you think it sounds newbish as we've all been there and this can be a lot to take in at first.

If you don't like exchanges or don't want to trust them with a lot of value (which you shouldn't) you should know Steem has it's own internal exchange where you can trade Steem for SBD with 0 fees similar to the Binance exchange. This is not that optimal right now though as SBD has not held it's peg and more times than preferred it moves up and down together with Steem. Hopefully the peg will be restored soon and SBD starts being printed again giving it more liquidity once the price of Steem recovers.

In the next [Acid Trades] post I will be talking about our first buy-in and investment and why I chose that currency and how I plan on trading it in the near future to make some profit of it's movements to hopefully buy back more Steem with it.

Thanks for reading and hope you learned something! :)

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