Understanding Crypto: Crypto Affairs of Pakistan Sycap

CRYPTO AFFAIRS OF PAKISTAN SYCAP By: Umar Khalid
CRYPTO AFFAIRS OF PAKISTAN SYCAP

UNDERSTANDING CRYPTO
By: Umar Khalid
INTRODUCTION
Sr. Explaination
A Cryptocurrency
1 It is an Electronic (Digital) Money created with Technology controlling its Creation and Protecting Transactions,
2 The transactions in Cryptocurrency are processed on the Blockchain; a shared database (decentralized), that is
3 Each transaction happens directly between users — it’s called a Peer-to-Peer Network.
B How it Works
When someone sends Bitcoin, the transaction is verified and then stored on the blockchain (the shared database).
C Proof of Work (POW)

When a new block of transactions is sent to the blockchain, the miners/nodes will verify the block using an
D Proof of Stake (POS)

Stakers are people that verify transactions for rewards, just like miners. But instead of racing to verify a block
E Diff Technology Coins (Than BTC)

a. ETH & NEO were not designed to be used as a digital currency. Instead, they were designed as huge platforms
b. They introduce New Technology; Smart Contract that can automatically execute transactions when certain
c. No 3rd Party Needed in this.
F Token (for Decentalized Apps - dApps)

a. You can Tokenize real things and put them on the blockchain e.g. Electricity, House etc.
b. They can be used to purchase things on the dApp to get some advantages e.g. discounted/voting fees.
c. They do not have their own blockchain instead they use other coins Block Chain e.g. BTC, ETH
d. A Token transaction is still verified by the nodes on the ETH or NEO blockchain & its fee is still paid with ETH or
G HARD FORK VS SOFT FORK

Fork a. Any software needs update to fix issues or increase performance. In Crypto world,
these updates are called Forks.
b. b. Since Cryptocurrencies are decentralized network, all the Participants (called
Nodes) needs to follow the same Rule (called Protocols e.g. Size of Block on a
Blockchain, Miners Reward etc.) in order to work properly.
c. There are 2 kinds of forks; Hard & Soft fork; that fundamentally change the
Protocols of Cryptocurrency.
Soft Fork It is backward-compatible that means Non-Updated nodes are still able to process
the transaction and puch new block to the blockchain as long as they don't break
the New Protocol Rules .
Ex: Soft Fork make a new rule of lowering the block size from 3MB to 2MB; older
Nodes still be able to process the transaction with 2MB or less; the greater than
2MB will be rejected
Hard Fork It is backward-incompatible that means Non-Updated nodes are unable to process
the transaction and puch new block to the blockchain.
It is used to change or improve the existing protocol or even create a new
Indipendent Protocol and blockchain.
Ex: Hard Fork make a new rule of block size from 2MB to 4MB; the older Nodes
unable to process the transaction.
Planned Hard Fork In planned hard fork, the participants voluntarily upgrade their software to follow the
new rule leaving teh old chain behind.
Controversal Hard Fork a. Means there is disagreement within the community about the upgrade; the
protocol usually forked into 2 Incompatible blockchains, 2 diff Cryptocurrencies.
b. Both blockchains have their own community, and the Developers will progress in
the way they believe is the best.
c. Since a fork is based on the original blockchain, all the transactions from the
original blockchain are also copied into the new fork.
Ex: If you have 100 Cryptocurrency Coins called Coin-A, and a hard fork based on
that, Cryptocurrency creates a new Cryptocurrency called Coin-B, you will also get
100 Coins of Coin-B.
https://academy.binance.com/en/articles/hard-forks-and-soft-forks
H LAST THING
a. Speed: Diff blockchain has dif speed e.g. ETH can process transactions in a matter of seconds, whereas BTC's
b. Control: Not all Cryptocurrencies & Blockchain are Decentralized e.g. Ripple is a Centralized blockchain used
c. Fee: Diff blockchain charge diff fee. Like BTC is very Costly & Litecoin transactions are much cheaper
https://www.facebook.com/groups/cryptoaffairsbyshoaybkhan/ 1 of 17
Difference Between Coin & Token

1 Coins have their own Blockchain (e.g. BTC, XRP, Tron, Ethereum, Neo, LTC coins).
2 Token are designed on the other coins blockchain (e.g. Eth, Tron and Neo coins blockchain).
ERC20 Tokens means they designed on Etherium Blockchain & TRC20 means The Tron Blockchain .
Coins have Individual Identity with having their own Blockchain while tokens designed on Biggest Giant Coins
COIN TYPES
Sr Types of Coin Explaination
1 Payment Method e.g. BTC, ETH
2 Infrastructure Coin e.g. ETH, NEO
3 Security Token e.g. CapexMove
4 Utility Token e.g. Golem
5 Privacy Coin Coins which hides the identity of the user, wallet balance or transfers. e.g. Monero,
Dash, Zcash
Which & How to to
Choose Coin for Trade?
1 Recommended to Trade in Top 10 Coins (excl. Stable Coins).
2 Check the Project (read its white paper), Proj. should be good.
3 Check the Technical Analysis at https://www.coingecko.com/en/ - it gives signal to Buy or Sell.
BTC DOMINANCE
Sr Situation Explaination
1 Alts ↑ & BTC ↓ People Selling BTC & Investing in Alternative Coins.
2 Alts ↓ & BTC ↑ People Selling Alts & Investing in BTC.
3 Alts ↑ & BTC ↑ People Investing Money in the Market (Addition Funds Added in the Market).
4 Alts ↓ & BTC ↓ People taking out Money from the Market.
For Beginners: Compare BTC Dominance with AltCoin & Take Trade.
IMPORTANT TERMINOLOGIES
Sr Term Explaination
1 Alts All coins/tokens except BTC.
2 ATH All Time High, it can be in different time frames such as 24 hours to 1 year/more.
3 ATL All Time Low. Can be in different time frames.

4 BTC The king of crypto. First block created on 9 January 2009
5 Bullish Up trend market
6 Bearish Down trend market
7 Buy / Long A futures trade where you predict price will go up.
It means buying an asset with the expectation that its value will rise.
8 Sell / Short A futures trade where you predict price will go down.
It means selling an asset with the intention of rebuying it later at a lower price.
9 DeFi Decentralized Finance
10 CeFi Centralized Finance
11 DEX Decentralized Exchanges like Uniswap, etc.
12 Entry The price you enter any trade, usually the buying price
13 Exit The price you exit a trade with profit (or loss).
14 FOMO Fear Of Missing Out
15 FUD Creating “Fear, Uncertainty & Doubt”.
16 HODL Hold On to Dear Life, meaning do not sell in loss.
17 Hype Promoting a coin extensively / sometimes unrealistically.
18 ICO Initial Coin Offering
19 IEO Initial Exchange Offering
20 Masternode A full node, which validates transactions within blockchain ecosystem and gets
rewards. Can be considered virtual mining. Only gives rewards of the same crypto
you have Masternode of.
21 Mining Generating processing power to validate/authorize blocks, which allow transactions
to approve.
22 PIP Point In Percentage. This is represented by a single digit move in the fourth decimal
place
23 Pump & Dump Up & down e.g. shit coins.
24 Shilling Make a hype of coin in the market. Doing secretive marketing, which may seem it is
genuine but actually the person is getting paid to promote a project/coin.
25 Shit Coin Bad project, no aims/pointless aims and no team.
26 TA Technical Analysis
27 FA Fundamental Analysis
28 VPS Virtual Private Server used to deploy and integrate a Masternode.
29 Whales Huge investors. E.g 1000 bitcoin owners
30 KYC Know Your Customer. mandatory process of identifying and verifying the identity of
the client when opening an account and periodically over time.
31 Increasing Trend Bullish, Extension, Appreciation, Increase, Bullish, Long, Buying Trend, Breakout
32 Decreasing Trend Bearish, Correction, Depreciation, Retracement, Short, Selling Trend, Breakdown
33 Volataility E.g. Price Volataility measure of how much prices move up and down over a given
period.
34 Liaquidity a. To convert assets into cash or cash equivalents by selling them on the open
market.
b. It is also used in Bankruptcy Procedures in which an entity chooses or is forced
by a legal judgment or contract to turn assets into a liquid form (cash)
35 Maker You become a Maker when you place an order that doesn’t immediately get filled
but gets added to the Order Book.
36 Taker You become a Taker when you place an order that gets immediately filled & doesn't
added to the Order Book.
37 Bid-Ask Spread The diff. b/w the Highest Buy Order (bid) & the Lowest Sell Order (ask) for a given
market.
TRADING BASICS
Sr Explaination
A Rules of Trading
1 Never Invest at Single Point / Price
2 Never use a Single Indicator for Any Trade. Use Atleast 3 Indicators.
3 Initially do a Paper Trading; take 10 Trade for Practice. Invest: if your Sucess Rate is 70% with Small Fund.
Crypto is a Game of Patience .
B Fundamental Analysis
It is assessing a financial asset’s valuation. A fundamental analyst studies both Economic & Financial Factors to
C Technical Analysis
The core idea behind TA is that historical Price Action may indicate how the market is likely to behave in the future.
https://academy.binance.com/en/articles/a-complete-guide-to-cryptocurrency-trading-for-beginners
D Market Trend
It is the overall direction where the price of an asset is going. In TA, market trends are typically identified using
TYPES OF TRADING / TRADERS

Sr. Trading Explaintation
1 Scalpers Scalpers are the individuals who makes dozens or hundreds of trades per day in an
attempt to scalpe small amount of profit from each trade by exploiting the bid-ask
spread.
2 Momentum Traders Momentum Traders seeks the stocks that are Moving Significantly in One
Direction in high volume. These traders are attempt to ride the momentum to
desire profit.
3 Technical Trading Technical Trading focus on Charts & Graphs. They analyze line on stokc or index
graphs for signs of convergence or divergence that might indicate buy or sell signals.
4 Fundamental Trading Fundamentalists trade companies based on fundamental analysis, which examines
corporate events, particularly actual or anticipated earnings reports, stock spilits,
reorganizations, or acquisitions.
5 Swing Trading Swing Traders are Fundamental Traders who hold their position longer than a single
day. Most fundamentalist are really swing trading since changes in corporate
fundamentals typically required several days or even week to produce a price
movement sufficient for the trader to claim a reasonable profit.
CANDLESTICK PATTERNS
Sr. Candlestick Appearance | Interpretation
1 Doji No Body, Long Wicks. Confusion b/w B&S | Trend Reversal
It doesn't work in Sideway Market. Always look for Doji in Trending Market.
2 Spinning Top Short Centeral Body, Long Wicks. Indecision | Trend Reversal
3 Marubuzu Long Body & almost No Wicks. Dominance | Reversal or Continuation
of Trend
4 Hammer Short Upper Body, Long Lower Wicks | Bullish Reversal
Found in Down Trend . It doen't matter whether it is Bullish or Bearish , the
interpretation is same.
5 Hanging Man Short Upper Body, Long Lower Wicks. | Bearish Reversal
Found in Up Trend . It doen't matter whether it is Bullish or Bearish , the
Hammer (↑) Hanging Man (↓) are same but found at different Trend & have
different Interpretation.
6 Inverted Hammer Short Lower Body, Long Upper Wicks. | Bullish Reversal
Found: Bottom of Down Trend . It doen't matter whether it is Bullish or Bearish ,
the interpretation is same.
7 Shooting Star Short Lower Body, Long Upper Wicks. | Bearish Reversal
Found in Up Trend . It doen't matter whether it is Bullish or Bearish , the
Inverted Hammer (↓) & Shooting Star (↑) are same but found at different Trend &
have different Interpretation.
8 Bullish Engulfing Bullish completely Engulfs (Cover) Bearish Candle | Bullish Reversal
Found in Down Trend . 1st Bearish candle cover by 2nd Bullish candle.
9 Bearish Engulfing Red Candle Covered by Green Candle | Bearish Reversal
Found in Up Trend . 1st Bullish candle cover by 2nd Bearish candle.
10 Bullish Harami Red Candle Body Covered by Green Candle | Bullish Reversal
Found in Down Trend . 1st Bearish candle covered 2nd Bullish candle.
11 Bearish Harami Bullish Engulfs (Cover) Bearish Candle | Bearish Reversal
Found in Up Trend . 1st Bullish candle covered 2nd Bearish candle.
12 Morning Star 1. Bearish - 2. Bullish/Bearish - 3. Bullish. | Bullish Reversal
Found in Down Trend . Use bigher time frame (e.g. 1 day or 4 hr chart)
13 Evening Star 1. Bullish - 2. Bullish/Bearish - 3. Bearish. | Bearish Reversal
Found in Up Trend . Use bigher time frame (e.g. 1 day or 4 hr chart)
Three White Soldiers 1. Bullish - 2. Bullish & bigger than 1st one - | Powerful Bullish Reversal
3. Bullish with no or samll upper shadow
Found in Down Trend.
Three Black Crow 1. Bearish - 2. Bearish & bigger than 1st one - | Powerful Bearish Reversal
3. Bearish with no or samll upper shadow
Found in Up Trend.
https://mm5007.sbm-itb.net/2019/02/14/what-are-the-candlesticks-charts/
CANDLESTICK PATTERN SUMMARY

Sr Trend Candlestick Pattern
1 ONE CANDLE PATTERN
a. Bullish Hammer, Inverted Hammer, Dragonfly Doji, Bullish Spinning Top
b. Bearish Hanging Man, Shooting Star, Gravestone Doji, Bearish Spinning Top
2 TWO CANDLE PATTERN

a. Bullish Bullish Kicker, Bullish Enguilfing, Bullish Harami, Piercing Line, Twizeer Bottom
b. Bearish Bearish Kicker, Bearish Enguilfing, Bearish Harami, Dark Cloud, Twizeer Top
3 THREE CANDLE PATTERN

a. Bullish Morning Star, Morning Doji Star, Bullish Abandoned Baby, Three White Soldiers,
Three Line Strike, Three Inside Up, Three Outside Up
b. Bearish Evening Star, Evening Doji Star, Bearish Abandoned Baby, Three Black Crows,
Thre Line Strike, Three Inside Down, Three Outside Down
https://academy.binance.com/en/articles/beginners-candlestick-patterns
PRICE INDICATION - TREND LINES

Sr Explaination
1 It is simply a Straight Lines that shows the Market Trend (i.e. Upward / Downward).
2 It also shows the Support & Resistance.
3 To be Valid Trend Line, we need At Least 2 Tabs of Price on Trend Line.
4 It also shows the Trend Reversal (Breaking Out or Breaking Down).
5 It gives Buying/Selling Indication (e.g. Support: Buy & Resistance: Sell).
6 Price Channels can be made with Trend Lines that help in Buying/Selling.
CHART PATTERNS
Sr Chart Explaination
1 Symmetrical Triangle a. Need at least 2x Low of the Resistance level to the Downside &
at least 2x Highs of the Support level to the Upside
b. Found in Up Trend or Down Trend
c. Can be Bullish / Bearish Pattern
d. Interpretation: Wait for Breakout (Bullish) or Breakdown (Bearish)
e. Target: Price Measure the hight of Triangle to analyse Take Profit Position.
2 Ascending Triangle a. Need at least 2x Resistance Line in Horizental sequence (straight)
c. Bullish Pattern
d. Interpretation: Wait for Breakout (Bullish)
e. Target: Price Measure the hight of Triangle to analyse Take Profit Position.
3 Descending Triangle a. Need at least 2x Lows of Resistance Level toward Downside
b. Need at least 2x Support Levels in Horizental sequence (straight)
c. Bearish Pattern
d. Interpretation: Wait for Breakdown (Bearish)
f. Target: Price Measure the hight of Triangle to analyse Take Profit Position.
4 Head & Shoulder a. Consist of Left Shoulder, Head, Right Shoulder
b. Neckline is formed connecting shoulders
c. Found in Up Trends
d. Bearish Reversal Pattern
e. Interpretation: Upon breaking the Neckline, the Price will Free Fall
f. Always use bigger time frame for this (4 hr or Daily Chart)
g. Target: Price Measure from Head to Neckline
5 Inverse Head & Shoulder a. Consist of Left Shoulder, Head, Right Shoulder
b. Neckline is formed connecting shoulders
c. Found in Down Trends
d. Bullish Reversal Pattern
e. Interpretation: Upon breaking the Neckline, the Price will Rally Upside
f. Always use bigger time frame for this (4 hr or Daily Chart)
g. Target: Price Measure from Head to Neckline
6 Double Bottom a. Consist of 2x Bottoms (like W). Price makes a low then slightly pushes upside &
then makes another low of almost the same length.
b. Found in Down Trend
c. Bullish Reversal Pattern
d. Interpretation: Upon breaking the Neckline, the Price will Rally Upside
e. Target: Price Measure from Bottom to Neckline
7 Double Top a. Consist of 2x Tps (like M). Price makes a high then slightly pushes downside &
then makes another high of almost the same length.
b. Found in Up Trend
c. Bearish Reversal Pattern
d. Interpretation: Upon breaking the Neckline, the Price will Free Fall
e. Target: Price Measure from Top to Neckline
8 Bull Flag a. Continution Pattern make a Flag in Up Trend
c. Bullish Pattern
d. Interpretation: Continution of Up Trend. Wait for Breakout to Take Entry
e. Target: Price Measure the Upside Pole of Flag
9 Bear Flag a. Continution Pattern make a Flag in Down Trend
b. Found in Down Trend
c. Bearish Pattern
d. Interpretation: Continution of DownTrend. Wait for Breakout to Take Entry
e. Target: Price Measure the Downside Pole of Flag
10 Cup & Handle a. Rounded Bottom & followed by Handle like Cup
d. Interpretation: Wait for the break out & then Take Entry
e. Target: Price Measure Length of Cup to the Neckline
11 Falling Wedge a. It is Widest at Top & become Narrow as it moves Downward/Descending way
d. Interpretation: Wait for the break out & then Take Entry
e. Target: Resistance Levels ( L1 & L2 etc.)
12 Rising Wedge a. It is Widest at Bottom & become Narrow as it moves Upward/Aescending way
c. Bearish Reversal Pattern
d. Interpretation: Wait for the break down& then Sell
e. Target: Support Levels ( L1 & L2 etc.)
https://forextraininggroup.com/trading-cup-handle-pattern-best-results/
TECHNICAL INDICATORS/OSCILLATORS
Sr Indicator Explaination
i. TREND INDICATORS
Trend-following indicators smooth out the price and follow the trend line of the chart. They are based on the past
1 Tripple Moving Average It averages last specific no of closing price & show a Trend Line
(aka Simple MA) SMA give Equal Value to All Data & EMA gives More Value to Recent Data
Settting: 10 Yellow, 25 Green, 99 Red
Bullish: 10, 25, 99 (YGR) & Bearish: 99, 25, 10 (RGY)
2 Exponential Moving Avg a. EMA gives higher weights to recent prices & SMA assigns equal weights to
all values.
(aka Exponentially b. EMAs place a higher weighting on recent data than on older data, they are more
Weighted MA) responsive to the latest price changes than SMAs. That makes the results from
EMAs more timely.
Setting: 8 Yellow, 32 Blue, 55 Green, 100 Red
Bullish: 8, 32, 55, 99 (YBGR) & Bearish: 100, 55, 32, 8 (RGBY)
3 4 EMA Indicator a. Shows the Market Trend (Bullish / Bearish)

by Philakone b. It gives Entry & Sell Signal
c. It act as Support & Resistance
d. Setting: Blue 8, Green 12, Yellow 21, Red 55
e. Buy: If in Sequence (8, 12, 21, 55 - BGYR). Trend will be Upwards
f. Sell: Reverse Sequence (55, 21, 12, 8 - RYGB). Trend will be Downwards
4 Parabolic SAR a. It appear in the form of Dots & works best in Trending Market
by everget b. It is secondary confirmation, so us it bigger time frame (15, 30 min or 1 hr)
c. Preferable to use it with Triple MA
Buy: When Dots are Below the Candlestick
Sell: When Dots are Above the Candlestick
ii. MOMENTUM INDICATORS (OSCILLATORS)

These indicators aim at determining the overbought and oversold levels and they are effective for finding price
1 RSI Relative Strength Indicator is a Momentum Indicator

Setting: Length: 14, Above: 80%, Below: 20%
Above 70%: Over Bought, Selling Region. Sell at 80% recommended
Below 30%: Over Sold, Buying Region. Buy at 20% recommended
In b/w 70-30%: Market is Side Ways, Not recommended to enter in trade.
Signal: It gives Early Entry & Exit Signal
2 RSI Divergence a. Bullish Divergence: Price: Lower Low, Indicator: Higher Low
b. Bullish Hidden Divergence: Price: Higher Low, Indicator: Lower Low
c. Bearish Divergence: Price: Higher High, Indicator: Lower High
b. Bullish Hidden Divergence: Price: Lower High, Indicator: Higher High
* For best result, use 2-3 more confluence (e.g. Support & Resistance,
Candlesticks, Chart Pattern etc.)
* Check bigger time frame (e.g 1 hr or 4 hr) for confirmations
3 Stochastic (RSI) a. Above 80%: Over Bought, Selling Region. Sell at 80% recommended
b. Below 20%: Over Sold, Buying Region. Buy at 20% recommended
d. Buy Signal: In Buying Region, when Stochastic Line cross over Signal Line
e. Sell Signal: In Selling Region, when Signal Line cross over Stochastic Line
f. SL (Blue) shows last 14 Period results (14 Day, 14 Hr etc.) like RSI
g. 3 Day SMA Line alongwith Stochastic Line give more accurate result
https://www.youtube.com/watch?v=7Dliw0yjZLk&list=PLIAO2T5dSfa3CUH0a42nugd
qLi_jVXjLT&ab_channel=BinanceAcademy
4 MACD a. MACD line is calculated by subtracting the 26 EMA from the 12 EMA
(Moving Average b. A 9 EMA of MACD is called the Signal Line
Convergence Divergence) c. It Shows Strength, Direction, Momentum, Duration
Signal: It gives Entry & Exit Signal (Buy & Sell Point)
Buy Signal: When MACD Line cross over Signal Line
Sell Signal: When Signal Line cross over MACD Line
Histogram: The Hight & Color Darkness (Green/Red) shows Increasing Activity
(Buying/Selling) & vise versa
https://www.youtube.com/watch?v=RU8gIjWDPbg&list=PLIAO2T5dSfa3CUH0a42nu
gdqLi_jVXjLT&index=3&ab_channel=BinanceAcademy
5 Custom MACD Its rules are similar to MACD but gives better understanding
by ChrisMoody Setting: Fast Length: 10, Slow Lenght: 26, Signal Length: 9
5 Squeeze Momentum Ind. a. It is simplified indicator shows the Momentum as well as Enty & Exit point
by LazyBear b. Use 3 or 5 min chart as it reduce the Noise
c. You need to check Color & Hight for Entry & Exit
iii. VOLUME INDICATORS

This class of indicators shows the volume of the traded asset. Tracking the volume is useful in order to see how
1 Volume a. It show the Volume of Trade In or Out in Histogram

b. High volume indicates Upward or Downward Trend
iv. VOLATALITY INDICATOR

These indicators show how much the price of the asset is changing in a set period. The price has to be volatile in
1 Bollinger Bands a. It shows 3 Lines; SMA (length: 20 - Center) & 2x Standard Deviation lines
(SD: 2 i.e. Positive & Negative - Bands) away from SMA line
b. It measure the volataility & to identify Extreme Short Term Prices
c. Expension: When Prices are more Volatile - High Volatile
d. Contraction: When Price are in Tight Trading Range - Low Volatile
e. Cycle: Expension follows Contraction & Contraction follows Expension
Setting: Length: 21, SD: 2
Buy: When Price moves Lower Band, Over Sold
Sell: When Price moves Upper Band, Over Bought
2 Relative Volatality Index a. It show Price Valatality similar to RSI

b. High Volatile Coin easily wipe the your investment in Future Trading
c. You can check Naturan or Balooned up Valatality
d. Before jump into new coin, we need to check Sharp Edges (More or Less)
3 ATR Average True Range considered to be one of the best Indicator

by guikroth or Its success rate world wide is clsoe to 65%
by ceyhun ATR Smooth: Period: 20, Multiplier: 6.3, Smooth: 100
Best to use with Custom MACD
GOLDEN RULE FOR COMBINING

https://blog.iqoption.com/en/top-3-indicator-combinations/
There is one ground rule: Do Not overdo It. Having multiple indicators applied on the chart does not improve your
Note: There is no indicator or combination of indicators that will show 100% accurate signals all the time.
Some Combination
1 RSI + Bollinger Bands
2 SMA + Stochastic
3 ATR + Parabolic SAR
FUTURE & MARGIN https://academy.binance.com/en/articles/what-are-perpetual-futures-contracts

Sr Topic Explaination
1 Futures Contract a. It is an agreement to buy or sell a commodity, currency, or another instrument at
a Predetermined Price at a Specified Time in the Future.
b. Unlike Spot Market, in a Futures Market, the trades are not ‘Settled’ instantly but
at some Future Date.
2 Perpetual Futures Contract a. It is a special Future Contract as it doesn’t have an Expiry Date so one can hold
a position for as long as they like.
b. The price of Asset is Index Price (i.e. Avg Price according to major Spot Market &
Trading Vol).
3 Initial Margin / Collateral The minimum value you must pay to open a leveraged position.
Ex: you can buy 1000 BNB with an initial margin of 100 BNB (at 10x leverage). So
your initial margin would be 10% of the total order. The initial margin is what backs
your leveraged position, acting as collateral.
4 Maintenance Margin a. The minimum amount of collateral you must hold to keep trading positions open.
b. If your margin balance drops below this level, you will either receive a margin call
(asking you to add more funds to your account) or be liquidated.
c. The maintenance margin is a dynamic value that changes according to market
price and to your account balance (collateral).
5 Margin Level a. The formulato calculate the Margin Level:

Margin Level = Total Asset Value / (Total Borrowed + Total Accrued Interest)
b. The risk level changes according to the market movements, so if the prices move
against your prediction, your assets can be liquidated.
c. Note that in case you are liquidated, you will be charged extra fees.
6 Liquidation a. If the value of your Collateral falls below the Maintenance Margin, your Futures
account may be subject to liquidation.
b. The mechanism differs depending on the market and exchange, but Binance
charges a 0.5% nominal fee for Tier 1 liquidations (net exposure below 500,000
USDT). If the account has any extra funds after the liquidation, the remainder is
returned to the user. If it has less, the user is declared bankrupt.
c. When you are liquidated, you will pay additional fees. To avoid that, you can
either close your positions before the liquidation price is reached or add more funds
to your collateral balance - causing the liquidation price to move further away from
the current market price.
7 Funding Rate a. Funding consists of regular payments between Buyers & Sellers, according to
the current Funding Rate.
b. When the Funding Rate is above Zero (Positive), Traders that are l ong
(contract buyers) have to pay the ones that are Short (contract sellers).
In contrast, a Negative Funding Rate means that short positions pay longs .
c. The funding rate is based on 2x Components:1) Interest Rate and 2) Premium.
d. Binance Futures Market: Interest Rate 0.03% (fixed) & Premium Varies
according to the price difference between futures and spot markets. Binance takes
no fees for funding rate transfers as they happen directly between users.
e. So when a Perpetual Futures contract is Trading on a Premium (higher than

the spot markets), long positions have to pay shorts due to a positive funding rate.
Such a situation is expected to drive the price down, as longs close their positions
and new shorts are opened.
8 Mark Price The mark price is an Estimate of the True Value of a Contract (Fair Price) when
compared to its actual trading price (last price).
9 PnL a. PnL stands for profit and loss, and it can be either realized or unrealized.
b. When you have open positions on a perpetual futures market, your PnL is
unrealized, meaning it’s still changing in response to market moves.
c. When you close your positions, the unrealized PnL becomes realized PnL (either
partially or entirely).
10 Insurance Fund The Insurance Fund is what prevents the balance of losing traders to drop below
zero, while also ensuring that winning traders get their profits.
11 Auto-deleveraging a. Auto-deleveraging refers to a method of counterparty liquidation that only takes
place if the Insurance Fund stops functioning (during specific situations).
b. In other terms, counterparty liquidation is the final step taken when the Insurance
Fund cannot cover all bankrupt positions.
c. Typically, the positions with the highest profit (and leverage) are the ones that
contribute more. Binance makes use of an indicator that tells users where they are
in the auto deleveraging queue.
12 Margin Trading a. It is a method of trading using Borrowed Funds from a 3rd Party.
b. It allow Traders to access greater sums of capital, allowing them to leverage their
positions.
13 Leverage a. The amount that you amplify your Margin with.
b. It describes the Ratio of Borrowed Funds to the Margin.
Ex: To open a $1,000 trade at a leverage of 10:1 or 10x Leverage, a trader
would need to commit $100 of their capital.
c. The Higher Leverage you use, the Closer the Liquidation Price is to your Entry. If
you get liquidated, you’ll risk losing your entire margin.
d. Never use Leverage (Future Trading) Without Stop-Loss.
14 Isolated Margin a. The Isolated Margin is for an Indivisual Open Position.
b. If a position in Isolated Margin mode is close to being liquidated, liquidation can
be prevented by allocating additional Margin to the Position.
c. The Risk of loss is only limited to that specific position; not the Entire Margin Bal.
15 Cross Margin a. The Entire Margin Balance is shared across Open Positions to avoid liquidation.
b. If Cross Margin is enabled, the trader risks losing their entire margin balance
along with any open positions in the event of a liquidation.
STAKING https://academy.binance.com/en/articles/what-is-staking
Sr Topic Explaination
1 Staking a. It is the act of Locking Cryptocurrencies to receive rewards.
b. The main idea is that participants can lock coins (their “stake”), and at particular
intervals, the protocol randomly assigns the right to one of them to validate the next
block (i.e. the more coins locked up, the higher the chances).
2 Delegated Proof of Stake a. DPoS allows users to commit their coin balances as votes, where voting power is
(DPoS) proportional to the number of coins held.
b. These votes are then used to elect a number of delegates who manage the
blockchain on behalf of their voters, ensuring security and consensus.
c. Typically, the staking rewards are distributed to these elected delegates, who then
distribute part of the rewards to their electors proportionally to their individual
contributions.
3 Staking Pool a. It is a group of coin holders merging their resources to increase their chances of
validating blocks and receiving rewards.
b. They combine their staking power and share the rewards proportionally to their
contributions to the pool.
4 Locked Staking a. It is the process of holding funds in a cryptocurrency wallet to support the
operations of a blockchain network.
b. You can obtain interests by holding cryptocurrency which supporting by Locked
Staking.
c. During the locked period, withdrawing and trading are not supported.
d. It‘s suitable for users who need to hold coins for a long time and higher returns.
5 Flexible Staking a. You can obtain interests by holding cryptocurrency which supporting by Flexible
Staking.
b. No need to lock, and you can trade anytime.
c. It's suitable for users who needs flexible asset but it has lower returns.
https://www.binance.com/en/pos
RISK MANAGEMENT & POSITION SIZE

Sr. Explaination
In Trading/Investing it is not about "how much you Make", but "how much you don't Lose".
R/R Ratio (Risk to Reward

Ratio) reflects how much
Risk a Trader is taking for a
Certain Reward in a Trade.
1 2% Rule a. In traditional financial world, 2% Strategy mean a Trader shouldn’t Risk more
than 2% of their account on a Single Trade.
b. If you’re a more active trader, and especially if you’re starting out, then the rule
will be 1% that means you shouldn’t risk more than 1% of your account in a single
trade.
2 Position Size Calculation Let’s say we have a $5000 account. We’ve established that we’re not risking more
than 1% on a single trade. This means that we can’t lose more than $50 on a single
trade.
- Account size – $5000
- Account risk – 1%
- Invalidation point (distance to stop-loss) – 5%
Position Size Formula:

Position Size = Account Size x Account Risk / Invalidation Point
Position Size = $5,000 x 0.01 / 0.05 = $1,000

The position size for this trade will be $1000. By following this strategy and exiting at
the invalidation point, you may mitigate a much larger potential loss.
https://academy.binance.com/en/articles/how-to-calculate-position-size-in-trading

Understanding Crypto: Crypto Affairs of Pakistan Sycap

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CRYPTO AFFAIRS OF PAKISTAN SYCAP By: Umar Khalid

CRYPTO AFFAIRS OF PAKISTAN SYCAP

C Proof of Work (POW)

D Proof of Stake (POS)

E Diff Technology Coins (Than BTC)

F Token (for Decentalized Apps - dApps)

G HARD FORK VS SOFT FORK

Difference Between Coin & Token

3 ATL All Time Low. Can be in different time frames.

TYPES OF TRADING / TRADERS

CANDLESTICK PATTERN SUMMARY

2 TWO CANDLE PATTERN

3 THREE CANDLE PATTERN

PRICE INDICATION - TREND LINES

3 4 EMA Indicator a. Shows the Market Trend (Bullish / Bearish)

ii. MOMENTUM INDICATORS (OSCILLATORS)

1 RSI Relative Strength Indicator is a Momentum Indicator

iii. VOLUME INDICATORS

1 Volume a. It show the Volume of Trade In or Out in Histogram

iv. VOLATALITY INDICATOR

2 Relative Volatality Index a. It show Price Valatality similar to RSI

3 ATR Average True Range considered to be one of the best Indicator

GOLDEN RULE FOR COMBINING

FUTURE & MARGIN https://academy.binance.com/en/articles/what-are-perpetual-futures-contracts

5 Margin Level a. The formulato calculate the Margin Level:

c. The funding rate is based on 2x Components:1) Interest Rate and 2) Premium.

e. So when a Perpetual Futures contract is Trading on a Premium (higher than

RISK MANAGEMENT & POSITION SIZE

R/R Ratio (Risk to Reward

Position Size Formula:

Position Size = $5,000 x 0.01 / 0.05 = $1,000

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