1. Analysis of Short Selling and Shorting Mechanisms#
Short Selling: Refers to the judgment of a downward expectation in market trends.
Shorting: The selling operation implemented based on the short selling judgment. It should be noted that direct short selling in the spot market is not possible and requires the use of futures contracts or leveraged trading tools.
Detailed Explanation of Short Strategies:
When investors determine that the current coin price is high and there is potential for a downward movement in the future, they adopt a "sell high, buy low" operation model:
- Sell the held assets at the current price.
- Repurchase to close the position after the coin price drops.
- Obtain profits through the price difference.
Example Demonstration of Shorting Operations#
Assuming a certain token is currently priced at 10 yuan, the operation process is as follows:
- Mortgage 2 yuan as margin to borrow 1 unit of the token.
- Immediately sell at the market price of 10 yuan to obtain cash.
- Repurchase and return when the token drops to 5 yuan.
- After settlement, obtain a net profit of 5 yuan (excluding interest costs).
⚠️ Risk Warning:
If the coin price rises beyond the margin threshold, it will trigger a forced liquidation (margin call), resulting in a total loss of principal.
2. Analysis of Bullish and Long Mechanisms#
Bullish: Refers to the judgment of an upward expectation in market trends.
Going Long: The buying operation implemented based on the bullish judgment. Directly buying in the spot market constitutes a long position, achieving profit through buying low and selling high.
Detailed Explanation of Long Strategies:
When investors predict that there is potential for the coin price to rise, they adopt a "buy low, sell high" operation model:
- Purchase the target asset at the current price.
- Wait for the coin price to rise and sell at an opportune moment.
- Obtain profits through the price difference.
Example Demonstration of Long Operations#
Taking SOL trading as an example:
- Buy 1 unit when the current price is 140 U.
- Hold the coin until it rises to 280 U and sell.
- Achieve a profit of 140 U from the price difference.
Explanation of Market Roles:
Bulls and bears do not specifically refer to individuals but represent groups of investors with the same market expectations.
Summary of Core Concepts#
| Term | Definition |
|---|---|
| Going Long | Expectation of rise → Buy at low price → Sell at high price for profit |
| Short Selling | Expectation of decline → Borrow and sell → Repurchase at low price for profit |
| Bull | Group of investors holding a bullish expectation |
| Bear | Group of investors holding a bearish expectation |
@Unintelligible sol Original
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