GDAX platform is a bit more complex than the Coinbase because it allows the users to trade the cryptocurrencies, instead only buy or sell them. It means you will require a bit of experience at how cryptocurrency exchanges actually work.
How Does It Work?
Markets are quite volatile and the prices will rise and fall quickly, thus it is important to ensure you understand some key features. Cryptocurrencies you wish to trade are known as ‘Pairings’. For instance, if you wish to trade your Bitcoin with Ethereum, you have to access BTC or ETH pairing. You also can trade cryptocurrencies against the fiat currencies on the GDAX, like BTC and USD pairing.
Most basic option will be called ‘Market Order’ that means you are buying and selling the coin at a current market price. Suppose you select this option, then your trade will be executed normally within some seconds.
Next option accessible at the GDAX is ‘Limit Order’ option. It is where you select the price that you wish to trade. Order will just be completed when current market price have reached the price that you selected. For instance, if current price of the Litecoin was $100, and you felt price will go down, you can set the limit order for over $85. Suppose the current market rate went down to say $85, then the trade will be executed automatically. This order will get canceled if price does not reach the limit order.
The further option accessible at GDAX is ‘Stop Loss Order’. It protects the trade from losing a lot of money if price of the coin goes down.
