How to use an order book when trading?

Photo - How to use an order book when trading?
Book of orders is an exchange tool that displays the current number of traders' orders to buy and sell an asset.
On cryptocurrency exchanges, an order book is like a sequential data list. It contains information on how much cryptocurrency and at what price traders are ready to buy at the moment. In other words - at what marks they’ve placed their orders.

Sometimes an order book may be referred to as a book of requests. But do not confuse it with the book of transactions - it includes already closed positions of traders.
Order book for the $BTC/$USDT trading pair (WhiteBIT)

Order book for the $BTC/$USDT trading pair (WhiteBIT)

It is necessary to use an order book to determine the strong asset levels. If users have concentrated a lot of buy or sell orders at any price, then this price indicator will be quite difficult to “break through”. Traders rely on an order book when placing their own orders to trade in accordance with market sentiment.

Based on the working time frame, market participants can change an order book configuration. Exchanges allow you to group orders from a few decimals to tens or hundreds of coins. 
Grouping an order book according to the coin number

Grouping an order book according to the coin number

An order book is often used by scalpers in short-term transactions. Traders “hunt down” large orders to place their order in front of them and capitalize on the tiniest price fluctuation. In this case, an order book is often not enough. It might be necessary to resort to third-party software that shows data in more detail. Such applications include Tiger Trade, CSclap and others.

However, an order book trading is not as easy as it seems. Firstly, large orders are often published by bots and have the ability to move, which is why transactions have to be constantly edited.

Secondly, there is no such order book that might be applicable to all exchanges. Each trading platform has its own client pool that places limit orders. And these orders may differ, depending on the market situation.

Thus, a book represents the main value for high-frequency trading, where it allows you to determine the price for opening long and short positions. In terms of investment, an order book gives the support areas understanding that are of most interest for users to buy an asset.