The buying and selling of assets in the pursuit of profit
In its simplest form, a trader will buy an asset with the hope to later sell it at a higher price. The difference between the two prices is their profit. However, other financial instruments exist that enable traders to bet on an asset’s price depreciation or on its performance into the future.
Traders use a variety of factors to influence their decisions. Some prefer to use the price history of an asset to attempt to predict future trends. By studying past prices, skilled traders can identify familiar patterns that can suggest an imminent move up or down. This practice is known as technical analysis.
Other traders prefer to trade based on news events that may influence the price of an asset. Studying the news with a view to buy quickly on optimistic developments and sell on negative events is known as trading on fundamental analysis.
More advanced traders can take advantage of various order types and instruments to hone their strategy. For example, futures and options allow traders to bet on an asset’s performance into the future, as well as to hedge any spot exposure they might have.
Source: https://www.okx.com/academy/en/what-is-trading