The difference between automated trading and algorithmic trading is open to interpretation, because some people use the two terms interchangeably. However, automated trading usually refers to automation of manual trading through stops and limits, which will automatically close out your positions when they reach a certain level, regardless of whether you are at your trading platform or not.

Algorithmic trading, on the other hand, usually refers to the process through which a trader will build and refine their own codes and formulas to scan the markets and enter or exit trades depending on current market conditions.

A combination algorithmic trading strategy uses both price action, and technical analysis, to confirm suspicions about price action by analysing charts with indicators. Algorithms can then enter buy or sell orders based on this information.

To create a combination trading strategy, you’ll need to carry out analysis of price action on an underlying market. This means having an understanding of different technical indicators and what they tell you about an asset’s previous price movements.

In a combination strategy, you’ll need to establish whether you want to go long or short, and at what time you want the algorithm to trade. You can configure a combination strategy according to the market, the time frame, the size of the trade and the different indicators that the algorithm is designed to use.

There are several algorithmic trading strategies to choose from. Most traders will choose a price action strategy or a technical analysis strategy, but some combine the two.

A price action strategy applies price data from previous open/close or high/low levels of a candlestick chart, to place trades in the future when those price points are achieved again. A technical analysis strategy relies on technical indicators to analyse charts and the algorithms will react to the markets depending on what the indicators show, such as high or low volatility.

Algorithmic trading has many benefits. Most notably, using algorithms removes your emotions from trading, because they react to predetermined levels and can do so when you are not even at your trading platform.

Other benefits include the time they save you, the fact that they can react to price movements faster than manual trading – ensuring you get the best price – and the backtesting and redefining which helps to ensure that your algorithms are performing at their optimum levels.

A blockchain, originally block chain, is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a hash pointer as a link to a previous block, a timestamp and transaction data. By design, blockchains are inherently resistant to modification of the data. It is “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way”. For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority.

Blocks hold batches of valid transactions that are hashed and encoded into a Merkle tree. Each block includes the hash of the prior block in the blockchain, linking the two. The linked blocks form a chain. This iterative process confirms the integrity of the previous block, all the way back to the original genesis block.

A hard fork term refers to a situation when a blockchain splits into two separate chains in consequence of the use of two distinct sets of rules trying to govern the system. For example, Ethereum has hard-forked to “make whole” the investors in The DAO, which had been hacked by exploiting a vulnerability in its code. In 2014 the Nxt community was asked to consider a hard fork that would have led to a rollback of the blockchain records to mitigate the effects of a theft of 50 million NXT from a major cryptocurrency exchange. The hard fork proposal was rejected, and some of the funds were recovered after negotiations and ransom payment.