The only, true and magical solution for the 100%-analysis of crypto-currencies there are, of course. However, there are two fundamental questions that will help us in the solution of the problem. To put it differently: there are two questions we need to answer in order to get a good strategy, which helps us in the analysis and evaluation of Crypto-Assets.What are the indicators (chart analysis + fundamentals) that describe currencies of the behavior of Crypto?What data sources exist (and are even still relevant), to analyze a (certain) crypto-currency?The answer to that, we want to look at now. It contains elements of classical market and chart analysis, and other elements that are unique to specific to the crypto market.Chart analysis understand the two or three major points, i.e., indicators from the chart analysis and fundamental data as well as data sources, should be classic indicators trend indicators(the) Momentum as an indicator of volatility as an indicator volumes as indicators of crypto – specific indicators – fundamental data network data log data source exchanges as DatenquellenOn-Chain activities, i.e. the Blockchain as a data source social Media as a source of financial market as an influencing Factor is the Basis of a holistic assessment of crypto-currencies. In the Following, we will go again on each of the indicators in the chart analysis. The two aspects of fundamental and data sources, we will examine the data in further articles in more detail.
Contents
Chart analysis – understand indicators in the Overview
There are a number of indicators that are relevant and helpful to analyze crypto currencies. Most of them are indicators of the traditional financial market, which are already used for decades to chart analysis. A few other specific indicators, however, are crypto. In the Following, we give a brief overview of the four above-mentioned indicators (Momentum, Trend, volatility, and volume). In the future, we will describe each indicator in Detail and explain.
Chart analysis – understand Trend as an indicator
As the Name of the Trend suggests, serve as Trend indicators can help traders the Trend, i.e., the direction) of a crypto-currency, you are trading just. There are basically three possibilities: the Trend of a crypto-currency can go down (=bearish trend), he can tend to the top (=bullish trend) or sideways (no clear direction).Examples of this are the Moving Average Convergence Divergence (MACD), or Expo’s potential move ring Average (EMA). The latter indicator takes the prices of a crypto-currency for a selected period of time (5, 20, 50 or 200 days) and weighted these according to a certain pattern; in our case, the courses of the last days will be weighted particularly heavily. This is an average value that can be used as an indicator of the current rate is. The MACD uses the EMA and is another popular indicator.You are trading on the world’s leading Social Trading Platform, you join the millions of people who have already discovered how it smarter to invest by copying the best investors in our Community, or be copied and as a result, a second income can be achieved. Start now!
Chart analysis – understand Momentum as an indicator
Under the concept of Momentum (including Momentum indicator), we mean indicators that measure the strength and speed of a particular parameter of a crypto-currency; typically, this is the price. A Momentum indicator to decide the Trend indicator in that it is not necessary, the past into account/historical pattern.As an example, the RSI (Relative call Strength Index) to. This measures the speed and intensity (=Amplitude) of the Change of current Trends. He sets up so the up and down movements of a crypto-currency in a certain period of time in a Relationship. In other words, it serves as a High (short-term) or to anticipate low points and, therefore, the Trend in the rate development to identify at an early stage.
Chart analysis – understand volatility as an indicator
The term volatility is most likely to be known. Volatility measures the magnitude of variation of an award, regardless of its direction. In other words: the Fluctuation of the price of a certain crypto-currency is measured over a period of time. A high level of volatility arises then, if within a short period of time, the price often goes up and down – figuratively speaking, as in the case of a roller-coaster ride. This is especially in the crypto market. In the case of slow movements (such as in established asset classes), we have a low volatility. In relation to the chart analysis, we can mention here for example the Bollinger bands as an indicator.
Chart analysis – understand volume as an indicator
Volume indicators give us relevant metrics and information about the (yeah) the traded volume of a specific asset. This can relate to the traded volume contracts (such as Futures) or the entire volume traded on the spot market. Even if the volumes as indicators sound trivial, they are useful to confirm or reject whether there is a Trend of an asset continues, flattens out or reverses.A relatively more intuitive indicator is the On-Balance Volume (OBV) indicator. This sets the volume of the market and its Changes in connection with price movements. Thus, the assumption that large Changes in trading volume large price changes. If the volume of trading of the crypto market rises, so within a few days, after the OBV indicator can be assumed that the prices follow suit soon. The reason for this could be, for example, the interest of Institutional investors. On the other hand, a drastic decline in the trading volume as an indicator for a drop can be interpreted as interest, and therefore falling prices.
Chart analysis – understand the journey is the destination
We note that, in addition to the technical indicators for chart analysis the elements play fundamental data and data sources an essential role for the evaluation of Crypto-Assets. With today’s article I wanted to give you an Overview and the need for a holistic approach point. In addition, we have classified the indicators and some examples of the respective classes to be called. The indicators, as such, we will examine in the future in more detail.Even if (or precisely because) we can never meet one hundred percent of the statements about the future, and the crypto world is distinguished particularly by their own species, it is important to have a solid Framework in different aspects of thinking and rating. It is important to understand that “everything hangs together” and the sum of the individual things move the Whole.75 % of private CFD accounts lose money. No EU investor protection.What are your most important Learnings from today’s article “chart analysis” to be understood? Come in to our Telegram Chat and talk with the experts and the Community. Subscribe to our News channel to not miss any News. (Image Source: Shutterstock)