Fundamental Analysis and Technical Analysis ...
Basic analysis
It is used to estimate the value of a business or asset, such as market conditions, market and growth rates, company reputation and management.
Technical analysis
It is to predict future market movements based on price and volume in the past. Supply and demand are the analysis of market forces as well as representations of market psychology.
Cryptocurrency markets basically have three price movements. It is up, down or horizontal. The bullish (generally green color on the charts) if the price is upward and the bearish (generally red on the charts) are considered the dominant force. The market showing a horizontal course is considered as accumulation and consolidation.
Traders should at least know the basics of reading charts in order to predict the market trend. Candlestick charts are one of the most important charts that cryptocurrency traders refer and make use of when planning.
Comprehensive study of candlestick charts and patterns combined with an analytical mindset and adequate practice can give traders an advantage in the market.
They consist of wax-shaped lines and rectangles. They provide price information for the time period selected in the chart. With a single candle you can see six different data for your chosen timeframe. These; opening price, closing price, price direction, highest price, lowest price and volume.
Open: It shows the opening price.
Close: It shows the closing price.
Price direction: Red (Black available) indicates declining, green (White available) indicates rising.
High: Shows the highest price.
Low: Shows the lowest price.
Volume: shows the total traded amount of the cryptocurrency.
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Indicators supporting the candlestick chart;
SIMPLE MOVING AVERAGE (SMA)
It is the daily price of a coin divided by the number of days. Sample; For 100 days SMA; The price of 100 days is added up and divided by 100.
Generally, averages of 50, 100, 200 days are used. The number of days may vary depending on the character of the crypto money you follow.
The line provides insight to the investor with their movements above or below the price. It is a versatile indicator that can help you identify trend trend, support and resistance levels. It also shows when a new trend starts and when a trend is going to reverse. Since the price is upward, the simple moving average below the prices shows support levels. If the price goes below it indicates the resistance levels and the direction is a downward pattern.
RELATIVE STRENGTH INDEX ( RSI )
It is an indicator that measures the magnitude of recent price changes to assess the overbought or oversold conditions of a stock or other asset.
It is understood that an asset with a value of 70 or more on the RSI indicator can reverse the overbought and trending trend. 30 or less indicates oversold.
BOLLINGER BANDS ( BB )
It consists of bands drawn below and above the standard deviation of a 20-day moving average.
In trend channels, prices move back and forth between the bands, the prices approaching the upper band generate the signal of being ready to sell, and the prices approaching the lower band. Prices that have come up to the upper or lower band often move and reach the other band. BB midband break is very important both as support and resistance. The break of this band can be evaluated as the change of the current trend.
As the mobility in stocks increases, the bands expand; bands narrow as mobility decreases
MOVING AVERAGE CONVERGENCE DIVERGENCE ( MACD )
It is a frequently used and trusted indicator in technical analysis due to its positive results in trading.
The MACD indicator is a momentum indicator that is a trend follower and shows the relationship between two different moving averages of prices. It is basically obtained by subtracting the 26-day exponential moving average from the 12-day exponential moving average. The signal line on the MACD indicator is used as a trigger for buy and sell signals.
Result
The candlestick chart and 3 indicators can guide you. There are lots of indicators to help you out. You have just started. As you gain experience, you look at other indicators. Follow the social media of the cryptocurrencies you follow and / or receive, such as telegram, twitter, youtube. Get information on time. Follow the articles, social media such as twitter and youtube of the traders you trust. Follow safe newsgroups. Listen to everyone but decide for yourself….
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