Cryptocurrency analysis: the basics of market movements fore

Cryptocurrency analysis: the basics of market movements fore

From Zulfqar Chachar

Contradicting many false beliefs, crypto trading is far from being solely based on luck. In reality, it is a combination of experience and knowledge, the ability to do an in-depth cryptocurrency analysis, evaluate the...

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Contradicting many false beliefs, crypto trading is far from being solely based on luck. In reality, it is a combination of experience and knowledge, the ability to do an in-depth cryptocurrency analysis, evaluate the current state of the market, and predict its movement. Although one can possess all the needed skills to be successful in this area, with the backdrop of the emergence of huge number of cryptocurrency exchanges offering users various crypto tools, it becomes more and more difficult for newcomers to enter the market. In order to deal with at least one cryptocurrency analysis tool, a novice trader needs to navigate through basic terms and concepts, immerse himself in the work of all mechanisms, and also constantly have finger on the pulse of the cryptocurrency industry. There is absolutely no need to be terrified when using a cryptocurrency analysis software, the main thing here is to understand that the digital asset market is a volatile environment and only a competent forecast and analytics will be your main partners in achieving your goals.

The progressive crypto market already provides a lot of opportunities for traders, one of which is not to be limited to functionality and analytics of any particular exchange. For example, an all-in-one GoodCrypto app extends the crypto traders` capabilities with the help of advance trading tools. With a simple, intuitive and sleek interface, it allows you to effectively apply your knowledge and forecasting skills for achieving the best results on the crypto market. In other words, the app does all the hard lifting for you, allowing to focus your mind on your strategy which you will apply on the market. And in this article, we will consider and get deeper into the main approaches and indicators that are used by professional traders to predict cryptocurrency prices.

Technical analysis

The essence of technical analysis is finding and tracking patterns and trends in the asset`s movement history, which will presumably be repeated under similar circumstances. This approach helps traders to predict in which direction and at what pace the asset`s price will move in a certain period of time. The charts that are formed online are already reflecting the reasons that influenced the price of the cryptocurrency. All you are left to do is to find similar trends in the asset history. For this purpose, various techniques are used.

 

More and more traders use technical analysis in their activities, as it is quite simple and clear due to the fact that forecasting is based on graphs. It is not that difficult even for a novice to trace price changes and find a trend in an asset’s movement.

 Moreover, professionally compiled technical analysis implies an accurate forecast of where and with what probability the price will be in a certain period of time since any trend is most likely to repeat itself. In order to detect the emergence of a new trend in which the cryptocurrency rate will behave in a specific way, the trader can either choose one of the tools amongst the ones that we will consider below, or develop his own method of analysis. 

Technical Analysis Indicators

The cryptocurrency market, which has long been a part of the global financial industry, provides traders with an opportunity to invest in advanced digital assets. And in order to have a noticeable profit from these investments, market players strive to achieve the highest accuracy of their forecasts using various indicators of technical analysis. There are quite a lot of them to choose from, in this article we will consider the most popular and used amongst marketers. 

Volume indicator

The volume indicator differs from other technical analysis tools, however, traders prefer to use it due to its simplicity and effectiveness. In general, the volume indicator does not perform any calculations and doesn`t provide buy/sell signals. The 

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