You might be going low-spirit as your learning to cryptocurrency is not coming to an end. You have come through the big jargons, “Cryptocurrency”, “Blockchain”, “Exchange” and the working. Now you come across one more “Trading Indicators and Chart”.
The experienced or expert traders are very well aware of what is being talked about. But the newcomers or not so professional traders are in question. Encrybit – The Future of Exchange, recently conducted an online survey which derived that nearly 60% of them were not aware of trading indicators and charts.
What they basically are?
Fundamentally, there are two types of indicators: Economical and Technical. The indicators used for trading are the technical ones. Let’s focus more on it.
As you know, these markets: cryptocurrency, forex and stocks are volatile. The price of respective assets confronts ebb and tide. To stay persistent in this speculative market, it is inevitable to stay futuristic in a way which helps to predict the price. So that you can plan your next move wisely.
Now how to do that? That’s where trading indicators come to the rescue. These technical indicators help to predict future prices based on asset’s volume and price. It is all grounded on mathematical calculation and in the context of technical analysis.
The most widely used technical indicators are MACD (Moving Average Convergence-Divergence) and RSI (Relative Strength Index).
Many of you might think that trading indicators and charts are the same. But it is not true. The study based upon market action is chart analysis. The shift in price is studied under this. Actually you use charts and indicators in combination to form profit-making strategies. These charts can be displayed in different time frames as per the period selected by you. You can follow the tutorials on how to read the charts and overcome the randomness of trading at a longer run. The types of chart used commonly are:
- Candle stick
- Bar chart
- Line chart
- Tick chart
- Point and figure chart
Some allow to draw a line and carry out the calculation.
What the rest of the traders have to say?
The survey by Encrybit also had some professional traders as participants. They expressed their views on most commonly used trading charts and indicators. Let’s check it on!
- For trading charts, the most likable is line chart and candle chart followed by mountain chart, bar chart, renko chart and kagi chart.
- For trading indicators, the top scorers are MACD, SMA (Simple Moving Average), EMA (Exponential Moving Average) and RSI followed by ADX (Average Directional Index) and Stochastics.
So, instead of relying on the prediction of others, why not calculate yourself and be safe? These technical tools will help detect trend signals and any other signs of dump. You can set a time frame and adjust the variables to your preference. Thus, helping you to set up your own entry and exit strategies. It will require a lot of patience to learn and research but once you are a pro, you’ll trade like a boss!