Technical analysis is a reliable assistant in cryptocurrency trading, without which you cannot do without. There are thousands of indicators on the basis of which crypto traders develop their own strategies.
Most of them can be difficult for beginners to understand. But there are also effective strategies that have gained great popularity among novice traders due to their simplicity. In this article, we will talk about such strategies that will not be difficult for a beginner to understand, but at the same time, they will help in trading. It is interesting that cryptocurrency is becoming more popular every day – today with help. cryptocurrencies can even be paid in online stores and even in many casinos, for example, live casino Canada.
How to use indicators
Technical indicators reflect real market performance and help identify key support/resistance, overbought/oversold levels, trend direction, and more.
With the help of indicators, crypto traders can find the optimal market entry points and receive signals to buy and sell cryptocurrencies with a certain accuracy.
Based on indicators, traders create their own strategies. As a rule, indicators are used combined for more accurate signals so that the trader can see a more complex picture of what is happening in the market. This eliminates unnecessary noise and allows you to extract the necessary information faster and better.
Tip 1. Don’t trade on signals
Cryptocurrency trading signals are a very popular topic today. In almost every social network, messenger, and on-site on the Internet, you can find an advertisement or a community that talks about secret VIP signals that allow you to earn from 300 to 2000% in one evening. You can very easily see for yourself by asking the appropriate query in the Google search engine.
Many beginners fall for this marketing ploy and subscribe to such signals (sites, groups), which, by the way, are most often paid. After that, they are told at what point to buy a particular coin. Most often, of course, only those who created them earn on such signal communities. Pump organizers buy a coin in advance and only then announce it to everyone else. When a crowd of hamsters rushes to buy it “before the pump”, this will lead to an increase in the rate of this cryptocurrency, and the organizers will merge it on an increase.
Tip 2. Don’t wait for the highest/lowest coin price
At this point, many novice traders come across. Even seasoned cryptocurrency trading veterans make this mistake from time to time. The task of a trader is to buy cryptocurrency at the lowest price and sell it at the highest. That is why absolutely everyone is waiting for either the global bottom of the cryptocurrency market when prices will collapse several times or lightning-fast growth when crypto coin rates fly high into the sky.
For this strategy, it is best to use a cool head and common sense. In general, you need to control your emotions. However, in reality, emotions take over, and human greed manifests itself. Excessive greed is a trader’s worst enemy. Since it is she who does not allow buying / selling cryptocurrency at a certain favorable moment, constantly whispering that there will soon be an even lower or higher price, that you still need to wait, and then it will be possible to buy or fix profits.
In general, excessive greed for a trader is very bad. It will only get in the way of your successful cryptocurrency trading. No need to expect constant mega profits from every deal you make. Successful trading of cryptocurrencies is about consistently making small profits all the time, and not luck or bad luck from time to time. Stick to the right strategy, and do not play on the stock exchange, like in a casino.
The cryptocurrency market is unpredictable, and anything can happen in it in a few minutes. Therefore, if you have a good opportunity to make profits without risking once again, then do it! Otherwise, it may be too late later.
Tip 3. Analyze and think ahead
Most of the novice investors and traders in the cryptocurrency market are a solid herd that acts according to the laws of the majority. They are also called hamsters.
When bad news about the world of digital currencies comes out (and this happens quite often), when an influential person makes some kind of negative speech about Bitcoin, then hamsters on such a negative wave immediately run to sell their crypto coins, fixing huge losses most often. They explain their actions by saying that they only want to keep the rest of their savings and do not want to lose all their investments.
All this, of course, leads to Panic Sell and puts the market into a terrible correction before the first positive news about the world of digital currencies. Then everything returns to normal, and the upward trend begins. And these moments of the fall/rise of the coin rate must be used by the trader to benefit.
Cryptocurrency trading requires a different mindset than the herd mindset. Otherwise, it will be fraught with negative consequences. Any competent trader should only think ahead, assessing the situation in the crypto market, which will be in the near future. For example, they demanded the news that Bitcoin is a bubble and a pyramid. What will be the reaction of people? What will happen to the Bitcoin exchange rate the next day?
Cryptocurrency news, which most often affects the growth/fall of the market, must be evaluated from the point of view of a large mass of inexperienced traders – hamsters who want to make a quick profit and succumb to the behavior of the crowd. By analyzing their actions and predicting the behavior of tomorrow’s market, it will be possible to predict the corresponding fall or rise in the rate of crypto coins. This is where you need to make profitable deals, selling/buying coins at better prices. Moving with the whales, not with the hamsters, is how cryptocurrency trading works.
In general, analyzing news, people’s behavior, and the trend of the cryptocurrency market is the main skill of a successful trader. Only by predicting the probable future one can learn how to earn a lot of money in this field of activity.
