How to use a technical assessment in the CRIPTO currency
The world of cryptocurrencies has recorded a huge growth and adoption in recent years, and prices have been fluctuating wild fluctuations in response to mood on the market. However, outside the speculative nature of this market is a valuable tool that can help investors make informed decisions: a technical estimate.
A technical assessment is an approach to assessing the value of the CRIPTO currency based on their fundamental properties and technical indicators, and not relying only on the movement of market prices. In this article, we will explore how to use a technical assessment in the Crypto currency, exploring its advantages, limitations and best practices.
What is a technical assessment?
The technical assessment includes currency price analysis, trading volume and other technical indicators for assessing its value. This approach focuses on the basic factors that run the market, not just watch market trends or guesses. Using technical indicators, investors can recognize patterns and trends that may not be visible immediately from market data.
Key technical indicators
To get started with a technical assessment of cryptocurrencies, you will need to get acquainted with some key indicators that are usually used:
- Relative strength index (RSI)
: An oscillator of a swing that measures the recent price of safety action over its price range over time.
- Bollinger Bands : Volatility indicator showing two moving average safety prices, showing that it is traded above and below average.
- Moving average convergence divergence (MACD) : An oscillator of a momentum measuring the relationship between two moving average, helping to recognize trends and reversals.
- Storytelling Oscilator : The momentum indicator that over time displays the percentage of the price above or below the movable average.
How to use a technical assessment in the CRIPTO currency
To apply a technical assessment in the Crypto currency, you will need:
- Select Currency : Choose a specific crypto currency you will evaluate, such as Bitcoin (BTC) or Ethereum (ETH).
- Collect data : Collect historical prices and data on trading volume for the chosen currency.
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- Evaluate trends and reverse : Look for signs of acceleration, slowdown or reversal of trend using identified indicators.
Advantages of Technical Assessment
Technical estimate offers several advantages:
- Improved accuracy : by focusing on fundamental properties rather than the movement of market prices, a technical assessment may provide more precise predictions.
- Decreased risk : Investing in CRIPTO currency with strong technical support and trendy patterns may reduce the risk of significant losses.
- Increased transparency
: Technical assessment provides a clear understanding of the basic factors that drive the value of the currency.
Technical Assessment Restrictions
Although the technical assessment has its advantages, there are also certain restrictions that need to be considered:
- The context is a key : a technical assessment should be used together with market feelings and analysis, as prices can be affected by external factors that may not be directly related to the basic basics.
- Complexity : Technical estimate includes a number of indicators, which may be complex to interpret and demand significant expertise.
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Best Practice
To maximize the technical assessment in the Crypto currency:
- Use a combination of indicators : Combine more technical indicators to identify forms and trends.
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