However, they forget that there is actually a third type of market trading condition that could be in play which is known as consolidation. The majority of people think that markets will only move up or down. Remember, a trader really only makes money if the coin is trending so it is important for the trader to identify these trends in order to get into them early enough to maximize gains. Trends are what traders use to identify the direction of any particular coin in order to make a trade and bank some profit. The wicks of the candles are prices that the coin reached before that particular candle closed and it represents the total trading range of the coin during each period. This means that a long green body would indicate strong buying pressure and a small green body would indicate weak buying pressure. The actual length of the body of the candle indicates the buying/selling pressure within the coin during that period. On the example above, the daily chart has been selected so this means that each candle represents 1 day of trading action. The length can range from 1-minute candles to 1-month candles. The period is the length of time that each candlestick takes to form and is selected by the trader. The real body (the bar) of the candlestick shows the difference in the price between the open and close of the period. Let me zoom in closer to some candles so you may have a closer look at them
It consists of a real body with wicks (or shadows) on either side of the real body. A candlestick chart will always include all the characteristics of price and may provide more data for traders to analyze cryptocurrencies. The volume of the range is usually always printed at the bottom of any candlestick chart. The most popular type of chart that you might have come across in the cryptocurrency world is known as a Candlestick chart.
It leaves out the opening, high, and low prices. For example, the line chart only uses the closing price data to create a chart. You can see that the price of the coin is represented by one long line that moves up and down.Īlthough this is a very easy method for understanding coin movements, a line chart may be very limited compared to others when used in the trading analysis. This simply plots its points from the closing cost of the previous period to the next closing period. There is also a chart to see a visual representation of a coins market cap.Īn example of a chart that you may be familiar with is known as the line chart. These include tools such as point & figure chart, bar chart, a tick chart, a volume chart, and a range bar chart.
These four characteristics are the typical data points that are used to print on the chart to create the trends in the market that we see today and are used for trading.ģ.1 As we go to press… Types of crypto chartsĪlthough it seems that there is a limited number of variations to representing cost against time, there are still a fair few numbers of different types of tools available for crypto traders to do analysis.
0 kommentar(er)
