Whether you have just begun investing in Bitcoin or have been here for a while, information is your best friend. The more data you have to analyze, the better chance you have at recognizing trends and, ultimately, making money.
A Bitcoin live chart is one of the most valuable tools to have at your disposal. If you aren’t really sure how to use it, here are a few helpful tips that can have you reading a live chart like a pro in no time.
Candlestick Charts
There are plenty of ways to look at trends not only in Bitcoin but cryptocurrency as a whole. Candlestick charts tend to be preferable to the others for a few reasons. For starters, candlestick charts offer a lot more information than the other chart types.
Candlestick charts so the market’s price movement as a positive or negative over a certain period of time. Even better, they use green and red, making it easy to quickly visually identify whether things are moving in a bullish or bearish way. It is the simplest and best kind of chart to use no matter what your level of cryptocurrency investing may be.
Moving Averages
There are a few technical indicators that you will find in the average chart. Moving average is going to be in just about every one of those and it helps to cut out some of the unnecessary or confusing data, instead focusing on the average price for that cryptocurrency. Averages can even be adjusted to look at specific periods.
Averages come in 10, 20, 50, 100, and 200-day intervals. You can get a much clearer picture of what movement is like and how volatile that cryptocurrency may be. If you really want to get complicated, then you can look at simple moving average or weighted moving average to weigh recent prices. The customization of these charts is definitely another major perk that makes it easier to track cryptocurrency in a way that makes the most sense to you.
On-balance Volume Indicator
This is a technical indicator that puts the focus on the trading volume for a specific cryptocurrency. The belief behind it is that trading volume plays an integral role in the overall movement of prices in the cryptocurrency markets. It can be a bit confusing to someone fresh to this investment type but can be invaluable to more seasoned investors.
It is a cumulative indicator that moves depending on the volume of whatever dates are within the range. Investors can confirm trends, whether it be falling or rising prices. There are formulas that can help you calculate OBV and break it down in a way that makes the most sense based on your investment strategy.
Relative Strength Index
There is something to be said about the momentum of a cryptocurrency. Whether you want to track something you own and see it rise or get in on a cryptocurrency that you have been eying for a long time, the momentum indicator is a great way to determine whether that asset is being oversold or overbought.
Reading the RSI is easy as the line is between 0 and 100. Most RSIs you find will use a 14-day timeframe. If a cryptocurrency is oversold, the value drops below 30. If it’s overbought, the value is above 70. Being oversold is a good indicator that you should consider buying while being overbought is a good indicator that it might be time to move from the position and sell. These tools can help confirm the moves you are considering.
