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Websites for Chart Analysis
There are many websites that offer crypto-assets charts. Tradingview is one of the best websites for chart reading and analysis. Tradingview offers many tools and indicators for chart analysis. Coinmarketcap and Coingecko also provide charts for cryptocurrencies but not have many tools and indicators available for analysis.
1 Bitcoin = 100 Million satoshis (1.00000000 BTC)
An exchange is a platform that connects buyers and sellers. Users can buy and sell the available cryptocurrencies on the exchange. The top exchange for trading is Binance, BitMex, and Kucoin.
Fear of Missing Out. This happens when we see a coin rising rapidly and buy the coin without any research just for making quick profits or not to leave behind by the train.
FUD means Fear, Uncertainty, and Doubt. The investors or traders are not sure about the next movement of the coin and sell their coins at market price cause panic and heavy selloff.
The total number of coins ever exists. The total supply in the case of Bitcoin is 21 Million.
The number of coins in circulation means the number of coins that are already mined.
Bull market means the price is in an uptrend. The coin is making higher highs on a given timeframe. Bull markets depend on time frames. If you see the BTC chart from 2010 to 2020 you will find out many bull markets on the chart.
Bear market means the price is in a downtrend. The coin is making a lower low on the given time frame.
Note- A Bull market can have many bearish cycles and vice versa.
Current Market Price
Market Cap is the product of the current price and circulating supply.
A condition where the market is increasing without any technical or fundamental basis. The market continues increasing irrespective of market conditions and sentiments. The best example of a bubble market is Tulip Mania.
Trading bots will continue trading the whole day according to their setups.
Swing traders buy and sell a coin in a daily or weekly time frame. Swing traders not hold the position for long.
Positional traders wat for the best entry and hold the trades for weeks or months to gain maximum profits.
Day traders complete the trades daily. Either they are in profit or loss they will close all positions at the end of the day.
Some exchanges allows you to buy or sell the coins in more quantity than you have. This can be possible with leverage. E.g. Many exchanges like Binance, BitMex, Kucoin, Bitfinex provides leverage trading. The exchanges allow users to borrow extra money from the exchange and trade with that. You can open a position of $2000 with just $200 by using the 10x leverage. Leverage may vary according to exchanges and coins.
The total amount of funds required to open a leveraged trade. If the margin value drops below of the position value, the position will be closed. E.g. If you want to open a $2000 trade with 5x leverage than the margin required will be $400. $400*5=$2000
Long position means buying assets with leverage. The profit and loss depend on the leverage takes. If the leverage taken is 5x and the spot price moves 10% up than the total profit on a long position is 50% — the exchange fee.
Short entry is the opposite of a long position. If you think the price of the coin will go down in the coming days or weeks, you can open a short position with leverage.
A trader holding a big position of a coin for a long time.
Volatility is the percentage change in the price of an asset. Traders check the daily volatility of a coin before opening a short or long position.
Return-on-Equity. ROE is calculated by the actual margin used in a position.
All coins except Bitcoin are known as altcoins or Alts.
A person that has a big bag of a given coin.
The price of a coin will increase suddenly and the retails traders start buying it. The price of the coin will come down after a fake out on the chart and many long positions will be liquidated.
is just the opposite of the bull trap.
Sell orders are asks and Buy orders are Bids.
Spread is the difference between the buy and sell orders. Basically, exchanges with high volume have low spreads and vice versa.
Support and resistance
Support zone/line is where the price of coin bounced back many times. Resistance zone/line is from where the price of coin retraced many times.
Large orders at a specific price are known as walls. There are buy walls and sell walls.
Stop-loss is the price where the traders want to cut the losses. If you bought a coin at 100 and put a stop loss at 90 means your position will be closed if the price drops 10%. Stop-loss is a necessary thing in trading to counter the wild moves.
Liquidity is the measure of how actively the coin is traded on the exchange. High liquidity means there are more buyer and seller on the exchange. High liquidity also means that the spreads will be low and orders will be filled easily.
The price is said to be in uptrend if it makes higher high (HH) and Higher lows (HL) in the given time frames.
Opposite of uptrend, the prices here make lower highs (LH) and lower lows (LL).
A price range where the price of coins will trade after a rally or sell-off. The market will be volatile after breaking the consolidation zone.
A correction is a fall in price after making a new peak or an upwards rally. In the Crypto market, we see a 20–30% drop in price after reaching an all-time high.
Traders will start booking profits after a rally, this will trigger a sell-off and the price of the coin will decrease.
Rally means an immediate increase in price of a coin.
A chart pattern is a predefined shape that has been historically studied by technicians. Traders try to use these previous performance statistics to predict future price movements.
Order will execute at a predefined price if the market reaches that price.
An order to buy or sell at the current price level, executed immediately.
Time Period/ Time Frame
Time period is the difference between the formation of candles on the chart. Common time periods are 5 min,15min,30 min, 1Hour, 4 Hour, Daily, Weekly, and Monthly.
All-time highs prices.
Trying to lower the average entry cost of a position by slowly buying the asset at reducing rates.
Initial Coin Offering (ICO)
A type of crowdfunding using cryptocurrencies as a means of raising capital for early-stage companies.
A condition where the positions are closed because there is not enough margin available in the account.
A trading method to buy coins from an exchange that have low price and sell it to another exchange that have high price. E.g. If Bitcoin is trading at $5000 on Bitstamp and $5000 on Bitfinex, People will buy from Bitstamp and sell on Bitfinex.
Pump means a sudden increase in price because of a news or a group promoting the coin. Dump means a sudden decrease in price due to a negative news or heavy sell-off.
Everyone wants to increase the amount of Bitcoin one is holding. Trading will help you to increase the amount of Bitcoin or Fiat (whatever you prefer). There are many opportunities in the crypto world to double (or even more) the amount you holding. You must look and grab the opportunity at the right time. Trading Altcoins is also another option to earn bitcoin from trading. Trading needs times and efforts. A good trader can make 6–8 successful trades out of 10. A trader must know how the market works and how market reacts on different situations. I will continue to share trading related knowledge free of cost. Many telegram channel and groups cost from $100 to $500 monthly for learning basis of trading. I will be releasing more such articles over-time to help you learn to trade. Feel free to contact me in case you’d need any help.