Learning how to read crypto charts is an essential skill for anyone interested in trading Bitcoin successfully. At first glance, trading charts can seem like a foreign language. All the confusing lines, shapes, and colors can make it seem very intimidating for beginners. Additionally, learning technical analysis requires that you begin to learn the jargon associated with trading.
Luckily, crypto trading is very similar to stocks. In fact, the only real difference is the asset. Both assets utilize the same fundamentals. You can study up on some of the greatest stock traders in the world, and you will give yourself an amazing edge in the market.
Remember, trading isn’t about being different. It’s about understanding the psychology of the market. In other words, you don’t need to reinvent the wheel. At first, you will see more success by following the path of established traders that have practiced this skill for years. The great news is that once you understand how to trade Bitcoin, you can trade a vast array of assets classes.
Step one on your journey to becoming the ultimate Bitcoin trader is to get familiar with the basics of trading. You will need to familiarize yourself with the key theories and terminology used today. You will also want to have a firm understanding of different chart types and pattern recognition.
Luckily, in terms of trading, market history has a tendency to repeat itself. Consequently, analysis allows you to recognize these trends and use them to make an informed decision on the market movements of the future.
The Dow Theory is a strategy developed by Charles H. Dow., hence its name. Dow, along with Edward Jones and Charles Bergstresser, founded Dow Jones & Company, Inc. The trio went on to develop the Dow Jones Industrial Average in 1896.
The Dow Theory provides you with valuable insight into market movements. It states that the market price takes everything into consideration. Every factor including outside developments and all prior, current, and future details combine to establish the market value of an asset.
This theory means that as an experienced trader you must be able to monitor multiple variables in the market. You will learn to understand the current, past, and future demands of your asset community. This learning must come from a constant gathering of information and market news. You should always pay special attention to any future regulations.
The Dow Theory means that all price movements are not random at all, quite the opposite. Price movements follow larger trends. These trends can be broken into two categories – short and long term trends.
Bitcoin Market Analysis
In technical market analysis, you focus on a coin’s price specifically. This strategy requires you to utilize technical indicators and ignore outside variables contributing to the price. In this way, you are able to remove emotion from your decisions.
6 Tenets of Dow Theory
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