Crypto trading is becoming more common nowadays and cryptocurrencies are evolving as a key for global financial transactions. Since the arrival of Bitcoin, the growth of cryptocurrencies has surged and attained a peak in the market. So, a lot of new traders are giving huge attention to crypto trading and earning high returns.
To succeed in crypto trading, traders should spend much time analyzing the market, reading the charts, learning how to predict cryptocurrency trends, and driving their own trading strategies to execute profitable trading.
Let’s explore how cryptocurrency trends predictions are made to analyze the market and perform profitable trading.
First, understand the current crypto market.
We know that cryptocurrencies are digital assets that revive financial transactions with enhanced security, improved privacy, and decentralized control. In contrast to the stock market, the crypto market operates 24/7. The prices change from time to time, leading to high volatility. To perform profitable crypto trading, traders need to monitor the market all the time, analyze the ongoing trends, and predict the future trends.
How to Predict Cryptocurrency Trends?
To predict the cryptocurrency trends, traders need to see how prices have evolved over the days, weeks, or months. Traders can go with manual or automated options to analyze the trends. Candlesticks play a major role in analyzing the price of cryptocurrencies fluctuating over various trading sessions and help make comparisons.
Let’s understand Candlesticks.
Each candlestick has two thin lines with a rectangular central body. The bottom of the line represents the lowest price of the trading session, and the highest price is mentioned at the upper top of the line.
When the price goes up from the open price of the market, the candle is colored green and called a bullish candle.
On the other hand, the candle will turn red if the cryptocurrency price decreases. This is called a bearish candle. Everything gets inverted, and the trading session is represented from top to bottom, which resembles an open to close market.
In this candle, the thin line in the bottom shows the low price, and the upper line gives the highest price over one trading session.
This type of candlesticks has benefited the traders over the years. By analyzing the candlesticks, traders can easily predict the cryptocurrency price fluctuations from time to time, trace the charts, and predict the right time to invest in.
Common Candlestick Patterns
Bullish Engulfing Candle – usually appears at the bottom of a downtrend and indicates that the buying pressure is increasing.
Bullish Hammer Candle – denotes that the bears pushed the price down during a specific time frame, to create huge buying pressure.
Three White Soldiers – formed by long green candles, opening and closing significantly higher than the previous trading session (day).
While analyzing the candlestick, it is crucial to get a short-term & long-term view. It will help to take measures to do profitable trading and prevent losses.
EndNote
To predict the cryptocurrency trends, there are a lot of tools and platforms available in the market, which help to make the right buy and sell decisions. Trading gear is a reliable platform that allows access to highly accurate signals and drives efficient outcomes.
