How to identify market trends with technical analysis

The world of cryptocurrency and blockchain is a broad and rapid development panorama where rapid price changes can be exciting and scary for investors. A way of navigating these markets and making conscious investment decisions through technical analysis, which is a basic tool used in economics and economy. In this article, we will consider the basic concepts of technical analysis and provide valuable advice to identify market trends with this effective technology.

What is a technical analysis?

Technical analysis is a method to analyze financial markets studying tables, models and trends using several indicators and tools. It is based on the idea that previous market behavior can be used as a guide for future price movements. There are several types of technical analysis, but we focus on the most popular:

• Graphic models : These are repeated visual patterns that appear in graphics such as trends, translations or continuous.

• Indicators : These are mathematical formulas that are used to predict price changes in the graphic information.

• Bollinger Carriles : A technical indicator that measures the voice attracting two mobile average in a particular area.

How to identify market trends with technical analysis

If you want to identify market trends through technical analysis, follow these steps:

• Select the correct indicators : Select indicators that match your investment and risk tolerance strategy. Some popular indicators are:

* Mobile averages (MA): average prices in different periods of time

* Relative Force Index (RSI): It measures price work and volatility

* Bollinger Lanes: Measures the price of volatility

• Analyze diagram patterns

  : Identify diagram models as trends, turns and turns. Find patterns that are consistent with the current trend.

• Identify overload/excess conditions : Use indicators to detect excessive and overwhelming conditions. When prices reach the level of extreme prices (for example, the highest in history), it can be a sign of possible turn.

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• Confirm trends : Use indicators such as RSI or Bollinger lanes to strengthen trends, especially when combined with other technical analysis tools.

General technical analysis tools

Here are some technical analysis tools common to the top:

• Mobile averages (MA) : Average prices in different periods of time.

• Relative Force Index (RSI) : Measure the price of price and volatility.

• Bollinger Carriles : Measure the price of volatility by drawing two mobile average in a particular area.

• Macd (Mobile average convergence differences) : Mash indicator that detects changes in the trend.

• Stochastic oscillator

  : Measure the relationship between price and relative force.

Tips for effective technical analysis

• Practice, practice, practice : Develop your technical analysis skills analyzing graphics and trends over time.

• Stay disciplined : Stay in your investment strategy and avoid emotional decisions based on short -term market variations.

• Use multiple indicators : Connect multiple indicators to strengthen trends and reduce risk.

• Maintain updated : Continue with news from the market, financial information and regulatory changes that can influence the market.

• Do not try to predict : technical analysis is not a glass ball; It is just a tool that will help you make conscious decisions.

conclusion

Technical analysis is an effective tool to identify market trends in the cryptocurrency and blockchain market.

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