We are all aware that it’s a new year, which means there are new trends creeping up on us all, even the Best Cryptocurrency Exchange Platforms have a guide of their own.
New trends can be complex and need a bit of understanding, and that’s okay. We have you covered. By the time you’ve reached the bottom of this page, you’ll be able to refer to yourself as a cryptocurrency price trend guru.
What many have a hard time grasping is that there are processes that have to take place to understand and analyze the crypto market.
We’re not blaming you though, it’s difficult to analyze, even yet understand a multi-billion dollar market. It begins with the crypto market’s cycles.
The delay is keeping track of the psychology of crypto market cycles and the way they behave—especially for traders, graphs are like gold, helping them to affirm their choices in buying and selling—which is why analysis techniques are the methods used to make the process less strenuous.
The Process, or Processes
There are 2 price analyzing methods one can use to predict trends. They are technical and fundamental
Using this method, as a trader, you’ll have to create your own projections of price shifts, and there are plenty of tools available to do that. The great thing about this method is that it’s easily accessible.
You don’t need to have a background in production or transfers of wealth. However, there are a few things to know about the technical analysis chart:
- Prices will point different directions once they take place over a specific period.
- Price fluctuations are inevitable and will most likely repeat each other because history tends to repeat itself.
Majority of traders prefer this method due to its tools, its simplicity, and theories. This is a big asset to traders, as it helps them narrow down entry points.
With this method, as a trader, you may not need to spend time on developing new ways to carry out specific tasks to understand all other markets.
The second way to predict cryptocurrencies’ price shifts is known as the quotes’ prediction. Unlike the technical method, it’s fundamental, meaning there’s a variety of skills necessary because it’s based on political and economic occurrences and companies’ figures.
This method focuses on project research and technology in regards to coins in the crypto market.
A trader wants to know if a coin is going to hold its value, and that can only be done by having knowledge about the industry and understanding how different occurrences can drastically change prices.
The crypto market is extremely pliable, which means it’s not beneficial to focus on a single reason for a shift for extensive amounts of time. So, take these things into consideration:
- Usually it’s easier to give explanations for price fluctuations through detailed research, and to predict future prices, or assets, it is essential to know the impacts that cause price fluctuations.
- The statement above is true for other markets, but there are differences between other markets and the cryptocurrency market—cryptocurrency markets have alike characteristics of stocks and currencies.
- It is important to grasp that the crypto industry is a decentralized market, meaning there isn’t a higher power of regulation, and unlike the technical method, physicality doesn’t exist with the fundamental method.
- The main difference is that there is no chart, just research conducted from events in order to trade.
CoinDiligent Staff Writer