In market analysis, the development of your own trading practices may be different from successful trading or economic pain.
Businesses use different indicators to add accurate results to gain layers of confirmation. But what if you could choose only one indicator used in the cryptocurrency market, what would it be and why?
A recent poll by CoinDesk Markets revealed that volume was a 39 percent choice, while the RSI came second to 29 percent of the vote.
The survey raised some great answers to alternatives such as Elliott’s wave theory, differences and stochastic oscillators that are usable, but which are heavily dependent on the individual’s technical chart and experience.
We found out some significant cryptocurrency merchants and charters to see what they considered as one of the indicators they couldn’t live without.
Matt Thompson, Director of Business Development and Operations at Coinigy, said this by saying that he said in his analysis of the crypt market: “Volume is by hand regardless of the most important prices.”
“For many other technical indicators, volume may also serve as a confirmation or rejection of a particular hypothesis,” he continued.
By definition, the amount is intended to represent the total number of shares or contracts over a given period and is usually expressed in a bar chart. Professionals and charters use the volume to a great advantage when the mantra is monitored, that if the price drops with volume, it usually means a clearing point, which means a cancellation soon.
On the other hand, the rise in prices as a result of the decrease in total volume means that bears will be stronger when they pull prices down to a lower bid, usually when the key zone is full.
Crypto Twitter Chartist Josh Rager agrees. “I think volume is a good indicator. Higher prices and low volumes usually lead to lower prices, he said.
“TheCryptoDog”, a significant Twitter personality and Chartist, also supported the volume as a “crucial” element in his technical analysis, telling CoinDesk:
“Volume talks about the sincerity of price actions. Volume for me is essential. “