Cryptocurrency is one of the most lucrative investments you can make today. However, to make money, you have to be a good trader. Now, the most crucial tool for any crypto trader is crypto charts. These charts contain all the present and historical information a trader needs about a particular crypto coin or token.
However, charts can be intimidating. The plot lines, waves, and different colored patterns can make you feel like you need Wall Street expertise to understand them.
The truth is it takes time to understand crypto charts comprehensively. But that doesn’t mean unseasoned traders cannot use crypto charts to make better trades. So, here are for essential tips to help you read crypto charts, including the Exeedme Chart, one of the hottest cryptos today, properly the next time you want to trade:
1. Understand the Most Common Types of Charts
The most common crypto charts are line and candlestick charts. In all three, the x-axis represents time while the y-axis represents the crypto coin’s price. With line charts, you can trace the price movement over time by following the up-and-down movement of the line.
With candlestick charts, you get vertical bars in red and green. Each candlestick shows three things, the open price and close price, indicated by the body, and the high price and low price, shown by the wicks, within one unit of time, for instance, 30 minutes.
Essentially, a green candlestick means that the coin/ token closed at a higher price than it opened, while a red one means it closed at a lower price than it opened.
2. Spot an Uptrend or Downtrend on Candlestick Charts
Once you know what candlesticks mean, you can easily spot bullish (upward) and bearish (downward) patterns. One way to do this is by using the head and shoulders approach.
Typically, this pattern appears as three peaks or valleys, with the peaks being the ‘head’ and the valleys the ‘shoulders.’ A higher head with two low shoulders on either side indicates a bearish trend and could mean the price is about to go down. On the other hand, an inverted head and shoulders pattern suggests a bullish trend and may indicate the price will go up.
3. Pay Attention to Support and Resistance
On the one hand, support refers to a price point at which purchasing pressure is expected to be strong enough to deter further price decline. On the other hand, resistance is a price level where the selling pressure may hinder further price appreciation. Understanding these two levels can help you know when to enter or exit a trade. Besides, it allows you to assess market sentiment and potential price reversals.
4. Consider Other Important Indicators
Many crypto charts also come with indicators that help you better predict the future possibilities of a coin or token. Of these indicators, the most important include:
- Volume indicators: shows the market activity level and, consequently, can predict whether the price will go up or down.
- Volatility indicators: shows a coin’s movement relative to its mean price. Low volatility means more predictable price swings and vice versa.
- Momentum indicators: tells you whether a coin is overbought or oversold.
Use These Tips to Read Exeedme Chart & Improve Your Trading Skills
Crypto charts remove the guessing out of trading. So, knowing how to read them can improve your trades and, consequently, profits. Exeedme (XED), native to Exceedme competitive gaming platform, is a good example of a token that is doing reasonably well in the market today you can apply the above tips. A
ll in all, remember to do your own research and due diligence when trading.