From Personal Experience circa 2012 🥸
Welcome my fellow speculators and marvel at my insights 😮
- Forget using too many Technical Analysis (TA) Indicators and any attempt at a meaningful Fundamental Analysis (FA) in the cryptocurrency marketplace.
- The five key principles ‘Uncle Avi’ here sticks to (for time frames above 15 minutes) are:
a) Price follows volume. If the volume is rising then the price will most likely follow and vice versa. This is useful when we see a divergence- e.g., price increasing but volume reducing or the other way. If you use Bitcoin/USD as the primary indicator then this will allow you to gauge the overall way the whole market is headed.
b) Look for double tops and double bottoms or M’s and W’s which indicate rejection or support and therefore a potential fall or rise in prices.
c) The adoption of a Coin, Token and so on is more likely dependent on the ‘Social Presence’ the company has. I use coincheckup.com to analyse this. So, for example on this website if you choose Cardano (ADA), and click on the Analysis tab it shows you the communication channel, team strength, and product strength percentage values. Higher social media engagement has imho shown to be always a reliable indicator of ongoing and future success in the cryptocurrency market.
d) Use Stop Losses and Limit-Orders when you suspect you are in a Bull or Bear market. This will depend on your Risk Appetite, Capacity and Tolerance. It will also help you to maximise the gains, limit the losses and reduce emotion based trades.
e) Understand Cognitive Biases which affect the way you trade. To quote Michael B. Kitson- “Awareness is a key ingredient in success. If you have it, teach it, if you lack it, seek it.”
These simple steps have worked for me in the cryptocurrency market. However, the traditional markets require good FA, coupled with TA to find entry and exit points. But that is a story for another day 😌
Peace and Happy Speculating…🙃
