Blockchain and Cryptocurrency Basics - About Crypto Trading and Analysis - 2/2

Fundamental analysis

Fundamental analysis is a very common tool that is used in cryptocurrency trading. Fundamental analysis has proven to be one of the most effective tools when it comes to trading any cryptocurrency asset. When using fundamental analysis in trading, the trader pays close attention to the project, the trader analyses the cryptocurrency volume and liquidity, team behind the project, what the cryptocurrency project is trying to solve in the industry, the number of good exchanges that it is listed, the news surrounding the project, partnerships, the cryptocurrency market capitalization, circulating supply of the cryptocurrency, total and max supply of the cryptocurrency and more. All these would help the trader to make better trading decisions. A cryptocurrency with a good fundamentals is good for trading because it means that the cryptocurrency has a high chance of increasing in price. Example of a good fundamental analysis is the listing on top exchanges.

Tweet - Coinbase list STORJ

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Tweet - Binance to list GYEN

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Technical analysis

Technical analysis is also a very common tool that is used in cryptocurrency trading. Technical analysis is basically is tool that is mostly used in trading for price forecasting and to determine the best entry and exit points so as to make the most profits. When it comes to technical analysis, traders look at price charts and make use of different technical tools and indicators to forecast price movements in the cryptocurrency market. When using technical analysis in trading, indicators such as RSI, MACD, volume, moving averages, to help determine the market trend. Technical analysis helps to determine support and resistance levels which helps traders know where and when to enter and exit a trade, and also helps trader know where to set stoploss. This type of analysis is very popular and common when it comes to trading any cryptocurrency asset.

Higher High and Lower Low indicator on the ENJ/USDT chart

RSI indicator on the DOT/USDT chart

MACD indicator on the BNB/USDT chart

Conclusion

Trading is one of the major aspects in the cryptocurrency market and when it comes to earning and making profits in cryptocurrency. Trading is basically the act of buying and selling of any cryptocurrency asset. When it comes to trading any cryptocurrency assets, exchanges play a very important role in enabling users, buy and sell cryptocurrency assets of their choice. When it comes to trading cryptocurrency assets, fundamental analysis and technical analysis are very important tools used for trading so as to make the most profit. The goal of every cryptocurrency trader is to make profit which means that the trader aims to make accurate forecasting so as to buy low and sell at a higher price.