Reading of candlestick lists: a guide for beginners for cryptocurrency trade
Cryptocurrencies, such as Bitcoin and Ethereum, have become increasingly popular in recent years. However, navigating the complex world of cryptocurrency trade can be overwhelming even for experienced investors. A tool that has proven to be a valuable resource for merchants are candle graphics. In this article, we will explore how to read the candle graphics and use them to obtain information on cryptocurrency price movements.
What are candelabra?
The candle graphics are a type of graphic tool used in the technical analysis to visualize the price movements over time. Each candle represents the opening and closing prices for a particular period of time, as well as any open interest (the number of outstanding units). The size and color of each candle indicate the magnitude of the price movement.
Types of candlesticks
There are several types of candlesticks, but these are some of the most common:
* Hammer pendant
: A candle that is formed when the closing price is lower than the opening price.
* Hammer inverted : A candle that is formed when the closing price is higher than the opening price.
* DOJI : A candle that forms a small body with a long tail, indicating indecision or lack of conviction in the market.
* START STAR : A candle that is formed at the end of a bearish trend, indicating a possible investment.
Reading the candle lists
To read the candle graphs effectively, it is essential to understand the following:
- Open and closed prices : These two prices represent the opening and closing values for each day.
- Candle body : The body of the candle represents the price movement over time.
- Wick lengths : The length of the wicks on each side of the candle represents the magnitude of the price movement.
Interpretation of candle patterns
Here are some common candlestick patterns and their interpretations:
* Candle pattern 1 (hammer) : A strong rising trend with a small body.
* Pattern of candles 2 (inverted hammer)
: a strong downward trend with a small body.
* Candle pattern 3 (DOJI) : A balanced market without a clear tendency direction.
* Candelabro pattern 4 (shooting star) : A bassist trend with a weak or little convincing investment.
Use of candle graphics to identify patterns
Here are some ways to use candle graphics to identify patterns and predict price movements:
- Look for investment patterns : When the price forms an investment pattern, such as a hammer, inverted hammer, doji or fleeting star, can indicate a potential change in the trend.
- Identify trend changes : candlesticks can help you determine when buying or selling according to changes in the trend.
- Use candle patterns to confirm the signals of the graph : Many graphics signals, such as outbreaks and reversions, require confirmation of candle patterns.
Tips for reading candles graphics
- Practice, practice, practice : The more you practice reading candle graphics, the better you will be to interpret them.
- Focus on the body of the candle : The body of the candle is often the most important part of the graph, since it represents the price movement over time.
- Use multiple deadlines : Read candle graphics requires understanding multiple deadlines, such as short and long term trends.
Conclusion
Candle graphics are a powerful tool for merchants to analyze cryptocurrency markets. When learning to read and interpret these graphics effectively, you can obtain information on cryptocurrency price movements and make more informed commercial decisions. Remember, candle patterns can be used to identify reversion points, confirm the signals of the graph and predict trend changes.