Market analysis.
I will explain the topic simply and clearly even if you don't have a previous background:
First: Types of analysis in the Bitcoin and cryptocurrency market
There are 3 main types of analysis:
Type of analysis meaning
Technical Analysis: Study of price movement and charts to know future price direction
Fundamental Analysis: Study of news and information affecting the currency and its intrinsic value
Sentiment Analysis: Monitoring the behavior and thoughts of investors in the market (fear and greed)
Second: We explain each type in detail
Technical analysis (most used in trading)
Depends on reading candlestick patterns on charts.
Uses tools such as:
Support and resistance lines.
Technical indicators such as:
RSI (Relative Strength Index)
MACD
Moving Averages
Trading volume
The idea of technical analysis:
History repeats itself.
Price movement reflects traders' emotions.
Trends can be predicted through patterns and previous data.
Quick example:
When Bitcoin price reaches a strong support area several times, it may bounce back and rise.
When breaking a strong resistance, it may continue to rise.
Fundamental analysis
Depends on:
Market news (like the U.S. Federal Reserve's interest rate decisions).
Legislation and laws related to crypto.
Entry of major companies into the market.
Adoption of Bitcoin by countries or institutions.
Amount of Bitcoin available in the market (supply and demand).
Example:
If a company like Tesla announces buying Bitcoin → the price may rise.
If a country announces a ban on trading cryptocurrencies → the price may drop.
3️⃣ Sentiment Analysis
Depends on:
Following breaking news.
Reading Fear and Greed Indicators (Crypto Fear & Greed Index).
Follow social media and communities like Twitter, Reddit, Telegram.
General level of excitement or anxiety in the market.
Example:
If people feel extreme fear → it may be a good time to buy.
If everyone is greedy and overly excited → there might be a bubble close to bursting.
Third: Tools to help you in analysis
Tool Function
TradingView to view and analyze charts
CoinMarketCap to track prices and essential news
Glassnode for on-chain data analysis
Crypto Fear & Greed Index to understand the psychological state of the market
Fourth: A golden tip for beginners 👇
Do not rely on just one type of analysis.
Combine technical, fundamental, and sentiment analysis.
Do not enter trades without a clear plan.
Always set a stop loss.
