These are what we find are the best foundations for begginer traders to master.
Support & Resistance
Support occurs when a downtrend is expected to pause due to a concentration of demand. Resistance occurs when an uptrend is expected to remain temporarily due to a concentration of supply. This should be the first thing you learn and understand.
The relative strength index is a momentum indicator used in T/A. RSI measures the speed and magnitude of and asset's recent price changes to evaluate overbought or oversold conditions in the price of that asset. The RSI is an oscillator on a scale of zero to 100 as depicted on a line graph
The relative strength index is a momentum indicator used in T/A. RSI measures the speed and magnitude of and asset's recent price changes to evaluate overbought or oversold conditions in the price of that asset. The RSI is an oscillator on a scale of zero to 100 as depicted on a line graph
Moving Average Convergence Divergence (MACD)
The MACD is one of the easiest and most effective momentum indicators available. The MACD uses two trend-following indicators, moving averages, into a momentum oscillator. This mathematical equation subtracts the longer moving average from the shorter one. This calculation results in the MACD offing the best of both worlds: trend following and momentum. The MACD fluctuates above and below the zero line as the moving averages converge, cross and diverge. Traders can scout for signal line crossovers, centerline crossovers, and divergences to generate signals. Because there are no upper or lower limits on the MACD, it is not helpful in identifying overbought or oversold conditions but serves better to spot momentum changes
The MACD is one of the easiest and most effective momentum indicators available. The MACD uses two trend-following indicators, moving averages, into a momentum oscillator. This mathematical equation subtracts the longer moving average from the shorter one. This calculation results in the MACD offing the best of both worlds: trend following and momentum. The MACD fluctuates above and below the zero line as the moving averages converge, cross and diverge. Traders can scout for signal line crossovers, centerline crossovers, and divergences to generate signals. Because there are no upper or lower limits on the MACD, it is not helpful in identifying overbought or oversold conditions but serves better to spot momentum changes
“Risk comes from not knowing what you’re doing.”
-Warren Buffet
Fibonacci
Fibonacci was an Italian mathematician who came up with the Fibonacci numbers. They are popular with technical analysts who trade the crypto and financial markets since they can be used in any time frame. The most popular kinds of Fibonacci levels are retracement and extension levels. Fibonacci retracement levels indicate levels to which the price could retrace before continuing the trend. It's a simple division of the vertical distance between a significant low and a significant high (or vice versa) into sections based on the critical ratios of 23.5%, 38.2%, 50%, and 61.8%.
Price tends to come back to these levels before continuing the primary trend. Fibonacci extension levels show levels that the price could reach after an initial swing and retracement. TradingView has an innovative drawing tool for Fibonacci retracements and extensions, allowing users to identify these levels on a chart visually. Both tools are fully customizable, and levels can be changed or added
Fibonacci was an Italian mathematician who came up with the Fibonacci numbers. They are popular with technical analysts who trade the crypto and financial markets since they can be used in any time frame. The most popular kinds of Fibonacci levels are retracement and extension levels. Fibonacci retracement levels indicate levels to which the price could retrace before continuing the trend. It's a simple division of the vertical distance between a significant low and a significant high (or vice versa) into sections based on the critical ratios of 23.5%, 38.2%, 50%, and 61.8%.
Price tends to come back to these levels before continuing the primary trend. Fibonacci extension levels show levels that the price could reach after an initial swing and retracement. TradingView has an innovative drawing tool for Fibonacci retracements and extensions, allowing users to identify these levels on a chart visually. Both tools are fully customizable, and levels can be changed or added
Moving Averages
Moving averages take the average price for any set period. For example, if you use a 50-point moving average, you can look at it at any period you need. You could use the 50-point moving average for the hour, 4 hour, day, week, month, and so on.
Moving averages smooth out price action filtering the noise from short-term price volatility. Traders use moving averages to identify trends and can act as support and resistance. You can combine multiple moving averages, and their crossovers may signal trade opportunities for traders.
The most common moving averages include the 50-point, 100-point, and 200-point. In 2018 the 20-week moving average showed significant returns and caught many traders' attention. Until the 2022 bear market, the 200-week moving average proved strong support.
Moving averages take the average price for any set period. For example, if you use a 50-point moving average, you can look at it at any period you need. You could use the 50-point moving average for the hour, 4 hour, day, week, month, and so on.
Moving averages smooth out price action filtering the noise from short-term price volatility. Traders use moving averages to identify trends and can act as support and resistance. You can combine multiple moving averages, and their crossovers may signal trade opportunities for traders.
The most common moving averages include the 50-point, 100-point, and 200-point. In 2018 the 20-week moving average showed significant returns and caught many traders' attention. Until the 2022 bear market, the 200-week moving average proved strong support.
Strategy
New traders' biggest mistake is not having a proven, back-tested strategy. Without a strategy, the odds of you becoming a successful trader are little to none. Everyone thinks they are a genius when prices are bullish; when prices start to trend bearish, people start to panic. That is where having a strategy saves you money and stress.
Without a strategy, we highly recommend people not try and trade. The tie between emotions and money is strong, and there have been many sad cases where people have ruined or ended their lives.
New traders' biggest mistake is not having a proven, back-tested strategy. Without a strategy, the odds of you becoming a successful trader are little to none. Everyone thinks they are a genius when prices are bullish; when prices start to trend bearish, people start to panic. That is where having a strategy saves you money and stress.
Without a strategy, we highly recommend people not try and trade. The tie between emotions and money is strong, and there have been many sad cases where people have ruined or ended their lives.
