A great platform that allows traders access to the cryptocurrency market is Tradingview.com. This web based charting site is completely free. Head over to the site and search up the ticker symbol BTCUSD and select the Coinbase exchange. This is the ticker symbol for Bitcoin that?s currently trading in the Cryptocurrency market on Gdax. This is one of the crypto pairings that I trade. Below I am going to show you how to setup your charts like mine.
Once you arrive at Tradingview start by clicking on the timeframe and select 1 Day. This allows you to view the price action of the currency on a daily timeframe. Next we need to add some indicators. Select the indicators button and add in the Exponential Moving Average once and the Moving Average twice. We also need to setup the correct parameters which you can do by clicking on the gear symbol. Set the length of the Exponential Moving Average to 9, the 1st Moving Average to 20 and the 2nd Moving Average to 50. Next select different colors for each indicator so that they can easily be distinguished on your chart.
Moving Averages serves two very specific functions. The first function is to help you identify trends on particular timeframe. You have a short, intermediate, and long term time frame. The 50 Day MA signifies your long term trend. This trend is literally shown by the slope. If the slope is going up or down, it will reveal the trend on that timeframe. The 20 MA is the intermediate timeframe, while the 9 EMA is your short term. You can see from the 9EMA and the 20MA that Litecoin?s short and intermediate trend is down. But the longterm trend is still pointing up, showing the overall structure is still positive.
The second function of a moving average is to act as support and resistance. Support and resistance are areas that demand or supply can come into a currency. When you’re identifying support areas, there can be potential demand that comes into the currency around those price levels. These levels can be areas that push the currency up or pull it down.
On the right side of the platform you can see a generic watchlist. You?re free to customize this list so that you as a trader can have the best pairings on hand. Type in ETHUSD as well as LTCUSD in the search bar and select the symbol in the Coinbase exchange. These are the ticker symbols for Ethereum and Litecoin. These two along with bitcoin are the three main cryptocurrencies that provide the best opportunities for traders right now.
Enter some of these symbols in and you can see why cryptocurrencies are so hot right now. It?s mainly the enormous trend that these currencies have put in recently. Enter the symbols and you can now clearly see the momentum in the price action. Starting in May, bitcoin has gone on a move that generated a 300% return. Ethereum, the one I trade the most is currently in a short term downtrend but long term uptrend. Finally, Litecoin is the most interesting stock as you can see it continue its upward trend.
Here is a video that describes everything I just talked about plus more.
Kunal Desai is an American day trader (stocks and cryptos) and founder of Bulls on Wall Street and Bulls on Crypto Street, two online trading academies and informational publications. He has been featured in many high profile publications like Inc, Forbes, Buzzfeed, and Fortune. He has spoke at trading and business events all across the World.