Hybrid Block: A New All-In-One Cryptocurrency Trading Ecosystem

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May 26, 2018 by
Hybrid Block: A New All-In-One Cryptocurrency Trading Ecosystem

3 Technical Indicators Every Cryptocurrency Trader Should Know

BaseTrade is aiming to be known as the Effortless Exchange for Asia, Europe and the Middle East.

Novice traders are typically overwhelmed by all of the different cryptocurrency exchanges available. The co-founders developed BaseTrade to simplify the trading process for beginners. Their goal is to help bridge the gap for inexperienced users to start investing in different cryptocurrencies.

HybridBlock is Providing an Educational Platform.

It is a gamified educational experience that teaches new cryptocurrency traders basic blockchain concepts and trading skills. Co-founder Apolo Anton Ohno believes that cryptocurrency education is crucial in gaining and retaining new investors in this space.

Technical Analysis is a popular strategy that is used by experienced cryptocurrency traders.

It forecasts future prices from the study of past price movements and trends. This article will show the basics of the art and science of Technical Analysis (7).

Technical analysis operates with 3 key underlying assumptions:

  1. The market discounts everything
  2. Prices move in trends
  3. History tends to repeat itself (2)

Technical Analysis uses charts to illustrate historical price data.

On basic cryptocurrency charts the price of the coin is shown over a certain period of time. The bottom of most charts also show daily trading activity symbolized with volume bars. There is an entire art on how to interpret technical indicators and patterns (1).

base trade

An understanding of chart patterns and technical indicators enable traders to execute a trade before a huge price movement occurs.

Here are 3 technical indicators that every cryptocurrency trader should know:

1) Simple Moving Average (SMA)

The Simple Moving Average (SMA) shows the historical price of a coin with a simple line. It is one of the most commonly used technical indicators. It simply shows the price trends of a coin, and it is useful to identify a trend in price (6).The typical time intervals used for the SMA are:

  • 10 days
  • 15 days
  • 50 days
  • 100 days
  • 200 days
cryptocurrency trading

****(this is a caption for above) The SMA illustrates a bearish price trend overall during Q1 in 2018 for Bitcoin (5).

2) Relative Strength Index (RSI)

The Relative Strength Index measures the momentum of a coin price. It measures the strength of directional price movements with both uptrends and downtrends.

The RSI assigns a value to a coin from 0 to 100

  • When the value is below 30 the coin is considered to be oversold
  • When the value is over 70 it’s typically considered to be overbought

If the value of the coin is at 50 there isn’t a trend in momentum

On March 29th, 2018, Litecoin’s RSI hit a low of approximately 26. The price of the coin also hit a low of approximately $112.00. In this particular case the coin was oversold and as a result proceeded to rise in both price and RSI value over the next few days (4).

litecoin trade

*Chart courtesy of tradingview.com (3)

3) Bollinger Bands

Bollinger Bands are a technical trading indicator created by John Bollinger in the early 1980s. They provide a relative definition of a price high and low for coins.

The coin prices are considered high at the upper band and low at the lower band. When the price falls outside of the Bollinger Bands this will typically indicate a developing new price trend.

  • Bollinger Bands are a set of three curves drawn in relation to recent coin prices.
  • The middle band is a measure of the intermediate-term trend
  • The intervals between the upper and lower bands and the middle band are determined by price volatility
  • The larger the band the higher the price volatility (3).

*http://tradingeveryday.com/price-channels-versus-bollinger-bands/ (9)

When Ethereum reached it’s record high in January of 2018, the price started trading outside of the Bollinger Bands on January 2nd and consistently did each day, with the exception of the two days preceding its all-time high on January 13th. Once the price hit the record high it began to fall in value and remained mostly within the bands (4).

cryptocurrency trading strategies*Chart courtesy of tradingview.com (3)

We’ll be sharing more posts like these on trading signals as we launch http://hybridblock.io, an exchange built to service all types of traders and their complex needs. Feel free to tweet to or follow @hybridblockhq on twitter.

Works Cited:

 1.) http://stockcharts.com/school/doku.php?id=chart_school:overview:technical_analysis

2.) https://realmoney.thestreet.com/articles/07/22/2017/how-technical-analysis-can-help-you-become-better-investor

3.)https://www.cryptocompare.com/exchanges/guides/how-to-trade-bitcoin-and-other-crypto-currencies-using-bollinger-bands/

4.)https://www.tradingview.com/chart/3155J1Ui/

 5.) https://www.nasdaq.com/article/bitcoin-btc-chart-bearish-rsquodeath-crossrsquo-may-soon-form-cm937301

6.) https://www.thebalance.com/simple-exponential-and-weighted-moving-averages-1031196

7.) https://www.investorsunderground.com/technical-analysis-lessons/

8.) http://best-binary-options-strategy.com/binary-options-trading-reversals/

9.) http://tradingeveryday.com/price-channels-versus-bollinger-bands/

Name Price
Bitcoin (BTC)
$5,425.85
Ethereum (ETH)
$162.71
Bitcoin Cash (BCH)
$270.76
XRP (XRP)
$0.298237
Litecoin (LTC)
$71.87
Cardano (ADA)
$0.069713
IOTA (MIOTA)
$0.283276
Dash (DASH)
$112.69
NEM (XEM)
$0.057725
Monero (XMR)
$65.16
Stellar (XLM)
$0.101756
EOS (EOS)
$4.66
TRON (TRX)
$0.023026
Bitcoin Gold (BTG)
$15.87
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