blog posts

Review Of Technical Analysis And Three Ways To Make Money In The Field Of Digital Currencies!

When it comes to price forecasting, we see a variety of forecasts: one sees a price of $ 900 for Bitcoin, and another says $ 100,000 in the not-too-distant future. 

In this article, we examine the world of digital currency signals and technical analysis in this area.

The most important reason people join Telegram virtual currency groups is that they are looking for a way to make a profit. One of the most prominent things most people expect in these groups is the signal.

In the business world in general, a signal is a message in which people are offered to buy or sell an asset (digital or traditional) based on their analysis. But can all these signals be trusted?

Structure of a signal

Click on the image to see the full size

In principle, when the analyst is confident enough of his analysis, he publishes it in the group to the members. There is information in each signal, the most important of which are discussed below:

The buy range: Indicates the appropriate range and levels for buying or selling.

Sell ​​targets: The level or levels that the analyst suggests, if the asset price reaches it, the profit is made and to avoid potential risks at the time of sale.

Stop Loss: The level that if the price reaches, the sale should be done to prevent further losses. This can be set up automatically on exchange platforms.

The above three are enough to generate a signal. Writing a signal is simple, but it is the accuracy of this information and the expertise of the analyst that makes a signal valid or invalid.

Most digital currency signals, especially for short-term trading, are provided through technical analysis or abbreviated analysis (TA).

Technical Analysis is a method of forecasting PricesIn the market by studying the past situation of the market. In this analysis, the situation of prices in the future can be predicted by examining changes and fluctuations in prices and trading volume and supply and demand.

In technical analysis, everything is included in the price, and an analyst does not need anything other than mathematical data and graphs. This analysis was first used in the traditional currency and commodity exchanges and was used by most experienced brokers. But the open space of digital currency trading has made this analysis much more useful and trendy.

In general, technical analysis is the answer to this question:  based on recent price patterns and market history, what do you think is the next step for investors and where will the market go?

The effectiveness of technical analysis in digital currencies

Investigating the Opportunities and Risks of the Digital Currency Market in the Report of the Iranian Economic Outlook Conference in 1997

Technical analysis has special power in the digital currency market due to several factors. We know that digital currency markets can be very profitable as well as unprofitable. In this space from veteran stock market shareholders to newcomersBitcoinThere are heard. Given the fledgling market and the lack of regulation and full awareness in this space, the slightest news can play a key role in increasing or decreasing prices.

Also, at the time of writing, the total market value of digital currencies is below $ 500 billion. Apart from this, the trading volume of some digital assets is so small that even with a few orders of $ 10,000, there are significant changes in its price. In other words, the current market is strongly influenced by the behavior of buyers and sellers.

On the other hand, many trading robots these days operate in exchanges and trading platforms using technical analysis or specific strategies. These robots are available in two types, general and custom. Public or free robots are not very powerful and reliable. The existence of these robots also shows that it has imposed its own technical analysis on traders.

Limitations of technical analysis

Review of technical analysis and three ways to make money in the field of digital currencies!

In  while  technical analysis  to greatly help suppliers  is to remember that there are many shortcomings in the technical analysts. The other from the  fact that technical analysis is not a guarantee of success and a lot of people who consider themselves analyst, not an expert, one of the  limitations  is that  all things  in quotes. In fact,  because one does not know the future and what lies ahead, most analysts Analysis  to as an example  only say:          

If the price goes above the x level, the price is very likely to rise to the y level.

Bad news  may be  the severity of  the price of  a  currency,  especially  digital  effects of  the transition will be. Therefore, with technical analysis, your risk is very high. For bad news and to prevent further losses, there is  only one way for most  regular  traders , and  that is to  determine the Stop Loss.   

According to Investopedia,  the  hypothesis that  decomposition and analysis,  technical it is based,  are  as follows:  

1- The hypothesis that is included in the price of all important issues. This means that the price of  an  asset at  any given time includes all available information and therefore represents the fair value of  an  asset among traders. It states that an object assumes that market prices always  reflect a  total knowledge of all  Company  Participants  in the market.

According  to the  above quote , even the best technical analyst can only   examine what business patterns will occur given the current situation. 

2- There is no buying and selling in the random market and there must be a reason. Therefore, according to this hypothesis, it is always possible to identify market trends and profitability for traders. According to this hypothesis, even emotional sales do not mean that they are unreasonable.

Three special points

Review of technical analysis and three ways to make money in the field of digital currencies!

Jander, one of the leading trading view traders, has these three special points for you:

1. Always set a stop loss for yourself – Execute your stop loss correctly. Man is greedy, even when we reach our sales goals, a voice inside us always says wait, maybe you will make more profit. But most of the time we lose more.

2- Respect the time. Sometimes it takes a long time to reach a signal; Always wait and do not push the trigger too fast, especially if you do not stop hurting yourself. Even short-term signals may take several days to cross the resistance line.

3. Do not put all your eggs in one basket. Digital currencies are a very volatile market, and putting all the eggs in one basket only exacerbates the risk. Always be researching and try to minimize your risk. Remember that you are alone and the market is very cruel.

Do we have to trust the signals?

It can be said that more than 70% of the signals shared in the signal groups or sites are not valid. A good trader does not ask anyone for fish, but learns to fish. There are many resources for learning technical analysis. It is enough to have the will and practice. Even if you use valid ready-made signals, familiarity with technical analysis will help you to better understand that signal.

The three ways of wealth

Review of technical analysis and three ways to make money in the field of digital currencies!

One of the leading market analysts, Kenny Lee, has introduced three ways that can make you rich. One of them or if you can try all three ways. Of course, as long as you really believe in the future of digital currencies!

Warning: Please note that we do not offer you to invest and buy digital currencies in any way, and this section is only quoted by Kenny Lee, an analyst.

Long Term Investment

Here’s how it works: Buy some digital currency and forget about it for at least a year! Choose one or more currencies that you think have a very bright future. Buy a reasonable amount of money (if you lose it, your lifestyle will not be disrupted.) And save it in safe wallets (never exchanges). Under no circumstances should you sell them for at least a year or two. Do not listen to any news or suggestions and only think about keeping them.


Medium term investment

Consider digital currencies that are almost cheap and you are not sure about their future in the long run, but you are likely to see good price growth in the medium term (6 months to 2 years). For example, we can mention Ripple, which had a very good growth at some point and can repeat this growth again. Or, for example, Bainance Quinn has grown very well so far and its price growth is not far from the mind for the next 6 months. If you choose this path, consider less than reasonable capital (money that if you lose, your life routine will not be disrupted).

Daily trading

This path is extremely risky, but it can be a rewarding job for you. Unlike the previous two ways, your dollar capital is important here, not the number of digital currency units you have.


I emphasize again that the risk of this path is very high, so if you are going to start with much less capital than reasonable capital (money that if you lose, your life routine will not be disrupted) so that you are not afraid of making mistakes and become a good professional.

This road requires a lot of effort, practice and research, but if you reach your destination, you will get rid of the fatigue of the road.