Crypto Chart Reading Basics – How to Get Started Trading on Crypto Exchanges like Bittrex
Trading cryptocurrency on charts is a mistake! Yes, you heard that right. Without the order book information I will discuss on this video, as well as other important basics, reading charts to trade on crypto exchanges like Bittrex becomes a waste of time AND money!
Installation of Chrome Extension for Enhanced Charts
Before diving into some of basic information that’s essential to trade on cryptocurrency exchanges (specifically Bittrex for this video) and looking at examples with Bitcoin, Ethereum and Litecoin, you should download the Bittrex Enhanced Chrome extension (URL at bottom of description). The enhanced Tradingview charting tools that the extension provides are far more useful than the overly simplistic set provided by Bittrex. The resulting color coded bars and candles make the charts much easier for beginners to interpret and understand.
Common Mistake Beginners Make When Trading Cryptos
One of the biggest and most common mistakes made made by new crypto traders is taking the prices on charts literally. If you learn something from this tutorial, learn this: DO NOT TRADE PURELY OFF THE CHARTS!
So what price source should you be trading off? Pure and simple, the order book.
Bitcoin, the Order Book and Trade Volume
The first charting example that we use to drive this point home on the video is Bitcoin (BTC). After introducing what the Bid and Ask prices for Bitcoin are on the trading platform, I take a look at the order book and analyze the moving buy and sell orders on it and how much more accurate your trades will become by focusing the book for your trade prices. In addition to using order book instead of charts to trade, we also touch upon the concept of trade volume and its relationship with market orders as well as it’s importance.
Ethereum Bar Chart Example
The key element when it comes to cryptocurrency charts is the bar. On the second example, I focus on the major coin Ethereum (ETH). The opening, closing, high and low prices during a given period of time (the 15-minute timeframe was used on the video) make up each bar on the chart.
Litecoin Chart – Understanding Candlesticks
The third and last examples introduces a candlestick chart. Even though the candlestick charts have the same extreme and opening/closing values as a regular bar chart, it introduces the body of the candle, which is visually a lot more intuitive than basic charts.
Conclusion of Basic Chart Reading Video
Once you understand the concepts of using the order book and analyzing the volume information, you can go ahead and start practicing with charts, which is the initial ingredient that most newbie crypto traders give the majority of their attention to.
Even though this is a very basic startup video, stay tuned for more advanced trading and strategy videos over the coming weeks, which will help you grow your cryptocurrency trading toolset.
Please share this video with a friend who is learning how to trade or wants to become a better trader, download the Bittrex Enhanced extension for more advanced charting below, and follow us on Instagram and Facebook:
Bittrex Enhanced (Tradingview Charts): https://goo.gl/QMKnzw
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