Why Is This The Bubble Of The Year?
One of the most intriguing questions when discussing the recent rise of the Bitcoin price is whether or not this is a long term strategy or if we can expect it to end at some point. I believe that the answer lies in how it can be considered a bubble. Many investors and traders in the past have seen price action as a way of determining whether or not an investment is a good buy or a bad one, but in the case of the currency, it is quite clear that price has been consistently overvalued and undervalued in its brief existence.Click here for more details about cotizacion bitcoin
There are several major technical indicators that we can use as a way of analyzing the strength and direction of the price, but the two most prominent include the MACD and RSI. If you want to understand why these two indicators are so important to the success of your trading decisions, read on.
First, the MACD or Moving Average Convergence Divergence indicator will show you the strength and direction of the moving average, which is basically a line drawn from the current price of the currency to the historical average. This is an excellent way of showing the strength and consistency of the trend, but more importantly, it shows us where it is headed. If the trend is going down, the line will begin to lower, and vice versa.
Second, the RSI (Relative Strength Index) can show us the strength and consistency of the market. When it moves up, the line will move up, while when it moves down, the line will move down.
These are just two of the many technical indicators that are available for us to use as a means of understanding why these large changes in the price of a currency occur so often. There are other indicators that are extremely useful, however, they are generally much less reliable when it comes to predicting future market direction. However, by using them, we can be able to see whether or not the current price of the currency is being influenced by underlying economic factors, such as inflation, or whether it is simply a sign of investors' excitement about the new currency.
When using price action to determine whether or not a certain currency is a good buy or a bad one, it is important to keep in mind that there is no real indicator that can tell us if it will stay high or low for the rest of its life. The only thing that we can look for is the strength and consistency of the trend, which is often displayed as a line with a moving average crossing it.
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