The core purpose of creating this course is to make a free cryptocurrency trading course that’s better than the courses that people sell for thousands of dollars. This cryptocurrency trading course covers a lot for a complete beginner to go all the way up to an intermediate level.
Things covered in this course;
• The x and y axis
• Time frame analysis
• The constant war between buyers and sellers
• Cryptocurrency trading pairs
• Order types
• The best assets to trade.
First off, choosing the right broker is one of the most important steps in becoming a profitable trader because a lot of the times brokers can be scammers or they can actually take a large percentage of your money by requesting for outrageous fees. Here are few tips to know when looking for a broker;
• They have low fees
• They have a variety of different tradable assets
• They already have a large number of customers
• They have great customer service ideally and that they have live chat support.
• You have to make sure that it has an easy interface to use.
There are a lot of brokers that you could use out there so take your time and make your research before selecting a suitable broker.
The X and Y axis
When looking at a chart there are a few things you should notice, on the y-axis there’s price and on the x-axis there’s time. The time frame can be changed and as the time changes, the date and where the price has been at also changes.
On the chart you’ll see these little things called candles, basically the top ends or the bottom ends are called the wicks of the candle and then the center area is called the body of the candle and each of these candles represents a period of time. For example, in the daily chart, each one of the candles actually represents one day. The candles are made up of four different parts; the low, the high, the open, and the close. Essentially the low is the lowest that the candle has gone or the price has gone. For instance, in a one day time period, the high is the very highest that the candle or the price has gone during this one day period; the open is the price the session actually opened at when the day actually started; then the close is the closing price at the end of the day.
If a session opened and closed and it printed a green candle which is called a bullish candle, it basically means that there was more buyers in the market than sellers. On the opposite side we have bearish candles which are represented by red. It means that at the start of the day, the price was higher and at the close of the day, the price was lower. It is represented by a bearish candle or a downward candle. Simply, the words bullish means price is moving upwards or bearish means price is heading downwards.
In the daily candlestick which we have the open, the close, the low and the high of the candle but also if you break that down into the four hour time frame you will notice that there will be six candles in total where each one of the candles represents four hours because six times four equals 24 hours in a day.
There are a lot of Japanese candlestick patterns and each of these patterns have a different psychology and mean something different. When there’s a red candle and a very big green candle right next to it and completely engulfs the red candle, it is called a bullish engulfing candle and generally when you see this price generally heads upwards. The reverse is a bearish engulfing candle. When the big red body that’s engulfed in the previous one is rather engulfing the green candle, this would be a bearish engulfing candle. Another candlestick pattern to pay attention to is called pin bars. And the pin bar basically has a smaller body and a long wick. This is telling us psychologically that the price tried to go down lower but it didn’t happen and the price actually ended up going up. This means that the bears tried to win and they went all the way down but the bulls came back and they fought it all the way up. This is generally a likely scenario where price is going to continue on upwards. This candlestick pattern can occur in the opposite direction.
The constant battle between buyers and sellers
There’s a constant battle between buyers and sellers and anytime that you’re buying a cryptocurrency that means that there’s somebody on the market that’s actually selling you this cryptocurrency or anytime you’re selling and you’re able to actually sell that means there has to be a buyer on the other end. So there’s always this constant battle of buying and selling that’s happening in the market and that’s really what the charts end up making up and that’s what these candles make up. it shows the psychology of what’s happening in the market between buyers and sellers. The battle between the buyers and sellers is what actually gets price to move.
You’ll notice that whenever you’re trading an asset you’re trading it against some other asset. For instance, there’s btc/usd and in this case the first one is called the base currency and then the second one is called the quote currency so the base currency is bitcoin the quote currency is the us dollar. You’ll also notice that it’s always traded in pairs and where there’s ETH/USD, the ethereum in this case is the base while the us dollar is the quote currency. Since you’re trading a pair you have to trade one asset for another asset, if the price is going up and you would want to buy ETH/USD, you’ll buy ethereum because you think that ethereum will go up in price relative to the us dollar.
When you want to actually place your trade, to buy bitcoin or to sell ethereum, there are different types of orders that you can make in order to execute it.
A. market orders
B. take profit
C. stop loss
D. trailing stop losses
E. buy and sell stops
F. limit orders
A. In market order, you can either buy or sell at the market price so this means that you will enter the trade at the best market price that’s available at the moment.
B. In take profit you basically place a market order to buy and when price reaches the target, you sell the asset and then take the profit. You can set this order on the brokerage that you’re trading in a way that when price hits the target you automatically take profit. This works in the opposite direction too when you want to take a sell order. You get into the market when the market price is available and you put the take profit down below if you are expecting price to go lower so that when price comes down and hits your target then you will be taken out of the trade and you will earn profit.
C. Stop loss is essentially when you want to sell at the market price and once the price gets to the target, you take your profit. Adding a stop loss essentially means that if the price goes against you and you’re losing money, and you want to get completely out of the market at this stage, once the price gets to the target and it hits a lower price then you’ll get taken out so that way you cut your losses lower. Also in the opposite direction, you place a buy order, you put your take profit, put your stop loss to protect your bottom downside. If price comes up and it hits your take profit and later if price were to come down to hit your stop loss, you’d get taken out of the market.
D. Trailing stop loss is a little bit more advanced but putting it simply, you place a buy order and when that price moves on up you can move your stop loss or trail your stop loss. By this way you’ll be locking in profits and also limiting your downside.
E. In Stop orders, you enter the market as soon as price gets up. When you place a stop order and as soon as the price comes up and hits the target line then you’d automatically enter the trade.
F. The limit order consists of the buy limit and the sell limit. In the buy limit, during a trade and you want to wait for the price to come down before you actually enter your order. Once it comes down and it starts coming back up you’d enter the trade. While in a sell limit, during trading and you think that the price is going to come up before falling, then you place a sell limit. After the price has gone up and come down, you’d enter the trade.
The best assets to trade
When trading cryptocurrencies, make sure that you’re trading the best assets. There are like 10,000 different cryptocurrencies and sometimes it can be difficult to get in and out of certain trades to find somebody to sell to or to find somebody to buy from. If you are buying it becomes tough because there’s low liquidity which means that there’s not enough people actually trading this coin. When you’re trading, only trade coins that have a lot of volume or a high market cap because it’s a safe idea. If you’re going to be day trading cryptocurrency then you probably just want to trade cryptos that are within the top 10 or the top 25. Anything outside of that may get you stuck with liquidity issues where it’s hard to sell your asset when you’re ready to get out and you then get stuck holding coins longer than you’d like to.