While cryptocurrency may be one of the hottest investments of the 21st century, it can also be difficult to make money in the same unless you have a thorough understanding of how the market is performing. One of the best ways to do this is by studying real-time cryptocurrency charts that track the performance of each cryptocurrency. If you’re uncertain how to read crypto charts, this quick guide introduces candlestick charts for cryptocurrency among the best live cryptocurrency charts.
What is the Candlestick Chart?
The concept of the candlestick chart was introduced by Japan. It is a highly accurate crypto chart as it provides information on when to sell or buy cryptocurrency, as well as signs that one needs to exit that particular cryptocurrency market. The most reliable signals from candlestick charts come from timeframes of at least four hours in length. Candlestick chart analysis is fairly simple and easy to understand.
How To Read Candlestick Charts?
Most platforms employ a red and green color scheme when it comes to candlestick charts for cryptocurrency. Red indicates that the cryptocurrency has gone down in value, while green indicates an uptick in value.
- Top And Bottom
For a green candlestick, the bottom indicates the price at which the cryptocurrency opened during a given timeframe, and the top indicates its closing price. It is the opposite of a red candlestick as the top indicates the opening price, and the bottom shows the price at which the timeframe ended.
These are sticks at the top and bottom of a candle and indicate price fluctuations during the given timeframe. For a green candlestick, the top wick indicates that the price went above the closing price at some point, while the bottom wick indicates that the price dropped below the opening price at some point. The reverse applies in the case of a red candlestick.
What to remember about candlestick charts?
It is important to remember that not all candles will look alike. Some candles may have small or non-existent wicks, indicating that there was little or no price fluctuation during the given timeframe. Also, the length of a candlestick indicates the degree of overall fluctuation between the start and the close of a timeframe for analysis. This pictorial depiction is a simple and accurate option if you are new to the world of cryptocurrency and seeking to know how to read crypto trading charts.