Trading Kindergarten Lesson 1 – Full Lesson List:
So, we’ve moved onto Trading Kindergarten Lesson 1. Congratulations graduating from pre-school.
In Trading Kindergarten Lesson 1, now you’ve created your account at iceCUBED and some other exchanges. Great! It’s time to learn when to buy and sell to make profits.
Before we start, note that on our blog we do a weekly Trading and Price analysis. Here is an example. This will help your trading activity. Also, we do a weekly News Round Up each Friday. This is another useful resource. Here is an example.
Knowing when to buy and sell is tough. Every trader wants to know that. It’s what the game is all about. Don’t worry, we’ll guide you through the process.
To do it properly you need an idea of what is happening to the market price. For this you will need market data and charts. Some can be found here:
For beginners, this is a good chart source:
Firstly, there are three types of charts, generally, when trading.
Candlestick charts give you the maximum information, in a minimum amount of space.
An individual candlestick says 4 things.
From that we can see that, a chart that is mainly green and headed upward indicates we are in a bullish (up) trend. Whereas a chart that is mostly red, and headed downward, indicates a bearish (down) trend.
Each bar is a time-frame. On a 10-minute chart, each bar represents 10 minutes. For short-term day-trades use charts from 1 – 30 minutes. For longer-term trades you will need charts from 1 hour+. Ensure your chart is adjusted properly. It can be very costly if you don’t.
Make sure you watch the volume. It’s at the bottom of the page.
Volume is an essential factor to consider. Even if the price goes up, with little volume to support the rise, it will likely fall again. A price rise with a high volume volume is more likely to stick. Volume can also indicate the price trend. A green volume bar signifies and upward trend, and the opposite for red.
And lastly, watch the order book.
The order book consists of 2 elements: Bids and Asks.
Bids are how much traders are willing to pay for Bitcoins. Asks are the price traders are will to sell at. An order book tells you how much support the current trend has.