Altcoin Index Perpetual FuturesEducation
The Power of Relative Analysis
Good morning guys,
I am going to explain here how to evaluate timing for any asset (crypto, stock, index), it can be extrapolated to any of them. Based on Technical analysis, Relative Analysis and Market timing:
If you 're looking to buy an asset you can have a look at the chart itself, which will provide you a very good idea of the timing for buying it.
For that, you will use Moving Averages (21,50,200) depending on your timeframe, and you will also use other indicators such as RSI, MACD or SO.
If you want to give an extra boost to your technical analysis you can use Ichimoku, Pitchfork...
But in the end, less is more. Try to focus on 2-3 indicators and master them, it will be easier and more profitable than having lots of indicators.
From my experience, I use moving averages (21,50,200), MACD or RSI for market momentum and Fibonacci for retracement levels.
The most popular indicators usually are the most important, because there're the most used by traders and investors.
But sometimes that's not enough, sometimes you need to reassure with other tools what you see in a single chart...
*Relative Analysis:
For example, if you want to buy a stock let's say
AMZN you can look at the chart but you can also have a look at the index which is listed in, in this case NASDAQ100.
So you can see if the index itself is bullish or not compared with the stock. But what if I told you that you can make a ratio plotting both charts in only 1 chart.
Then you could see a ratioAMZN / 
NDQ100, where if the chart goes up it means that AMZN is doing better than NASDAQ100. And if it goes down, NDQ100 is doing better than AMZN.
So you can see now if Amazon is bullish itslef as a stock and if it's doing better than the index itself and evaluate new resistance support zones in relation to Nasdaq100.
As an example, if you consider Amazon about to do some big move, e.g breaking a triangle pattern, you can see if the relative analysis shows you some resistance against its index, so probably it will break the triangle on the downside.
In order to do this in Trading View, you should go to the search bar and write: NASDAQ:AMZN / CURRENCYCOM:US100 ; You've to manually put the slash and then search for the next value.
*Other indicators:
If you surf the internet, you will find Fear & Greed indicators, telling you the market sentiment. You can also find market momentum simple indicators as well as Sentiment Surveys.
In reference to cryptos, you can find as wel Fear & Greed indicators (0-100) speedometer and Altcoins-Bitcoin Season indicator.
I'll leave here some links to these indicators:
money.cnn.com/data/fear-and-greed/
alternative.me/crypto/fear-and-greed-index/
blockchaincenter.net/altcoin-season-index/
stockcharts.com/h-sc/ui?s=$NYAD&p=D&yr=0&mn=11&dy=0&id=p79881806903
aaii.com/sentimentsurvey
I'll also link to this publication a couple of ideas regarding relative analysis NASDAQ/RUSSELL + BTC/GOLD published weeks ago.
Hope it's more or less clear. Don't hesitate to ask me any questions regarding the relative analysis or any other topics.
p.s: I did not talk about fundamental analysis because in my opinion chart graphs speak out loud, however you have to do your own research on each company. Fundamental analysis is another tool that we have to use to complement our analysis, specially if you're a long term investor. I am not diminishing it.
p.s.2: In the grapgh I explain Altcoin vs BTC index but as I previously said you can use it in any pair of your desire. e.g: Dash / Monero, BTC / ETH, Tesla / NIO...
Good luck everoyne and take care!
Cheers,
I am going to explain here how to evaluate timing for any asset (crypto, stock, index), it can be extrapolated to any of them. Based on Technical analysis, Relative Analysis and Market timing:
If you 're looking to buy an asset you can have a look at the chart itself, which will provide you a very good idea of the timing for buying it.
For that, you will use Moving Averages (21,50,200) depending on your timeframe, and you will also use other indicators such as RSI, MACD or SO.
If you want to give an extra boost to your technical analysis you can use Ichimoku, Pitchfork...
But in the end, less is more. Try to focus on 2-3 indicators and master them, it will be easier and more profitable than having lots of indicators.
From my experience, I use moving averages (21,50,200), MACD or RSI for market momentum and Fibonacci for retracement levels.
The most popular indicators usually are the most important, because there're the most used by traders and investors.
But sometimes that's not enough, sometimes you need to reassure with other tools what you see in a single chart...
*Relative Analysis:
For example, if you want to buy a stock let's say
AMZN you can look at the chart but you can also have a look at the index which is listed in, in this case NASDAQ100.So you can see if the index itself is bullish or not compared with the stock. But what if I told you that you can make a ratio plotting both charts in only 1 chart.
Then you could see a ratio
AMZN / NDQ100, where if the chart goes up it means that AMZN is doing better than NASDAQ100. And if it goes down, NDQ100 is doing better than AMZN.So you can see now if Amazon is bullish itslef as a stock and if it's doing better than the index itself and evaluate new resistance support zones in relation to Nasdaq100.
As an example, if you consider Amazon about to do some big move, e.g breaking a triangle pattern, you can see if the relative analysis shows you some resistance against its index, so probably it will break the triangle on the downside.
In order to do this in Trading View, you should go to the search bar and write: NASDAQ:AMZN / CURRENCYCOM:US100 ; You've to manually put the slash and then search for the next value.
*Other indicators:
If you surf the internet, you will find Fear & Greed indicators, telling you the market sentiment. You can also find market momentum simple indicators as well as Sentiment Surveys.
In reference to cryptos, you can find as wel Fear & Greed indicators (0-100) speedometer and Altcoins-Bitcoin Season indicator.
I'll leave here some links to these indicators:
money.cnn.com/data/fear-and-greed/
alternative.me/crypto/fear-and-greed-index/
blockchaincenter.net/altcoin-season-index/
stockcharts.com/h-sc/ui?s=$NYAD&p=D&yr=0&mn=11&dy=0&id=p79881806903
aaii.com/sentimentsurvey
I'll also link to this publication a couple of ideas regarding relative analysis NASDAQ/RUSSELL + BTC/GOLD published weeks ago.
Hope it's more or less clear. Don't hesitate to ask me any questions regarding the relative analysis or any other topics.
p.s: I did not talk about fundamental analysis because in my opinion chart graphs speak out loud, however you have to do your own research on each company. Fundamental analysis is another tool that we have to use to complement our analysis, specially if you're a long term investor. I am not diminishing it.
p.s.2: In the grapgh I explain Altcoin vs BTC index but as I previously said you can use it in any pair of your desire. e.g: Dash / Monero, BTC / ETH, Tesla / NIO...
Good luck everoyne and take care!
Cheers,
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