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Month: September 2021

Learn the Best Indicators for Day Trading Crypto

The kind of gains the whole crypto market showed in 2021 is exceptional. This “crypto blast” even affected people who had never heard about cryptocurrencies. 

The Reddit community WallStreetBets demonstrated how strong retail day traders could become when working together. Traders all around the world use certain indicators to gain more confidence in their selections. They frequently pair indicators with risk-management tools to obtain more accurate price information.

Are you already interested in indicators for day trading crypto? Stay with us! This article lists some of the best indicators to use as companions in day trading.

What Is a Trading Indicator?

The trading indicator is a tool typically based on algorithms that display historical price data to assist traders in making decisions. It usually gives data on market volatility, trend strength, and overbought or oversold market circumstances. Through mathematical calculation, the indicators provide additional assurance concerning pricing and volume.

For those who don’t have a deep understanding of the crypto market and don’t know how to start day trading, indicators help a lot.

4 Best Indicators for Crypto Day Trading

These are the ones you should check before making a day trade. You can use just one indicator or all at the same time to eliminate the gaps of each. 

1. Exponential Moving Average

The exponential moving average (EMA) is a graphical tool used in trading that indicates how an asset’s or security’s price changes over time. The EMA differs from a simple moving average in that it gives recent prices more weight over other factors.

All moving averages are designed to determine how a security’s price is moving based on previous prices. Exponential moving averages are hence lag indicators. They do not forecast future prices; instead, they illustrate the crypto price’s current movement.

They can be observed in various forms, such as 21-day EMAs, 50-day EMAs, and 100- or 200-day EMAs. Prices are more sensitive to EMAs taken over shorter periods. As a result, a 21-day EMA line tracks prices more closely than a 100-day EMA line.

2. Moving Average Convergence/Divergence 

MACD, or moving average convergence/divergence, is a trading indicator used in the crypto market’s technical analysis. Its purpose is to detect changes in the strength, direction, momentum, and duration of a trend in the price of a crypto asset. 

The MACD indicator might help you spot specific price trends quickly. When the crossing occurs above zero, it usually shows an uptrend. When the corner occurs below zero, it usually indicates a decline. MACD indications can be interpreted in various ways, although crossovers, divergences, and quick rises/falls are the most popular.

3. Average Directional Index

The average directional index (ADX) is the only indicator on the list that does not provide movement direction. An ADX doesn’t show in which direction a particular crypto asset can go. It only shows the strength of the trend in whatever direction it moves and how strong it could be.

The ADX is represented as a single line with values ranging from zero to one hundred. When the ADX line is below 25, it indicates weak bearish or bullish trends, such as a market that isn’t trading or that is ranging, and there is low risk. If the ADX line is over 25, the trend is firmly upward or downward and has significant risk.

4. Average True Range 

The average true range (ATR) is an indicator that decomposes the complete range of a crypto-asset price for a certain period to determine market volatility. The ATR is like a moving average of an asset’s price movement calculated for 14 days, although it can be different depending on your approach.

It aids traders in predicting how much an asset’s price will shift in the future and determining how far out a stop loss or profit objective should be placed.

Average true range trading is rarely utilized in manual techniques, but it is frequently employed in developing trading advisors’ risk-managing systems. This indicator does not indicate the strength of a trend and cannot predict a price’s next movements. It simply provides a rough calculation of market volatility.

How to Trade with an Automated Trading System

Obolon9 provides you with a set of already designed scenario-based trading tools (plus a custom scenario) through an automated crypto trading system. The freedom of manual trading and the accuracy of designed scenarios combine the best of both and deliver the desired results.

You may create your first scenario on Obolon9 in five simple steps.

  • Name your scenario: Name your scenario based on the coin/token you are trading and the target you are looking to achieve.
  • Choose a strategy: For achieving your targets, you have to set up your strategy. You can go for an already designed strategy or customize a specific one for yourself. You can also import one from TradingView (a social network of 30 million traders and investors who use the most excellent charting and analysis tools in the world to spot market opportunities). 
  • Select a crypto exchange and crypto asset: Choose a crypto exchange and a crypto pair to trade.
  • Specify parameters: Complete the remaining asset parameters you want to track in the scenario. Your scenario will only issue alerts/trades if these factors are favorable.
  • Click on Save and Run: You’re done; your scenario is already operational.

Conclusion

Indicators for day trading crypto help the trader earn maximum profits and decrease the level of risk. Combining them can be a good idea — this way, you unite their strong sides. 

Indicators like the exponential moving average provide information that helps you predict the market’s next move. If you want to automate your trades with a trusted system, you can try Obolon9.

Ethereum 2.0: What Is the Future All About?

Ethereum remains an innovative platform in the cryptocurrency space. The system’s pacesetting strides have certainly earned its investors remarkable returns. ETH has grown over 900% in the past 12 months — 600% more than Bitcoin in the same period! In addition, it has remained a major competitor to BTC and is the second most valuable cryptocurrency globally.

However, Ethereum has not been without its shortcomings that negatively influence this network. Consequently, Ethereum 2.0 is currently under creation to correct its issues, but is the upgrade necessary? Will it be worth it? What are the benefits of creating ETH 2.0 while Ethereum is so successful? Keep reading for answers to these pivotal questions.

Understanding the Foundation: What Is Ethereum?

Ethereum is an open-source resource for the development of decentralized applications. The platform is available worldwide and accessible to everyone: the goal is to establish a protocol that allows for permissionless application creation with globally accessible data and states. Smart contracts are one of Ethereum’s key tools; they allow all participants to automate the execution of their agreements and be certain of the outcome. 

Transitioning From PoW to PoS

  • Like most cryptocurrencies launched after 2012, Ethereum uses a similar consensus mechanism to Bitcoin — Proof-of-Work (PoW). This protocol has two major functions, which are to facilitate node incorporation to verify data published on the ETH platform and to foster Ethereum’s economic growth. PoW has played its roles to a significant extent, but there are imperfections that the network cannot ignore anymore.
  • Key among these shortcomings are slow transaction speeds and relatively expensive gas fees. CryptoKitties — an ETH-based game — makes for a good example; this program was the first introduction of NFTs (non-fungible tokens) and gained incredible popularity shortly after its release. Unfortunately, this clogged the network, resulting in numerous transactional difficulties.
  • DeFi’s (Decentralized Finance) emergence further emphasizes the relevance of a streamlined system. DeFi may have recorded excellent market growth since its introduction, but the PoW consensus leaves much to desire. Consequently, some investors have switched to other blockchains, while others remain spectators until the edges are ironed out. Ethereum’s boundaries may be limitless with more stable fees and better scalability.
  • In comes Ethereum 2.0, an upgrade that became necessary to cover for ETH 1.0 boomerang flaws. Developers are targeting a more scalable network and a wider blockchain acceptance. Several changes are in the offing, notably the switch from PoW to PoS (Proof-of-Stake) consensus mechanisms. Staking assures more participants in the network, an improvement that may achieve perfect ETH decentralization.

Notable ETH Shortcomings: Why Do Crypto Users Need ETH 2.0?

Ethereum may be uniquely innovative and may have recorded incredible growth since its launch in 2015. However, there are a few concerns about the platform — some too significant to ignore. Let’s see what they are.

  • A Clogged-Up System: Choked arteries considerably limit Ethereum’s aim to spread across the world. The platform may be present globally as it stands, but the population on the blockchain was unprecedented. Transactions may be slow and difficult due to the need to verify every transaction before completion.
  • Insufficient Disk Space: The ever-growing ETH populace has also affected the smooth incorporation and running of nodes. These are special software that facilitate seamless operations across the platform.
  • High Energy Consumption: Ethereum uses an unsustainable power source for the maintenance of network security for the Proof-of-Work consensus algorithm. This may threaten environmental health.

Ushering in a New Dawn: What Is ETH 2.0?

ETH 2.0 is an enhanced version of the Ethereum blockchain. This product redefines Ethereum’s goals, as establishing a global, open-source protocol isn’t enough anymore; the platform now targets faster speeds, better security, and more convenience. 

Assessing ETH 2.0: What Promise Does It Hold?

With ETH developers back to the drawing board to launch an upgraded version, what may investors expect?

  • Greater Scalability: The choking crowd on the Ethereum blockchain makes it imperative to build a system that may facilitate thousands of transactions per second (TPS). ETH 2.0 assures this need, resulting in cheaper fees and faster sprints.
  • Improved Security: ETH 2.0 promises a highly secure platform that supersedes the security level currently at Ethereum. User institutions and other stakeholders are bound to feel safer and more comfortable with this development.
  • Sustainable Energy: ETH 2.0 is programmed to run without any mining. This change invalidates the PoW consensus algorithm, which consumes excessive energy — thereby guaranteeing environmental sustainability.

Ethereum 2.0  Release Date: When Is the Future Reaching Us?

The Ethereum 2.0 release is scheduled as a three-phase arrangement. 

Phase 0: Beacon Chain (2020)

The Beacon Chain’s primary function is to oversee the implementation of the Proof-of-Stake algorithm and pave the way for all its Shard Chains to follow in Phase 1.

Phase 1: Shard Chains (2022)

This phase splits the Ethereum blockchain into multiple phases, leading to a better capacity for storing data and processing transactions. 

Phase 2: Execution Engine (2022 – 2023)

The Execution Engine will support contracts, accounts, stats, and other data that users, developers, and other stakeholders gain from the current smart contract languages. 

Final Thoughts

Ethereum is an excellent platform for developers to write codes for creating decentralized applications. The system also offers smart contracts, which are unique Ethereum accounts that may conduct agreements as they are programmed. 

However, all these benefits don’t excuse the platform of its issues. Transactions stumble from time to time, courtesy of the clogged-up network and the inability to run nodes seamlessly. It’s become clear that the blockchain requires an upgrade, and few investors would disagree with the necessity of ETH 2.0. Ethereum 2.0 promises and already appears to be a very effective project, but time will tell.

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