HOMEWORK TASK 1
INSTITUTION: STEEMIT CRYPTO ACADEMY
COURSE: WHY TECHNICAL KNOWLEDGE IS IMPORTANT IN CRYPTO TRADING AND HOW TO READ, UNDERSTAND THE TECHNICAL CHART
CRYPTO PROFFESSOR: STREAM4U
HOMEWORK TASK: Why Technical knowledge is Important in Crypto Trading?
Hello everyone, welcome to my homework task entry for the above-stated course lectured by the above-stated crypto professor.
Technical knowledge is so important in crypto trading and in this post, I'll be explaining why I think so.
I used to think of technical knowledge in crypto as boring stuff. As an investor, my procedures were only, look for a utility coin project, wait for coins of similar projects to appreciate in value, then buy that coin. This before now has worked for me at least when I bought HT (Huobi Tokens) after seeing the rise in the price of BNB.
However, having learned from this course the importance of technical knowledge and how to read and understand the technical chart, I reckon that my despise of technicality in crypto trading has simply been to want of knowledge, as for benefit, technical knowledge guides the trader with enviable precision.
WHAT IS TECHNICAL KNOWLEDGE?
In my opinion, technical knowledge is an understanding of the information provided by technical analysis.
In a layman's expression, when you carry out a technical analysis on a subject and come up with information which you understand, then you have technical knowledge of that subject. In our case, our subject is cryptocurrencies.
WHAT IS TECHNICAL ANALYSIS?
From the knowledge I gathered from this course, technical analysis is the analysis of data obtained from a history of price actions . It is usually done to decipher which action is best to be taken by the trader at any given time, whether buy or sell. It is done using technical charts.
WHAT IS THE ROLE OF A TECHNICAL CHART
Technical charts as have been hinted earlier, are the instruments used for technical analysis. They are basically charts which show the history of a price movement.
The role of a technical chart is simply to provide a comprehensive information on the history of a particular asset's price movement. One important aspect of the information a technical chart provides is the statistical trend of the asset's price movement history.
The information provided by a technical chart is what is used for technical analysis.
WHY DO I THINK TECHNICAL KNOWLEDGE IS IMPORTANT
Personally, I believe that right information increases the chance of profit in any investment. Technical knowledge offers precise information on the best direction to take in the market at any given time. Without such valuable information, one may at best, make some profit by chance but would definitely be taking uneducated and uncalculated risks.
WHICH IS PREFERRED FOR BUYING A COIN, UPTREND OR DOWNTREND?
Generally, uptrend for me is good for buying a coin. This is because it is a proof of the ability of the coin to increase in value.
EXAMPLE OF A CRYPTO TECHNICAL CHART - HT/USDT ON HUOBI GLOBAL.
From the chart above, one can see that HT has been bullish since the start of 2021. It also has a record of maintain a particular prices range as can be seen from early November (the beginning of the chart) to late December.
My guess is that with this trend, as HT begins to rise, it will rest on a particular price and oscillate around it for some time. Knowing HT as the main utility token of the world's second largest crypto exchange by trade volume, I'm certain it will still rise again. So, it is likely to be profitable to buy now.
Disclaimer: Though the above stated analysis is the reason why I bought HT some days ago at $12.32, it is my own opinion and not an investment advice.
CONCLUSION
Technical knowledge is important as it gives valuable direction and guidance to the crypto trader. Without this knowledge a trader is only trading by chance which is not an ideal trading practice.
Thanks for reading.
Cc:
@steemcurator01
@steemcurator02
@steemcurator04
@stream4u
Special mention:
To the attention of some notable steem promoters who keep inspiring me on my crypto journey which began here on steemit.
@stephenkendal
@trafalgar
@crypto.piotr
@steemchiller
@justyy
I also solicit the pardon of @steemitblog and @stream4u for late submission of this homework task. I didn't join the steemit crypto academy on time and it appears that this homework task is essential for the completion of homework task 2 which is currently on.
