Anybody who has been investing or following bitcoin knows that the cryptocurrency has been on one heck of a rollercoaster ride over the past few months. The recent price rally is a testament to the high volatility of the crypto space.
While these fluctuations in bitcoin’s price over the past year have gotten many crypto traders excited mainly because it gives them more chances to buy and sell bitcoin for a profit, on the other hand, many folks tend to be afraid to enter this highly volatile marketplace. And with the many articles and videos out there on crypto trading strategies, making sure you choose the right one can be a tough nut to crack for many beginners. But it doesn’t have to be that way.
The great thing about the times we live in is that we all have easy access to technology. Today, information on almost anything that we want to know is just a few clicks away. The same goes for bitcoin trading as well.
Back in the day, platforms that offered useful data on various bitcoin metrics were restricted to those with deep pockets. Today, anyone interested in bitcoin trading can access this critical information that they can then use to their advantage. In fact, many bitcoin trading platforms can guide you through the entire bitcoin trading process, which takes the guesswork out of the equation even if you are a beginner.
One of the main challenges faced by those who trade bitcoin is interpreting the crypto’s market volatility. This is what separates the successful bitcoin traders from those who end up losing money simply because they did not put in the time and effort to find the information they needed before making a trade.
Well, the good news is that there is a way in which bitcoin traders can gauge profit and loss supply metrics to help predict price rallies, especially in bitcoin. Suppose you have just started out with bitcoin trading. In that case, the recent price rally alone should be enough for you to determine just how important gauging on-chain data such as bitcoin’s profit and loss supply metrics is if you want to really make a profit with each trade.
Why Should You Care About Interpreting Bitcoin Trends?
If you’re an investor in bitcoin, this past week may have just been the most exciting time of your entire life. That’s because bitcoin was able to do the impossible, just like it has many times before, by hitting a record high of $69,000. What’s really incredible is that all this happened despite news of new Chinese regulations. So, how does one make a profit with bitcoin?
The answer lies in the bitcoin supply in profit and loss using technical trend lines. For beginners, this is a great way to gauge how bitcoin will react to various market stimuli. For example, you can take the net percentage of bitcoin supply in profit and loss metrics and throw in a 21-day moving average setting. This is to help you avoid the notorious sawtooth effect that can make it difficult to get an exact analysis.
The best part is that both new and experienced bitcoin traders can easily create identical data settings in any account of a blockchain data provider. Once the indicator has been configured, all you have to do is apply the technical analysis you find as in, the data on the trend lines on the on-chain data and use it while trading bitcoin on reliable bitcoin trading platforms, such as ethereum-trader.app, and you have just created a money-making machine.