$TRUST Do you really understand the K-line in the cryptocurrency market? Have you learned to use these technical indicators correctly?
Each technical indicator has its clear purpose behind it, so don't mix these indicators together and use them randomly:
① Moving Average (MA): Used to determine trend direction
When the short-term moving average crosses above the long-term moving average, it is called a "golden cross" and is often seen as a bullish signal;
When the short-term moving average crosses below the long-term moving average, it is called a "death cross" and may indicate a weakening market.
② Relative Strength Index (RSI): Used to determine overbought and oversold conditions
RSI > 70 indicates the market is overheated, increasing the risk of chasing highs;
RSI < 30 indicates the market is cold, and there may be opportunities for a rebound or bottom-fishing.
③ Average True Range (ATR): Used to measure market volatility
The larger the ATR, the more intense the market volatility;
Commonly, ATR×1.5 is used as a stop-loss reference, which can better match the true market fluctuations.
④ MACD Indicator: Used to determine changes in trend momentum
When the MACD line crosses above the signal line, it is a bullish signal;
When it crosses below the signal line, it is a bearish signal;
An increasing histogram represents a strengthening trend, while a decreasing histogram indicates a weakening momentum.
⑤ Bollinger Bands (BOLL): Used to determine price range
When the price touches the upper band, the market may be overheated;
When it touches the lower band, the market may be cold;
When Bollinger Bands continue to narrow, it often signals an upcoming significant market movement.
⑥ Fibonacci Retracement: Used to find support and resistance levels
In an uptrend, a retracement to the 0.5–0.618 range is often seen as a potential buying point;
In a downtrend, a rebound near 0.382 is likely to encounter resistance.
⑦ Volume (VOL): Reflects market activity
When volume increases with rising prices, the trend is more credible;
When volume decreases with rising prices, the sustainability is questionable;
When prices break through, it must be accompanied by observation of volume.
⑧ Market Sentiment Indicator (Fear and Greed Index): Used to assess emotional cycles;
In extreme fear stages, it often approaches the market bottom;
In extreme greed stages, one should be wary of the risk of a pullback.
⑨ Money Flow (OBV): Used to observe fund inflows and outflows;
When OBV continues to rise, it represents fund inflow;
When OBV continues to decline, it represents fund outflow, and prices are likely to weaken.
Remember: Indicators are not used for prediction; they are used to validate trends and control risks;
Understanding a single indicator is not valuable; the true core of making money lies in multi-indicator resonance + acting in accordance with the trend.
