Using Basic Technical Analysis Tools to Predict Short Term Price Changes and Trade Bitcoin, SimpleFX Explains

If you are a crypto enthusiast considering day trading, but lacking the knowledge of how to start, SimpleFX brings this great piece of reading for you. Here we are focusing on the way Bitcoin is traded and the prediction of short-term prices based on basic technical analysis tools. The article provides information about the process.

The volatility of Bitcoin and other cryptocurrencies is the rate at which their price increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a stipulated time period. Those who have been associated with the crypto space can understand the reason behind it better. The cryptocurrency world is volatile because it cannot be controlled and therefore would continue to trade in the free markets frequently.

CFDs are financial derivatives which are conducted as agreements (contracts) between a trader and a brokerage company. When we have a contract, we do not actually own the underlying asset, instead, we possess the right to receive the difference between the current value of an asset and its value in the future. If our prediction on the value of the underlying asset is incorrect, and the difference is negative, the trader will have to cover that loss. CFDs can be created for shares, indices, forex, and also cryptocurrency. With CFDs, traders can speculate on the price growth and price decline of an underlying asset. There is a great guide to cryptocurrency trading which explicitly focuses on crypto trading with CFDs.

The Significance of Basic Technical Analysis Tools in Crypto Trading

Any of us investing in the flourishing, as well as the unpredictable crypto market, is deeply concerned about the crypto prices. Buying any cryptocurrency at the wrong time can put your trade-in negative, this can happen quickly and substantially, and if you are new to crypto trading, this can start your journey off on the wrong path. By using some basic technical analysis, you can start making better decisions about timing your entrance into a coin and thus be a more profitable trader.

Crypto traders have several tools to assess the cryptocurrency market. One of them is an approach known as Technical Analysis. Using this method, traders can get a better understanding of the market sentiment and isolate significant trends in the market. This data can be used to make more educated predictions and wiser trades.

To get a better idea of technical analysis, it is crucial to understand the fundamental ideas of the Dow Theory that tech analysis is based on:

  • The market considers everything in its pricing. All existing, prior, and upcoming details have already been integrated into current asset prices. With regards to Bitcoin and crypto, this would be comprised of multiple variables like current, past, and future demand, and any regulations that impact the crypto market. The existing price is a response to all the current details, which includes the expectations and knowledge of each coin traded in the market. Technicians interpret what the price is suggesting about market sentiment to make calculated wise predictions about future pricing.
  • Prices movement aren’t random. Rather, they often follow trends, which may either be long or short-term. After a trend is formed by a coin, it’s probably going to follow that trend or oppose it. Technicians try to isolate and profit from trends using technical analysis.
  • ‘What’ is more important than ‘Why’. Technicians are more focused on the price of a coin than each variable that produces a movement in its price. Although multiple aspects could have influenced the price of a coin to move in a specific direction, Technicians assertively review supply and demand.

In stocks, insiders are people like executives and mutual funds who have material, unfair advantage over outsiders who don’t have access to the latest financials, boardroom meeting minutes, etc. In cryptocurrencies, insiders are 1) the executives of the companies behind cryptocurrency tokens, 2) mining pools, and 3) large holders (i.e. “whales”). Regardless of the asset, insiders have access to critical information sooner than the outsiders, which allows them to buy before rallies, or sell before selloffs.

The best 5 technical analysis indicators for cryptocurrency include:

  • Moving Average
  • Bollinger Bands,
  • Relative Strength Index (RSI)
  • MACD
  • Crypto price

And SimpleFX’s WebTrader platform covers all that.

SimpleFX, a forex and cryptocurrency CFD broker, is set to launch a new and improved version of its WebTrader platform. This new BETA release features a unique redesign of the platform. It also includes several upgrade tweaks that are sure to improve the user experience. The new SFX WebTrader focuses on ease of use with many necessary upgrades to both the design interface as well as the platform tools.


The platform features a complete design overhaul. The trading engine has also been revamped, delivering faster loading times and pricing updates. Traders can efficiently manage their accounts via a host of adjustable and customizable option menus.


One of the significant improvements in this latest iteration of the SFX WebTrader is the inclusion of fully adjustable technical analysis tools which include:

  •         Bars, Area for the chart.
  •         Different trend lines, arrows, ray, channels, angle.
  •         Shapes: rectangle, ellipse, triangle, curve, arc.
  •         Fibonacci tools, Gann, Pitchforks.
  •         Brush, patterns, ruler, price range, object tree.


Traders can also either view charts on market list or current price levels for all symbols and currency pairs on the platform.  It is the simplest, easy-to-pick-up online trading platform that has been designed for every device. Users enjoy direct crypto deposits and payouts as well as up to 1:500 leverage. Moreover, Simple & Safe API manager allows users to plug in advanced trading tools.

Start using it now at

Images courtesy of SimpleFX

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