Reading Crypto Charts

Understanding price charts is essential for successful crypto trading. This guide covers the fundamentals.

Candlestick Basics

Each candlestick represents price action over a specific timeframe (1m, 5m, 1h, 1d):

• Green/White Candle: Price closed higher than it opened (bullish)
• Red/Black Candle: Price closed lower than it opened (bearish)
• Wick (Shadow): Shows the high and low during the period
• Body: Shows opening and closing prices

Key Patterns

Doji

Equal open and close prices - indicates indecision

Hammer

Small body with long lower wick - potential bullish reversal

Shooting Star

Small body with long upper wick - potential bearish reversal

Engulfing Pattern

One candle completely engulfs the previous - strong reversal signal

Timeframes

• Scalping: 1m, 5m charts
• Day Trading: 15m, 1h charts
• Swing Trading: 4h, 1d charts
• Investing: 1d, 1w charts

Volume Analysis

Always check volume alongside price:
- High volume confirms price movements
- Low volume suggests weak conviction
- Volume spikes often precede major moves

Support and Resistance

Identify key levels where price historically bounces or reverses. These act as psychological barriers.

Practice reading charts daily to develop pattern recognition skills.