Which technical indicator is more preferred in technical analysis?

[figmentofmyass]

Also technical analysis does not apply to coins with a low market cap so this means that technical analysis only applies for the top 100 coins the rest of the coins need to be traded using fundamentals and by keeping your eyes on the news and the hype, this is why even a master at technical analysis will lose his money if he keeps his eyes on the charts on those coins.

I believe you do not get "why" some technical indicators are not applicable to low market cap coins. The reason for this is because low market cap coins have the tendency to have the highest volatility in the market. So what happens is all their predictions based on "technical analysis" also has the tendency to not predict the market, making them, most of the time, "off the mark".

but why do they have the highest volatility? and why does it follow that TA doesn't work then?

the bottom line is supply and demand. so, the key to understanding volatility is market depth. the reason BTC used to be so much more volatile (back in the day we used to see 50% swings in a day) was because of an utter lack of liquidity. whales could easily move the market---high demand into low supply.

low cap altcoins are the same way. due to the "cheap" price vs. BTC, whales can accumulate in a range until all the market liquidity is gone. and then? the only direction is up since there are no sellers left. the lack of market depth makes a 10x move very easy, like a hot knife through warm butter. this is the same exact thing we saw on the BTCUSD order books in 2013. all the supply disappeared, so the price skyrocketed.

so, it's really not about TA vs. FA. both should reflect the same thing. fundamental analysis (supply dynamics and catalysts for demand) will tell you why demand may overtake supply at a given price level. technical analysis looks for clues re supply and demand on the charts: does every dump attempt get bought up? has price risen above a major supply level, indicating further upside after resistance becomes support? does volume indicate major accumulation or distribution? all of this is valuable information to a trader.

FA for context: is this something i want to invest in, and are there fundamental reasons for increased demand? support/resistance and volume analysis for the rest.

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[entrepmind23]

I use fibonacci retracement and fibonacci extension for the potential support and resistance. I also use trend lines and then the leading and lagging indicators. As for the leading indicator, I use Relative Strength Index (RSI) to know if the coin is already overbought or oversold which would signal me then of a potential reversal of a trend if ever. For lagging indicator, I use Moving Average Convergence Divergence (MACD) like a confirmation of the trend reversal if there is a crossover. I look at the shapes and formations of the candles as well.

Each of us has different indicators to speculate the market but there are times when these indicators will be effective because majority of the traders use it. It is not because of the math behind it why it is effective but because majority of traders think alike when a certain price level is hit that's why a potential support or resistance price levels becomes a self-fulfilling prophecy. No matter what technical indicator you use as long as you understand the purpose of the indicators and have a proper risk management then you can be profitable.

[Wind_FURY]

Also technical analysis does not apply to coins with a low market cap so this means that technical analysis only applies for the top 100 coins the rest of the coins need to be traded using fundamentals and by keeping your eyes on the news and the hype, this is why even a master at technical analysis will lose his money if he keeps his eyes on the charts on those coins.

I believe you do not get "why" some technical indicators are not applicable to low market cap coins. The reason for this is because low market cap coins have the tendency to have the highest volatility in the market. So what happens is all their predictions based on "technical analysis" also has the tendency to not predict the market, making them, most of the time, "off the mark".

but why do they have the highest volatility? and why does it follow that TA doesn't work then?

Because low market cap coins also have low volume, and that causes higher volatility. Higher volatility causes more unpredictability. 

the bottom line is supply and demand. so, the key to understanding volatility is market depth. the reason BTC used to be so much more volatile (back in the day we used to see 50% swings in a day) was because of an utter lack of liquidity. whales could easily move the market---high demand into low supply.

Agreed.

low cap altcoins are the same way. due to the "cheap" price vs. BTC, whales can accumulate in a range until all the market liquidity is gone. and then? the only direction is up since there are no sellers left. the lack of market depth makes a 10x move very easy, like a hot knife through warm butter. this is the same exact thing we saw on the BTCUSD order books in 2013. all the supply disappeared, so the price skyrocketed.

Ok. Now I am confused. Are we in agreement now or are we arguing? Haha.

so, it's really not about TA vs. FA. both should reflect the same thing. fundamental analysis (supply dynamics and catalysts for demand) will tell you why demand may overtake supply at a given price level. technical analysis looks for clues re supply and demand on the charts: does every dump attempt get bought up? has price risen above a major supply level, indicating further upside after resistance becomes support? does volume indicate major accumulation or distribution? all of this is valuable information to a trader.

FA for context: is this something i want to invest in, and are there fundamental reasons for increased demand? support/resistance and volume analysis for the rest.

Besides asking for fundamental reasons, another question you should ask yourself, "is this altcoin being manipulated?". Hahaha.

The answer is usually yes.

[Denker]

Just wan to ask about which technical indicator is more preferred when you do technical analysis, your comments will be highly appreciated.

I use different trading systems and indicators, depending on coin, timeframe and trading style.
For position and swing trades I prefer to use Ichimoku with doubled settings for Bitcoin. Basically trading Kumo breakout, TK crosses and bounces from Kijun and Tenkan Sen with that System. Mostly hour and 4hour time frame as they give pretty good signals.

When I'm scalping (3min, 5min, 15min) I use a combination of BBands, MACD and RSI and TDI.
So I like to keep things simple and use mostly pretty known indicators.
Always have an eye Volume of course. As an addition to that for support and resistance I'm using Volume per Price (Volume Profile). That's it.
The rest is chart patterns and candle stick formations.

[Tzupy]

Wrong question, you should ask which indicator is preferred by traders, and it is MACD crossing. Just look at the pumps, they all happen on MACD crossings, as a risk reduction strategy.
The problem is to guess on which time frames the pump will happen, and if you miss it (you only have minutes to panic buy), where will the following minor correction find support.

[figmentofmyass]

low cap altcoins are the same way. due to the "cheap" price vs. BTC, whales can accumulate in a range until all the market liquidity is gone. and then? the only direction is up since there are no sellers left. the lack of market depth makes a 10x move very easy, like a hot knife through warm butter. this is the same exact thing we saw on the BTCUSD order books in 2013. all the supply disappeared, so the price skyrocketed.

Ok. Now I am confused. Are we in agreement now or are we arguing? Haha.

low volume and thin market depth are two sides of the same coin. volume is low because there is no liquidity. so i agree, we can expect high volatility because of that (the timing of which is unpredictable).

but the charts do tell us when accumulation is happening. so it's not just like taking a shot in the dark. it's more about sitting on investments while they're in accumulation phases, waiting for larger fish to eat up all the sell-side liquidity. once that liquidity is all gone, the price gets marked up. simple supply and demand.

i know manipulation is rampant, but i'm less interested in short term price spikes anyway. i'm looking for long term setups that develop over months, not pump and dumps.