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Commercial volume analysis for cryptocurrency: a guide to unlock market views
Cryptocurrencies have become increasingly popular in the last ten years, and many investors are trying to use their growth potential. A metric that can provide valuable information about the market performance of a cryptocurrency is the negotiation volume. In this article we will discuss the analysis of commercial volume and discover significant patterns in cryptocurrency markets.
What is commercial volume?
The negotiation volume refers to the total amount of cryptocurrency, which is marketed for a certain period of time and is generally measured in XRP (XRP) units per unit. It is an essential metric for distributors and investors, since it can help identify market trends, price movements and potential tenders.
Why analyze the negotiation volume?
Commerce volume analysis offers several advantages:
- Mercado’s feeling
: The high commercial volume often shows a strong market sensation, in which buyers are more active as a seller.
- Price reactions
: A significant increase in commercial volume may indicate an upcoming price movement, such as an outbreak or a rebirth.
- Risk management : Negotiation volume analysis helps investors, top levels and position sizes to be determined and minimized potential losses.
How to analyze the negotiation volume
Follow the following steps to obtain valuable knowledge of commercial volume analysis:
1. Identify key periods
- Look at historical data to identify certain time frames that have high or low commercial volumes.
- Grant in important milestones such as market breaks, rejections or tenders.
2. Commercial trade volume lines
- Use graphic software (for example, tradingview) or online platforms (for example, Coingcko) to draw commercial volume lines for different time frames.
- Analyze the slope and direction of the lines to identify patterns.
3. Identify trends **
- Search for recurring trends such as:
+ Increased trend lines
+ Trending lines down sizes
+ Bustle/bullish wedge
4. Classify the negotiation volume for price
- Share the negotiation volume in categories based on price movements:
+ Low volume (LVL): generally used for small transactions with low value.
+ Average volume (MV): It is used for medium -sized stores.
+ High volume (HV): Return for large high quality transactions.
5. Calify the negotiation volume in context
- Consider negotiation volume together with other market metrics, such as: B .:
+ Price movements
+ Market capitalization
+ Liquidity indicators (for example, offer/application differentials)
Commercial volumes of popular cryptocurrencies
Here are some examples of popular cryptocurrencies and their corresponding commercial volumes:
| Crypto | Commercial volume (XRP) |
| — | — |
| Bitcoin | 1.5 billion + |
| Ethereum | 2.5 billion + |
| Ripple (XRP) | 500 million – 700 million |
| Litecoin (LTC) | 50 million – 100 million |
Sample trade volume analysis
Suppose you have identified a commercial volume pattern for Bitcoin:
- Historical data show that the price of cryptocurrency has been tending since January.
- If you analyze the negotiation volume, you will notice:
+ A high volume peak on February 10, which coincides with a significant increase in the price.
+ A decrease in moderate volume from February 15 to February 20.
According to this analysis, its conclusion could be:
“The price of Bitcoin should break the resistance level of $ 18,000 and continue with its upward trend. The high commercial volume on February 10 suggests that retailers trust the potential of cryptocurrency.”
Diploma
Commercial volume analysis offers a powerful instrument for market ideas and offers valuable information about market moods, price movements and possible breakdown or tenders.