Mindblown: a blog about philosophy.
-
Time & Candles
In your quest to understand where price is going it’s up to you to decide the time frame within which you want to operate, remembering the distinction between Trading – short term decision – and Investing – long term positions. Charts enable you to zoom out and look at the broadest possible time scale, or…
-
Visible Trends Linear vs Log Scale
Given the exponential increases in bitcoin’s price over a ten year period (600x) only the most dramatic changes are visible. 2017 Bull Market – $20k ATH 2018/2019 Bear Market falling below $3k Covid Crash March 2020 falling below $5k 2020/21 Bull Market – $61k ATH However, if you switch to a log scale, where the…
-
Bitcoin Price Chart Basics
At the most basic level, a bitcoin price chart is a line graph on two axes illustrating price history for bitcoin trades conducted between a specific pair of currencies. Bitcoin’s price is always relative to another specific currency, known simply as a Trading Pair. Trading pairs are offered against base currencies – currencies which are the…
-
What are crypto price charts?
What you’ll learn The basic functions of a crypto price chart How to read candlesticks What candlesticks say about the market Our previous article talked about how bitcoin’s price is generated, the role of exchanges in bringing together buyers and sellers to trade, and the kind of basic information they provide about trades. Price is…
-
Executed Trades
Once the buyer and seller have met at a point that satisfies both – either through Market or Limit Orders – a trade is executed which defines the price at that point in time. Historic trades are also available as part of a Trading Display and can provide valuable retrospective information, but the most fundamental…
-
Exchange Depth Chart
The Order Book is tabular and fluid so can be difficult to read, though as we’;ll see serious traders don’t do things simply by eye. To help provide an easy way to interpret what the Order Book is saying, Bids and Asks and their relative amounts are visually represented in a Depth Chart. The Depth…
-
Exchange Order Book
An exchange will share what price a buyer is prepared to buy bitcoin at, and how much they want to buy at that price. This is described as a Bid. Alongside the list of Bids, sorted by price, will be the Order Book of Sellers, providing the detail of sell Offers; the price and amount…
-
Buying Over the Counter (OTC)
So we can now understand, in a very basic way, how bitcoin’s price is reached, through the interaction of buyers and sellers at exchanges. Exchanges aren’t however, the only way to buy bitcoin. Where an individual or organisation wants to buy or sell a large amount of bitcoin, they may not want to go through…
-
Barriers To Bitcoin Price Discovery
Where market conditions are the same, the price across exchanges won’t differ greatly, which is the sign of an efficient market. If not, users would simply buy at the lowest price on exchange A and sell at the highest available price on exchange B (aka arbitrage). Compared to more mature assets – like gold or fiat…
-
Price Discovery & Exchanges
The process of identifying a fair value for bitcoin is called price discovery. Every market participant will in theory be utilising all available information about bitcoin – Technical, and Fundamental – as well considering the behaviour of other market participants to discover the true price. We’ll unpack the influences on price discovery later in the section,…
Got any book recommendations?