A technical indicator is a statistical algorithm or pattern-based indication based on a security’s or contract’s historical price, volume, and/or open interest.
A technical indicator is a tool used to analyze financial data, such as price, volume or open interest. Technical indicators are typically used in conjunction with technical analysis, a method of evaluating securities by analyzing market activity-generated statistics, such as past prices and volume.
Technical indicators are used to analyze the past behavior of a security or market to try to identify patterns that can be used to make predictions about future behavior. Some of the most commonly used technical indicators include:
In crypto, technical indicators can be used to identify trends and potential entry & exit points, and predict future price movements. Some popular technical indicators used in the crypto market include the MA, the RSI and the Bollinger Bands. Other popular technical indicators are On-Balance-Volume (OBV), the Accumulation/Distribution Indicator, the Average Directional Index (ADV), and the Aroon Indicator.
Cryptocurrency traders often use technical indicators and other tools and techniques, such as fundamental analysis and sentiment analysis, to make informed trading decisions.