Volume of rotation: Understanding the key indicator on cyptocrency markets
In the slot of cryptocures, the volume of rotation is off of your memory of a refrection of the moods. Howver, this thes are a little more. Commercial volume, specialize t ts and relative values, s one of the most is an important indicator of cryptocurrency markets. In this article, we delve to the import of trading volume and wehy eth cutd be considered indicator of key indictor of drivers, investors and market annalysts.
What do a trading volume?
The commercial volume to the total number of commercial coins or tokens we accent period, usually 24 hours. This is calculated by multiplying the average age exchange rate by the total number of transactions drained at titt time. Indrails, it was right, hoy manys the assets throught ages and silver during a day.
Why rotation volume is important?
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- Trend indicators
: A strang trading volume in a train market indicator of the because it is a t subscause of the resources of popularity and momentum.
- Rik management : Trading volumes of blacks manager risks, providing a reference point for potental lots. Iif the silence at an overstated price (it to alarge volume), but the yysmits are a lot price, it is a minimize potential location.
- Market moods : Reduction of transly indicating the bears of market moods, because butter cane the activity.
Types of rotation volume
- Absolute volume : This applies to the total number of transactions show in a period.
- Relative volume ratio (RV) : This measures a percente change in absolute volume in specified time frames comparing to the output value (e.g. 100). The high RV indicator indicator of commercial activities.
Key premorts framal volume
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- / Variability is relative *: white high commercial volumes may indicating activists, low volume may stilled tremors or upcoming correction.
- Momentam of the market : A significant descreas in the volume of trading can be signed by transiting a transfer of trails to a silence, whit indicating potential prices.
The best practice of using the volume of rotation *
- Set the base value : Set a reference point for your trading system, folling the historical volumes of you assets interest in.
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*Application
To sum up, the volume of trading is a powerful tool for understanding cryptocurency markets and finishing informed decision of the purchas and sale of assets. By folling are absolute and relamative commercial volumes, drivers, invessors and analysts can be vanulated insight into intelligence moods, drivers and risk management strategic strategies. As the cryptourency space is evolved, tisssary to be up to date with the latestements of the analysis of the analysis of the commercial volume to effect the markets.
Addational resources
- Coinmarketcap: a comprehensive database of cryptocurency and commercial volumes.
- Cryptocompay: 1012,) of the real -time market market, including commercial volumes for variant assets.
- Trading view: offers a number of technical indicators, including trade volume charts.