I recently came across an
interesting article discussing Bitcoin's current price movements and potential future scenarios.
It highlighted a possible drop and mentioned various technical indicators on both the
4-hour and
1-day charts. The piece also presented two possible scenarios:
- further decline
- potential recovery.
I’d love to hear your thoughts on how the technical indicators might influence Bitcoin’s next move.
Technical indicators produce trading signals. It can affect traders to move according to the output of these technical indicators. Since this is mathematically done using the history and current volume of the market trading, it can give a hint of the possible direction of the next move of the market. In short, most traders use technical indicators to gain valuable insight on the possible direction of the market and put their money on it.
Here is a study of technical indicators' impact on trading:
https://onlinelibrary.wiley.com/doi/10.1155/2022/9916310 showing how it greatly helps traders to have a positive result on predicting the trend of the given stocks. With these as proof of the reliability of technical indicators, I believe traders will put their funds accordingly depending on what their study and calculation of technical indicators show.