Let's consider a very important topic of fundamental analysis for cryptocurrencies.
If we talk about traditional markets the fundamental analysis takes into account the company's financial statement and macroeconomic climate, but in case of cryptocurrencies this information is unavailable because the lack of the publicity.
As a result the technical analysis role in crypto world is more significant, but applying the FA you can significantly improve your trading results.
Here is 7 areas which should be analyzed to apply complex approach.
1. ROADMAP AND WHITEPAPER. This point is most significant for the altcoins. The most reliable projects have a very serious development plan, every step should be explained in details in the roadmap and whitepaper. If it's not everything good with it, the project could be just scam.
2. MARKET CAPITALISATION. It is simple the coin quantity multiplied by the current market price of one coin. It is widely known that the lower market cap associated with the higher potential price growth.
3. VOLUME. If the coin has a low volume traded the huge manipulations could take a place in the market. The coin should be represented in the largest cryptocurrency exchanges it increases the probability that the corresponding project is not a scam.
4. COIN SUPPLY. Here we should know about if the coin supply restricted or not. If it is restricted the increasing demand pushes the prices higher.
5. FOUNDERS. The projects with a great potential is driven by founders and developers which have already realized some successful projects. In the opposite case it is probably scam.
6. DOMINANCE. On TradingView you can find the market dominance of BTC, USDT, ETH and Altcoins. This is the demonstration of the capital flow between different cryptocurrencies. For example if the BTC dominance decreased and Altcoin dominance increased the Altcoin's prices are not so significantly affected by the Bitcoin price changes.
7. NEWS. This is the most important part of FA, especially for the large cryptocurrencies. Thus the positive news push the price higher, while negative one entail dumps.
If we talk about traditional markets the fundamental analysis takes into account the company's financial statement and macroeconomic climate, but in case of cryptocurrencies this information is unavailable because the lack of the publicity.
As a result the technical analysis role in crypto world is more significant, but applying the FA you can significantly improve your trading results.
Here is 7 areas which should be analyzed to apply complex approach.
1. ROADMAP AND WHITEPAPER. This point is most significant for the altcoins. The most reliable projects have a very serious development plan, every step should be explained in details in the roadmap and whitepaper. If it's not everything good with it, the project could be just scam.
2. MARKET CAPITALISATION. It is simple the coin quantity multiplied by the current market price of one coin. It is widely known that the lower market cap associated with the higher potential price growth.
3. VOLUME. If the coin has a low volume traded the huge manipulations could take a place in the market. The coin should be represented in the largest cryptocurrency exchanges it increases the probability that the corresponding project is not a scam.
4. COIN SUPPLY. Here we should know about if the coin supply restricted or not. If it is restricted the increasing demand pushes the prices higher.
5. FOUNDERS. The projects with a great potential is driven by founders and developers which have already realized some successful projects. In the opposite case it is probably scam.
6. DOMINANCE. On TradingView you can find the market dominance of BTC, USDT, ETH and Altcoins. This is the demonstration of the capital flow between different cryptocurrencies. For example if the BTC dominance decreased and Altcoin dominance increased the Altcoin's prices are not so significantly affected by the Bitcoin price changes.
7. NEWS. This is the most important part of FA, especially for the large cryptocurrencies. Thus the positive news push the price higher, while negative one entail dumps.
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