Technical analysis has long been a cornerstone of trading, as it helps traders refine their strategies in financial markets and cryptocurrencies. However, with the ever-evolving landscape of cryptocurrencies and increased geopolitical tensions, one question remains: Can technical analysis still beat the crypto market today? 

In this article, we’ll explore its effectiveness in modern crypto trading by examining its strengths and limitations. Later, we’ll look into how AlgosOne, a relatively new AI-powered trading bot, uses technical analysis to execute trades with more than 80% precision and helps to beat the market. 

What is Technical Analysis?

Technical analysis allows traders to forecast the market by processing historical price data. This data is then plotted on trading charts, and traders later use it to judge the market’s next move. 

There are many technical analysis tools available for traders, each with unique abilities that cater to different types of traders and their strategies. But in the background, every technical analysis tool uses price and volume, and relies on three core principles.

The first principle is that price discounts everything, meaning all known information is already there and is reflected in the price. Secondly, price moves in trends, which can be upward, downward, or sideways. Lastly, history repeats itself, meaning market psychology leads to recurring price patterns.  

Common Types of Technical Analysis Tools in Crypto Trading

Common Technical Analysis tools and indicators used in cryptocurrencies include: 

1. Support/Resistance Levels

This shows key price zones where buying/selling pressure emerges, helping traders determine when to enter and exit a trade. 

2. Relative Strength Index (RSI)

The RSI helps to identify if the market is overbought or oversold, giving traders an idea of what type of trade they should take, either long or short. 

3. Fibonacci Retracements

Helps to identify potential price reversals.  

Does Technical Analysis Work In Crypto?

Unlike traditional markets, cryptocurrency operates 24/7 and is deeply influenced by social media, regulatory news, and retail sentiment. As it operates 24/7, a constant flow of new variables makes price behavior more difficult to predict using historical data. 

The volatile nature of cryptocurrencies means even a single post by a celebrity can have a massive impact on the prices, making technical indicators somewhat obsolete. Another issue technical analysis faces in crypto is using high-frequency trading bots and other AI-driven algorithms that currently dominate the market. 

Therefore, it is safe to say that technical analysis alone does not work anymore in crypto. Only traders with years of experience can use technical analysis effectively, and that too during shorter timeframes. 

Hybrid Trading Approach in Crypto 

In today’s crypto landscape, many successful traders have adapted a hybrid strategy that involves technical analysis indicators and on-chain metrics. They track whale wallets, tokenomics, network activity, and upcoming project developers to better understand the market. 

Then, they also follow news and social media platforms like Reddit, X, or Discord, which gives them a better understanding of market sentiment. When all of this is combined with technical analysis, crypto traders can only maintain significant gains. 

How AlgosOne Helps to Capitalize without Technical Analysis

Let’s be real. While a hybrid approach may sound appealing on paper, it isn’t for everyone because it’s extremely time-consuming and can hijack a trader’s judgment due to FOMO. Moreover, speed is a major factor in making a hybrid approach successful because if a trader isn’t able to spot trends or emerging coins on time, they simply lose out. 

Here’s where AlgosOne comes in. It is a cutting-edge AI-powered trade automation bot that executes trades automatically without human intervention. Its combination of machine learning, real-time adaptability, human expertise, and emotionless trade execution gives it a massive edge. It allows it to execute trades with exceptional accuracy after finding the right cryptocurrency to invest in and leveraging technical analysis.

AlgosOne: Utilizing Automated Hybrid Trading Approach in Crypto

AlgosOne’s hybrid approach utilizes technical analysis, risk management, 24/7 market monitoring, and human oversight. It is worth noting that AlgosOne offers an institutional-grade tool at a fraction; users only need $300 to get started. 

Here’s how AlgosOne successfully uses a hybrid trading approach: 

1. Scans the Market 

Firstly, AlgosOne’s trading bot scans the market 24/7 and analyzes vast amounts of data from various sources, including news, social media, earnings calls, economic data (such as GDP growth, inflation, and consumer sentiment), whale movement, network activity, and geopolitical events. 

2. Finds Opportunity

The bot then shortlists high-potential cryptocurrencies and uses numerous technical indicators, such as RSI, MACD, Support/Resistance levels, and Candlesticks, to spot the right time to execute a trade. 

3. Trades with Risk Management

With automated risk management, AlgosOne places a trade the moment everything aligns. Automated risk management includes oversight of human experts, stop/loss & take/profit orders, and using no more than 10% of a user’s capital on a single trade. 

4. Successful Results

Through careful trades, AlgosOne can successfully grow the user’s capital. This is why AlgosOne offers a fixed Annual Percentage Yield (APY) of over 150%.

Conclusion

While technical analysis remains a valuable tool for trading cryptocurrencies, its effectiveness depends on market conditions, the trader’s experience, and how it is applied. The best approach is a hybrid one, meaning technical analysis doesn’t work in isolation but requires a lot of work and experience on the trader’s end to be successful. 

With AlgosOne, users do not have to worry. Its automated combination of technical analysis, fundamental analysis, and 24/7 market oversight allows it to execute trades with extreme precision. 

If you’re looking to grow your portfolio without the hassle of conducting technical analysis, don’t forget to sign up for AlgosOne today.