Charts by TradingView
Last updated
Last updated
ALPHA, the decentralized perpetual derivatives platform by THENA, proudly utilizes TradingView as our chart provider. Below is a comprehensive guide on navigating TradingView charts to enhance your trading experience.
In this guide, we will provide a basic introduction to using TradingView charts. You will learn how to view different time frames, select various chart types, compare different tickers, use indicators, reset charts, utilize drawing tools, as well as taking a snapshot of your graph.
Firstly, in the top left section, you'll find the time frame selection. The time frame determines the length of time each bar or candlestick represents on the chart. For example, a 1-hour time frame means each bar represents one hour of trading activity. We'll use the BTC/USD chart as an example.
Time frames play a crucial role in understanding market movements. Short-term time frames, such as 1-minute or 5-minute charts, are ideal for day traders looking to capitalize on quick, intra-day price fluctuations. Medium-term time frames, like the 1-hour or 4-hour charts, suit swing traders who hold positions for several days to weeks. Long-term time frames, such as daily, weekly, or monthly charts, are best for investors focused on long-term trends and holding positions for months or years. Choosing the right time frame depends on your trading style and strategy. If you are a day trader, short-term charts will be more useful, while long-term investors will benefit from longer time frames. Combining multiple time frames can provide a more comprehensive view of the market, allowing traders to see both the broader trend and finer details for better decision-making.
You can "favorite" your favorite time frames by clicking on the star symbol, which pins them for easier selection next time. This feature allows you to quickly access the time frames you use most frequently.
Beside the time frame section, you can select the chart types. Popular chart types include line charts, bar charts, and candlestick charts.
Different chart types are used to provide various perspectives on price movements, helping traders make informed decisions. For example, a line chart, which connects closing prices over a period, is simple and easy to read, making it great for identifying overall trends. However, it lacks detail on price fluctuations within the selected time frame. In contrast, candlestick charts offer more information, showing opening, closing, high, and low prices for each period, but they can be more complex to interpret. Selecting the appropriate chart type is essential for tailoring your analysis to your trading strategy.
To change our hollow bar chart to a line chart, we simply select the corresponding chart type in our dropdown menu.
Beside the chart type section, there is an option to add multiple charts on a single graph. This allows traders to compare different assets simultaneously, providing insights into their relative strength and correlations.
For instance, we could add the ETH Chart besides the BTC chart.
This comparison helps identify which asset is stronger or weaker. Observing relative strength can indicate bullish or bearish trends. From this chart, we could make the inference that Ethereum is showing relative weakness to Bitcoin, while at the same time being correlated to Bitcoin, and could suggest it does not offer much diversification for a risk sensitive investor. Overall, comparing symbols helps to identify relative strength, correlations, and trends, aiding in decision-making and portfolio management.
TradingView on ALPHA offers a myriad of indicators to enhance your trading analysis. Indicators are tools that help traders interpret price movements and predict future trends. Free users of TradingView can use up to 2 indicators on the chart Some of the more popular indicators are:
Moving Average (MA): This indicator smooths out price data to identify the direction of the trend over a specific period, helping traders to spot trends and reversals.
For example, this graph uses 2 Simple Moving Averages, 50 days (blue) and 200 days (Yellow) on the daily chart.
The 50-day SMA represents the short-term trend, while the 200-day SMA reflects the long-term trend.
When the short-term SMA (50-day) crosses above the long-term SMA (200-day), it could suggest a bullish signal, indicating potential upward momentum. Conversely, when the short-term SMA crosses below the long-term SMA, it suggests a bearish signal, indicating potential downward momentum. This crossover strategy helps traders identify trend reversals and make informed trading decisions.
You can change the time period as well as the style of the Moving Averages by hovering near the indicators and clicking the settings icon.
Relative Strength Index (RSI): RSI measures the speed and change of price movements, indicating overbought or oversold conditions, which can signal potential reversals.
The RSI is displayed below the main price chart. The default RSI overbought and oversold levels are typically set at 70 and 30, respectively. However, these levels can be adjusted based on the trader's preference or the specific characteristics of the asset being analyzed. The RSI helps traders identify potential reversal points. For instance, when the RSI crosses above 70, it might signal that the asset is overbought and a bearish reversal could be imminent. Conversely, when the RSI crosses below 30, it might indicate that the asset is oversold and a bullish reversal could be expected. This makes the RSI a valuable tool for timing entry and exit points in trading strategies.
3. Bollinger Bands: This indicator consists of a middle band (a moving average) and two outer bands that represent standard deviations. Bollinger Bands help traders identify volatility and potential price breakouts.
To delete indicators, simply hover your mouse near the indicators section and click the “trash can” icon that appears.
To reset the chart to the default scale, you can click at the settings button at the bottom right and then select “Reset price scale”. Alternatively, you can press ‘Alt + R’ to reset the price scale.
To get a clean new chart, you can simply refresh the whole page.
TradingView offers the ability to draw freely on your chart or use pre-drawn tools like Fibonacci retracements. These tools, found on the left side of the chart, help traders annotate and analyze price movements by highlighting trends and identifying key support and resistance levels.
On ALPHA’s TradingView charts, you can find 11 drawing tools from top to bottom.
Some of the more popular ones include:
Trend Line Tool: Trend lines enable you to highlight the direction of movement and significant price levels.
The Trend Line tool on TradingView allows you to draw lines to mark the direction of price movements and significant levels. By selecting the tool and clicking to set start and end points, you can easily create trend lines that help identify market direction, support, and resistance levels. This tool is useful for spotting trends, potential breakout points, and reversals, enhancing your technical analysis and trading strategy. Gann and Fibonacci Tools: These tools automatically create levels based on Fibonacci sequences and Gann theory.
The Fibonacci Retracement tool on TradingView allows traders to quickly and easily draw key levels on a chart with just a few clicks and drags. By selecting the tool and then clicking on the start and end points of a significant price move, the tool automatically plots the Fibonacci levels. These levels help traders identify potential areas of support and resistance, making it easier to anticipate possible reversal points in the price action. This automated feature saves time and enhances the precision of technical analysis.
Forecasting and Measurement Tools: These tools help measure chart distances, predict price movements, and assess trading positions.
Forecasting tools on TradingView, such as Long Position and Short Position, allow traders to simulate potential trade scenarios. By selecting these tools and setting entry, stop-loss, and target levels, traders can visualize potential profit and loss, helping them evaluate risk and reward before executing trades.
You can easily adjust your forecasted risk, entry, profit, and stop levels by clicking on the settings icon that appears when you hover your mouse over the forecasting drawing on your chart. This feature allows for precise customization of your trade parameters.
To take a picture of your graph, you can click the camera icon on the upper right corner of the graph, which allows you to either download the image or copy the image to your clipboard.
For a more detailed guide on how to use TradingView charting functions, you can visit their official website.
Disclaimer: This article is a guide on how to use TradingView and does not constitute financial advice. We do not ensure the accuracy of the content.
