5 kinds of research a first-time Bitcoin trader needs to do

April 19, 2023 05:38 PM AEST | By Arisha Tariq (Guest)
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If you want to test the waters in Bitcoin trading, you've taken the first step! If you're considering investing in digital currency, we've detailed the five types of investigation you should do first. Have a cup of coffee with me as we look at Bitcoin.

1. Fundamental Research

One of the most significant sorts of study you can do as a new Bitcoin trader is fundamental analysis. The entire survey of Bitcoin aims to uncover the proper drivers of its price, including supply and demand, the regulatory landscape, and technical advancements.

Supply and Demand

The number of Bitcoins in circulation will always be at most 21 million, and their annual creation will decrease by half every four years. Bitcoin's scarcity makes it a deflationary asset, meaning its value might rise as demand outstrips supply. Tracking Bitcoin's supply and demand movements is crucial to grasp its value proposition.

The blockchain explorer is a public database that records all Bitcoin transactions, allowing you to keep tabs on the currency's supply. One may glean insights regarding Bitcoin's demand from examining transaction volume and the number of active addresses on the blockchain.

Regulatory Environment

Bitcoin's worth is also affected by the regulatory climate. Depending on the country, bitcoin regulation takes several forms, from complete prohibition to cautious encouragement.

If you're just getting started trading Bitcoins, you must keep up with legislative changes in your nation and other countries where Bitcoin is widely used. You may learn how governments regard Bitcoin and how their policies can affect its value by watching news stories, regulatory pronouncements, and public comments from government agencies.

Technological Developments

Finally, you should follow the progress of Bitcoin-related technology closely. The blockchain and all Bitcoin transactions are encrypted and protected by a decentralized, peer-to-peer network.

As a result, Bitcoin's worth may be significantly altered by changes to the underlying technology. Bitcoin's user base may grow with the help of the Lightning Network, a layer-two scaling solution that aims to increase transaction throughput and minimize costs.

2. Technical Analysis

New Bitcoin traders may benefit from both fundamental and technical analysis. To forecast future price changes, technical analysts examine historical data on both volume and price.

Candlestick Charts

Popular in technical analysis, candlestick charts illustrate price action across short time frames of one day or one hour. The candlestick's body symbolizes the opening and closing prices, while the wicks reflect the highest and lowest prices that occurred within the period represented by the candlestick.

Moving Averages

Technical analysis also often makes use of moving averages. Bitcoin's average price over a specific period, say 50 or 200 days, is represented by a line known as a moving average. You can spot trends and support/resistance levels by charting numerous moving averages on a chart.

For instance, it is generally considered bullish when the price of Bitcoin rises over the 50-day moving average, suggesting that more gains are probable.

Relative Strength Index (RSI)

This indicator calculates how much the current Bitcoin price differs from its recent average. Overbought situations are indicated by RSI readings over 70, while oversold readings below 30. By keeping an eye on the RSI, you can anticipate when the price of Bitcoin will likely make a U-turn, providing you a chance to purchase or sell.

3. Market Sentiment Analysis

First-time Bitcoin traders might benefit from another sort of market research—market sentiment analysis—by better comprehending the prevailing market attitude. "Market sentiment" refers to how investors generally sense a specific asset or market.

Social Media Analysis

Monitoring social media sites like Twitter, Reddit, and Telegram may provide insight into the market mood. One may glean insights on investor sentiment towards Bitcoin from such platforms.

Keeping an eye on social media helps you spot fraudulent schemes that might alter the market's mood.

News Analysis

Observing Bitcoin-related coverage in the news and financial press is another helpful technique for gauging market mood. News events, including regulatory changes, economic data, and company announcements, may significantly influence Bitcoin's price and market sentiment.

A more significant grasp of the variables influencing Bitcoin's value may be gained by keeping up with the latest news and events, allowing for more educated trading choices.

Sentiment Indicators

You may also use the general attitude of the market towards Bitcoin by consulting several accessible sentiment indicators. Using a scale from 0 to 100, the anxiety and Greed Index quantifies how investors feel about Bitcoin. Values below 20 indicate severe pressure, while over 80 indicate excessive greed.

Other indications of market mood include Google Trends, which measures the frequency with which users search for terms linked to Bitcoin, and the Crypto Fear and Greed Over Time chart, which historically illustrates the market's emotional swings.

4. Risk Management

Those venturing into Bitcoin trading for the first time should educate themselves on the risks and take measures to protect themselves. Some methods for minimizing danger are outlined below.

Set Stop-Loss Orders

Stop-loss orders are instructions sent to a broker to sell Bitcoin at a predetermined price. Potentially useful for limiting losses if the cost of Bitcoin goes below a certain threshold. Stop-loss orders can limit losses and keep emotions out of trading choices.

Use Leverage Wisely

Bitcoin trading using leverage may magnify profits but also increase loss exposure. Use caution and spend only what you can lose while using force.

Keep Up-to-Date with Regulations

Many nations have laws against unlicensed Bitcoin trading, so keeping tabs on any new laws that might disrupt the market is crucial. If you stay on top of regulatory developments, you can prepare for their possible effects on the market and make more profitable trades.

Take Breaks

Trading is vital to take vacations from Bitcoin now and then to prevent burnout. Take a break if you need time from trading to gather your thoughts.

You may safeguard your money and reduce the likelihood of suffering losses by using risk management strategies. Risk management is essential to effective trading, and it is necessary to remember that there are no guarantees in Bitcoin trading.

5. Trading Platform Selection

Choosing the right trading platform is crucial for those just starting Bitcoin trading. When deciding on a trading platform, it is essential to keep in mind the following:


When exchanging Bitcoin, safety is of paramount importance. Check that the platform you're considering employs at least the minimum level of security your business requires, such as two-factor authentication, SSL encryption, and cold storage for cash.

You should also look at the platform's track record for security issues and hacks.

Interface for Users

Making transactions and keeping track of your portfolio may be simplified by using a trading platform with an intuitive UI. Try to find a system that one can access with little effort.


Deposit and withdrawal fees, trading, and fund management costs are all examples of fees expected to be charged by a trading platform. Shop around for the best pricing by comparing the many available outlets.


The market for Bitcoin trading operates around the clock, so it's crucial to choose a service that's accessible whenever you need it. Select a service that guarantees uptime and has helpful customer service reps.

Finance Equipment

Charting and analysis tools, news feeds, and trading bots are just a few of the tools and features available on today's various trading platforms. Think about the resources and functions you'll need most, and look for those in the forum you choose.


A reliable trading platform will have a solid reputation. You should examine reviews and comments from other traders to choose a platform that meets your needs.

Considering these will allow you to settle on a Bitcoin Era like trading platform that works best for you. You could also test a new trading platform with a first investment to ensure it meets your expectations.


In sum, individuals that put in the time and effort to learn about the market and have a thorough understanding of Bitcoin trading have a good chance of seeing a positive return on their investment. First-time traders may improve their chances of success by using fundamental and technical analysis, a study of market sentiment, risk management, and selection of the appropriate trading platform.

Remember that Bitcoin is traded in a highly volatile market where one cannot assure profits. But if you stick to these guidelines and keep learning about the market, you can become a Bitcoin trading expert.


Risk Disclosure: Trading in cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory, or political events. The laws that apply to crypto products (and how a particular crypto product is regulated) may change. Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading in the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed. Kalkine Media cannot and does not represent or guarantee that any of the information/data available here is accurate, reliable, current, complete or appropriate for your needs. Kalkine Media will not accept liability for any loss or damage as a result of your trading or your reliance on the information shared on this website.


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