Crypto Trading Crypto Trading Market Analysis

Question 1

What does the Relative Strength Index (RSI) measure in crypto trading?

Accepted Answer

The speed and magnitude of recent price changes to identify overbought or oversold conditions

Answer

RSI is a momentum oscillator that measures the speed and magnitude of price changes on a scale of 0–100 to flag overbought (>70) or oversold (<30) conditions.

Question 2

In technical analysis, what is a 'death cross'?

Accepted Answer

When the 50-day moving average crosses below the 200-day moving average

Answer

A death cross occurs when the 50-day MA crosses below the 200-day MA, signaling a potential long-term bearish trend.

Question 3

What does 'on-chain analysis' refer to in crypto trading?

Accepted Answer

Examining blockchain transaction data to gauge market sentiment and investor behavior

Answer

On-chain analysis examines publicly available blockchain data—such as wallet flows and exchange inflows—to assess market health and investor behavior.

Question 4

Which indicator measures the difference between two exponential moving averages?

Accepted Answer

MACD (Moving Average Convergence Divergence)

Answer

MACD is calculated by subtracting the 26-period EMA from the 12-period EMA, with a 9-period signal line plotted on top.

Question 5

What is the significance of a high Bitcoin Dominance percentage?

Accepted Answer

A larger share of total crypto market cap is held in Bitcoin, often indicating risk-off sentiment

Answer

High Bitcoin Dominance means BTC holds a large share of total market cap, which often signals traders are moving funds out of altcoins into the safer BTC during uncertainty.

Crypto Trading Practice Test

Crypto Trading Practice Test

Crypto Trading Crypto Trading Market Analysis