Every crypto investor must understand some fundamental analysis basics before getting involved in the cryptocurrency market. In the cryptocurrency market, there are basically two types of analysis we need to know – fundamental analysis and technical analysis.
While fundamental analysis has to do with the worth of a digital currency based on some variables like project, team, ratings on reputable ICO review platforms, technical analysis is simply a trading tool employed to evaluate tokens and digital currencies in a bid to verify opportunities by undertaking thorough analysis of market pricing factors using charts or trends.
In this article, we shall be dwelling on fundamental analysis and its relevance in the cryptocurrency market.
What is fundamental analysis?
The first step in carrying out fundamental analysis of a cryptocurrency is to look into the team behind the project and evaluate the company’s goals and business plan side by side with their technical experience. If the team is experienced and sound enough, the next stop will be to analyze their roadmap and see if it is practicable and realistic.
Furthermore, a thorough analysis on their proposed platform, on which they hope to build their ecosystem on, should be properly analyzed. Understanding the technology behind the cryptocurrency and their whitepaper is also vital in the process of carrying out the fundamental analysis of a particular cryptocurrency.
If a particular token is solving a problem, then it’s good to know the technology behind it and how it works.
Why fundamental analysis is crucial in the cryptocurrency market.
Before investing at all, decide within yourself if you are going short or long term based on how highly you rate a particular token or coin. The summary about carrying out fundamental analysis on a particular cryptocurrency is that it gives a form of cushion against sudden loss of investment. You don’t get to jump into the cryptocurrency market without knowing what is involved.
For those who may wish to key into the Solarex Project, there is still opportunity to do just that.
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