Learn

Understand the market before you move in it.

Start with the basics, then learn to read the indicators traders use on their charts.

Crypto basics

6 short lessons, in order.

    • Transactions are grouped into blocks and chained together in order.
    • Thousands of computers keep a copy, so the history is hard to change.
    • Anyone can read it; that's what makes on-chain analysis possible.

    Knowledge check

    What makes a blockchain a shared record?

    Choose an answer for each question.

Signal library

Learn to read the market, one signal at a time.

Plain-language guides to chart patterns, candlesticks, indicators and derivatives signals, with a note on how Compass Alpha uses each one.

Showing 26 of 26 signals

Chart patternsBeginner

Accumulation base

Price moves sideways in a tight range for weeks while volume quietly builds.

Chart patternsBeginner

Breakout

Price pushes through a level it failed to cross before (resistance).

Chart patternsIntermediate

Bull flag

A sharp rise (the pole), then a short, slightly downward drift (the flag) on lower volume.

Chart patternsIntermediate

Double bottom

Price falls to a low, bounces, then returns to the same low and holds.

Chart patternsIntermediate

Head and shoulders

Three peaks, the middle one highest, with a line (the neckline) joining the dips between them.

Chart patternsIntermediate

Volatility squeeze

Price swings narrow into a tight range.

CandlesticksBeginner

Doji

A candle whose open and close are almost equal, leaving a very small body.

CandlesticksBeginner

Hammer

A small body near the top with a long lower wick, at least about twice the body.

CandlesticksBeginner

Shooting star

A small body near the bottom with a long upper wick.

CandlesticksIntermediate

Bullish engulfing

A small down candle followed by a larger up candle whose body covers the previous one.

CandlesticksIntermediate

Bearish engulfing

A small up candle followed by a larger down candle whose body covers the previous one.

CandlesticksIntermediate

Morning star

Three candles: a large down candle, a small indecisive candle, then a large up candle.

IndicatorsBeginner

Moving averages

The average closing price over a set number of days, drawn as a smooth line (for example 20 or 50 days).

IndicatorsIntermediate

RSI (Relative Strength Index)

A 0 to 100 measure of how strong recent gains are compared with recent losses.

IndicatorsIntermediate

MACD

Moving Average Convergence Divergence: the gap between a fast and a slow average, with a signal line.

IndicatorsIntermediate

Bollinger Bands

A moving average with bands two standard deviations above and below.

IndicatorsBeginner

Volume

How much of an asset changed hands in a period.

DerivativesIntermediate

Funding rate

A periodic fee between long and short traders on perpetual futures.

DerivativesIntermediate

Open interest

The total value of open futures contracts.

DerivativesAdvanced

Liquidations

Forced closing of leveraged positions when losses get too large.

Risk managementBeginner

Position sizing

Deciding how much to put in a single trade or asset.

Risk managementBeginner

Stop-loss

A price where you exit to limit a loss.

On-chainIntermediate

Exchange flows

Coins moving into or out of exchange wallets.

On-chainBeginner

Active addresses

The number of unique addresses using a network each day.

Market basicsBeginner

Market cap

Price multiplied by the number of coins in circulation.

Market basicsBeginner

Support and resistance

Price levels where buying or selling has repeatedly shown up.

Chart indicators quiz

Does an RSI above 70 guarantee that price will fall?
What does a moving average primarily do?
What should you consider before trusting a chart pattern?

Choose an answer for each question.

Compass Alpha

Compass Alpha provides information and tools, not financial advice. Crypto assets are volatile and you can lose money. Sample values on this page are illustrative.