If you’re new to the world of digital currencies (or you’re not) and you don’t understand how to read a crypto depth chart, then we’re here to help. The first thing you’ll need to do is buy some bitcoin or maybe your favorite altcoin like Litecoin or Ether.
Once you have your preferred currency, you can move right into trading on platforms like Binance, Kraken, and Coinbase Pro. On these exchanges, you’ll see various charts and graphs showing the history of orders, bar charts, candlesticks, and depth charts.
A depth chart is a tool which shows you what you need to know regarding supply and demand. With it, you can see a visual representation of the supply and demand of a specific digital asset, assuming you know how to read it. Here is a quick summary to help.
Man standing with his arms raised in question.
Green Lines vs. Red Lines
You’ll notice two lines on a depth chart. These are the bid and ask lines. More often than not, an exchange will show bid orders, or buy orders, as a green line and the ask orders, or sell orders, as a red one.
The lines on the chart are created through the use of plotting dots. Each dot on the depth chart shows how much you can trade at a given point. Continue reading…