Quick Facts
- Chart Type: Click the “Chart Type” dropdown menu and select “Candlestick (BTC)” to divide the chart by Bitcoin.
- Use the “Divide by” dropdown menu to select the cryptocurrency you want to divide by, such as ETH, LTC, or your preferred altcoin.
- Hover over the “Divide by” dropdown menu to see a list of available cryptocurrencies.
- In the “Settings” panel, click the “Divide by” tab and select “Choose a currency” from the dropdown menu.
- Select the cryptocurrency you want to use as the base currency from the list.
- The chart will automatically update to display the price of the selected cryptocurrency divided by the base currency.
- You can adjust the time frame and interval of the chart by clicking the “Time Frame” and “Interval” dropdown menus.
- To reset the chart to its default settings, click the “Reset” button in the “Settings” panel.
- You can also use the “Compare” feature in TradingView to compare the performance of multiple cryptocurrencies divided by Bitcoin.
- Use the “Pin” feature to pin the divided chart to the top of the TradingView window for easy access.
Divide and Conquer: How to Divide Alt Coin Charts by BTC in TradingView
As a trader, I’ve always been fascinated by the world of alt coins. With so many options to choose from, it can be overwhelming to determine which ones are worth trading. That’s why I’ve learned to rely on a crucial tool in my TradingView arsenal: dividing alt coin charts by BTC.
What’s the Big Deal About Dividing by BTC?
You might be wondering why dividing by BTC is such a game-changer. Simply put, it allows you to see the performance of an alt coin relative to Bitcoin. This is essential because Bitcoin is often considered the benchmark for the cryptocurrency market. By dividing by BTC, you can:
- Identify alt coins that are outperforming Bitcoin
- Spot alt coins that are underperforming Bitcoin
- Make more informed trade decisions based on relative performance
Setting Up Your TradingView Chart
Before we dive into the nitty-gritty, let’s get your TradingView chart set up. Follow these steps:
- Create a new chart on TradingView by clicking on the “New Chart” button.
- Type in the ticker symbol of the alt coin you want to analyze (e.g. Ethereum (ETH)).
- Click on the “Indicators” button and select “Divide” from the drop-down menu.
- In the “Divide” window, select “BTCUSD” as the denominator.
The Magic of the Divide Function
Now that you have your chart set up, let’s explore the magic of the divide function. The divide function takes the closing price of your alt coin and divides it by the closing price of Bitcoin. This gives you a ratio that shows how the alt coin is performing relative to Bitcoin.
For example, if the ratio is 0.05, it means that 1 Bitcoin can buy 20 units of the alt coin.
Interpreting the Results
So, what does the ratio tell you? Here are some possible interpretations:
| Ratio | Interpretation |
|---|---|
| < 0.01 | The alt coin is severely underperforming Bitcoin |
| 0.01 – 0.1 | The alt coin is underperforming Bitcoin, but with potential for recovery |
| 0.1 – 1.0 | The alt coin is performing in line with Bitcoin |
| 1.0 – 10.0 | The alt coin is outperforming Bitcoin |
| > 10.0 | The alt coin is severely outperforming Bitcoin |
Real-Life Examples
Let’s take a look at some real-life examples to illustrate how dividing by BTC can be useful.
* Ethereum (ETH): During the 2017 bull run, ETH/BTC hit an all-time high of 0.15. This meant that 1 Bitcoin could buy 6.7 units of Ethereum. As the market corrected, ETH/BTC fell to 0.02, indicating a significant underperformance.
* Litecoin (LTC): In 2019, LTC/BTC surged to 0.02, indicating that Litecoin was outperforming Bitcoin. This was likely due to Litecoin’s pending halving event, which sparked investor interest.
Tips and Tricks
Here are some additional tips to keep in mind when dividing by BTC:
- Use logarithmic scaling: To get a better view of the ratio’s movement, switch to logarithmic scaling on your TradingView chart.
- Combine with other indicators: Divide by BTC can be even more powerful when combined with other technical indicators, such as moving averages or RSI.
- Keep an eye on volatility: Divide by BTC can be sensitive to Bitcoin’s volatility. Keep an eye on Bitcoin’s price movements to ensure you’re not getting false signals.
Frequently Asked Questions:
FAQ: Dividing Alt Coin Charts by BTC in TradingView
Q: Why would I want to divide an alt coin chart by BTC?
Dividing an alt coin chart by BTC (Bitcoin) allows you to see the coin’s performance relative to the dominant cryptocurrency in the market. This can help you identify whether the alt coin is outperforming or underperforming compared to Bitcoin, which can inform your investment decisions.
Q: How do I divide an alt coin chart by BTC in TradingView?
To divide an alt coin chart by BTC in TradingView, follow these steps:
- Navigate to TradingView and open a chart for the alt coin you’re interested in.
- Click on the “Indicator” button in the top toolbar.
- In the “Indicators” window, search for “DIV” and select the “DIV (Division)” indicator.
- In the “DIV” settings, select “BTCUSD” (or your preferred Bitcoin pair) as the second input.
- Click “Apply” to apply the indicator to your chart.
Q: What does the resulting chart show?
The resulting chart will display the alt coin’s price in terms of Bitcoin, rather than in USD or another fiat currency. This allows you to see the coin’s performance relative to Bitcoin, rather than in absolute terms.
Q: Can I use this indicator on other types of charts?
Yes, you can apply the DIV indicator to other types of charts in TradingView, including Renko charts, Heikin Ashi charts, and more. Simply follow the same steps as above to add the indicator to your chart.
Q: How do I customize the appearance of the DIV indicator?
To customize the appearance of the DIV indicator, click on the “Settings” icon ( looks like a small gear) next to the indicator in the top toolbar. From there, you can adjust the color, line style, and other visual settings to your liking.
I hope this helps! Let me know if you have any further questions.
