How to Master the Art of Crypto Price Prediction – Alluva
It is no secret that whether you’re a short term trader or long term investor, being able to predict where markets are headed can be extremely beneficial to your financial position. Price prediction is a highly sought after skill because it affords traders more knowledge about potential returns on investments, while ensuring that they do not expose themselves to unwanted or unnecessary risks.
The general trends and price movements of equity and stock markets are well-documented, thanks to the decades worth of pricing and volume data available for public use. In contrast, the cryptocurrency ecosystem is a lot younger and driven almost entirely by the market dynamics of public supply and demand. Digital currencies can sometimes also exhibit price volatility, gaining or losing up to 30% of their value within a single day.
Even with these risks though, traders have been able to profit immensely from the cryptocurrency market. CoinMarketCap estimates that a whopping $50-$100 billion worth of cryptocurrency is traded every single day on various exchanges around the world. Given that the cryptocurrency trading scene is highly competitive, let’s take a look at some factors that can help you profit and stay ahead of the curve.
Historic Data
Similar to the stock market, cryptocurrencies can exhibit recurring trends over the short and long-term. Many traders leverage past pricing data to verify or influence their predictions, with some technically-inclined individuals even developing their own trading bots for high frequency, algorithmic trading on exchanges.
However, training a neural network is perhaps the most cutting edge way of leveraging existing data to predict the future prices of various cryptocurrencies.
Before a neural network can be trained though, you will need to obtain historical price data for
the cryptocurrency of your choice. Certain data providers, including CoinMarketCap, offer limited access to their API for free, while others simply provide a CSV file that you can download from a browser directly. Do note that you may be limited to a certain number of API calls per month on the free plan, requiring a subscription to the data provider.
Once your dataset is ready, you can experiment with multiple neural network training methods to develop an accurate model capable of predicting where the market is headed. We recommend checking out this blog post from Towards Data Science for a practical demonstration of the technology’s potential.
Regulations
Regulations and laws passed by governments around the world can have a major impact on cryptocurrency prices. In September 2017, the market entered a state of freefall after rumors suggested that China would soon ban crypto exchanges altogether. At the time, China was one of the biggest markets for Bitcoin and other tokens, alongside Korea and other South Asian countries.
Positive regulation can also influence the direction and momentum of the cryptocurrency market. In June 2017, for instance, investment banking company Morgan Stanley stated that Bitcoin’s price would appreciate rapidly once the US government laid down concrete regulation. Within a few short months of that statement, the US Securities and Exchange Commission classified digital currencies as ‘securities’, and imposed strict regulation on Initial Coin Offerings (ICOs). This move likely legitimized the cryptocurrency industry, boosting it to a market cap of $0.7 trillion by the end of the year.
Technical Analysis
Traders have been using indicators and charting patterns to forecast and analyze the prices of a wide variety of tradable instruments for almost half a century. This discipline, which largely relies on statistics and probability, is commonly referred to as technical analysis.
Whether you’re performing technical analysis in the crypto or equity markets, there are multiple indicators that you can leverage, including trendlines, channels, moving averages, and support and resistance levels. This strategy allows traders to make better predictions and profit in bull and bear markets alike. If you’re new to technical analysis or lack experience, Investopedia offers a comprehensive list of reputed technical analysis courses for various skill levels.
Public Sentiment
As previously stated, the cryptocurrency market is driven by the basic economic principle of supply and demand, similar to precious metals and a handful of other asset classes. In certain countries where citizens may turn to Bitcoin as an emergency currency (as already seen in the case of some economies), prices tend to appreciate rapidly as traditional exchanges may no longer offer sufficient liquidity or flexibility. The South African reported that traders in Zimbabwe asked individuals to pay as much as $75,000 per Bitcoin token, owing to increased local demand and limited supply.
While public sentiment may be somewhat predictable with the prominence of social media and online discussion platforms like Reddit, investing with this information alone can still be a risky endeavor. Furthermore, if you do not already have some experience with day trading, statistics, and computer science, competing with more experienced traders could be detrimental to your financial position in the short term.
Alluva, on the other hand, is a free web app that provides cryptocurrency users with a stress-free environment to predict cryptocurrency prices and earn big rewards. Unlike trading tokens on an exchange, Alluva does not require users to have any technical expertise or make upfront investments. Users that consistently predict the price of cryptocurrencies accurately are rewarded in the form of Alluva tokens (ALV) that can be traded on supported crypto exchanges or redeemed for products and services on partner websites.
To learn more about Alluva’s price prediction platform, click here. For more interesting content on the crypto market, stay tuned to our Medium channel here. If you have any questions regarding Alluva, we’d love to answer them in our Telegram group here.
Published at Wed, 14 Aug 2019 07:31:56 +0000
Bitcoin Pic Of The Moment
Etherium Meetup Hong Kong organized by Jehan Chu.
Vitalik Buterin test codes (illustrates) one of the features of Caring Currency using Etherium.
Photo: Philip McMaster, Caring Currency – World Sustainability Project
www.CaringCurrency.com
www.RepublicOfConscience.com
www.WorldSustainability.Org
By Philip McMaster PeacePlusOne_!/ on 2014-06-26 19:58:41
