Bitcoin neural network analysis week 20/2018: Anything goes

in #bitcoin6 years ago

Analysis of past week:
For the last week the network did predict a slow but steady growth. The opposite was the case. The week started with a slow decline, going into a rapid crash after the news of korean exchanges being raided and fud around some MtGOX bitcoins. Interestingly the previous network analysis of week 18 Clouds on the Horizon did already foresee a coming pullback but the week 19 analysis had removed the pullback due to a better than expected recovery.

Since the network prediction was far off, this week the network strategy was suboptimal.

I am comparing three strategies, first hold fiat and make a small profit elsewhere, hold bitcoin or follow the network predictions. For last week due to the neutral forecast this meant exposure to fiat by a very small margin. Since I started documenting my predictions on the blockchain these strategies compare as

Starting capital: 11497.40$
Fiat with a weekly profit of 0.5%: 12095.63$ (up 0.5 %)
Holding BTC: 8723.94$ (down 9.6%)
Network strategy: 9781.56$ (down 9.6%)

The fiat strategy is up since most of the documented time has been a bear market, but the neural network has gained an advantage over btc.

Forecast:
download (11).png
Red areas are predicted below the current price, blue/yellow areas indicate the expected passive growth, green areas are better than the expected growth. The vertical black line is one week into the future. The network prediction is smooth as the random noise is filtered out.

The network forecast for the upcoming week is rather unstable. This means that given the past data there are many future outcomes and there are no clear signs for either growth or decline. The network predicts a very mixed future with a target of 8770.12$ this week.

Also in the long run the network expects an unstable future with neither clear growth not clear decline.

Averaging out the statistical fluctuations the network very slightly prefers bitcoin over fiat with a 0.5% growth. So my strategy for the coming week is to hold bitcoin.

This post is not financial advice! I am testing the potential to use neural networks for price predictions and am documenting my results on the blockchain to have provable public results. All prices are based on 0:00 UTC for consistency!

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