Hello, good day everyone, I am here to present my homework post on price forecasting after the good lecture by @stream4u .I just started taking part in crypto Academy this season (season 2).However I have learnt alot about crypto from lecturers and professor on this platform. I would like to acknowledge @njaywan for helping me understand the relevance of the crypto Academy community. So without wasting much time,my homework task would commence. Today the big question is "price forecasting ".

WHAT IS PRICE FORECASTING

In the crypto world, when we say price forecasting, it basically means predicting the future of the cryptocurrency. Price forecasting however depends of a lot of factors such as the seasonal trends,the demand rate,the uses etc.

Price forecasting is factored mostly on supply and demand. Whenever a trader or an investor set a price, the outcome depends on the supply and demand. Good price forecasters make good use of the informations provided and use it to thier advantage in making profits.

Let's talk about how price forecasting is needed

As we all know, crypto tradings and investments is currently one of the best way for anyone to invest money. Over the years recently, the cryptos are being accepted and promoted by peoples and companies over the world. Cryptos are accepted as payments methods and used for transactions in part of the world currently. These has reduced the risk in investing in cryptos and made crypto investments one of the most reliable way of making money.

Over the years, people have made some decent profits in crypto investments. However to invest in the cryptos, a trader or an investor need the price forecasting to maximise profit and reduce loss as well. Price forecasting helps a trader in both long-term investment and short-term investments as well. Most of the long term investment in the crypto world nowadays are very easy to predict since the prices of the top 20 crypto currencies over the years has increased. However price forecasting would make an investor or a trader choose the right coin for the best profit gains.

However, the most relevant use of price forecasting is for the traders (the short term trading). Experts for different parts of the world make a lot of profit daily from crypto tradings by the help of the price forecasting. Without price forecasting , predictions would sorely depend on luck. As we all know, making money based on luck is not the best way anyone would like to invest. With price forecasting, one would know the time to invest and time not to invest. Within minutes and hours, a good price forecaster can make 80% and above trade wins.

Best Methods For Price Forecasting

In price forecasting, there are so many criterias traders and investors use in their predictions before they invest.

• Technical Analysis: with this type of price forecasting, traders consider alot of factors such as the market trends,price movements, charts patterns etc. Talking of the market trends, usually the currency in high demands in the market at a particular time trends the most and as a results cause the currency to rise more since the demand has increased. Looking at the chart patterns, some curves looks very regular from the chart which makes forecasting very easy to predict. Some experts predicts the future prices by just studing the charts for some periods. Technical Analysis is one of the best way a price forecasters could use for forecasting. However, Knowledge and enquiries from experts is recommended when using technical analysis.

• Fundamental Analysis : Unlike the technical analysis where traders consider the market trends and the chart patterns, fundamental analysis looks beyond. With this type,traders consider how the company's management about the assets are being managed. Traders usually check about what they are doing to improve,whether they are implementing new products, the company's profits and loss at the end of each months etc. If it meets their requirements, they go ahead to invest knowing there is a potential of gaining. For the fundamental analysis, a crypto can be newly introduced, but looking at the uses and companies potentials,people take the risk to invest knowing there's a chance of booming in the future. Fundamental Analysis is one of the best criteria to use.

• Sedimental Analysis: This is the most critical of all. This method could be the fastest way to earn in minutes and could also be the fastest wat to lose as well. In this type,traders makes predictions in a short time and either earn or lose. This method is usually used by experts in the fields. If this method is mastered, it could be the best way to earn. But however, the risk in using this method as an amateur is very high and not recommend for beginner without experts guides.

Looking at the 3 types of forecasting, any of them could be the best depending on the traders aim at the end.

Predicting the price of the litecoin

figure 1

Coinmarketcap.com

The chart above is how the litecoin has is altered from the past 3 months. So from the chart above, the litecoin has increased by 96.9% over just 3 months meaning the litecoin can yield almost a 100% profit over 3 months of investments. Since the litecoin can yield a 100% profit in 3 months, we can assume that investing in litecoin over a long period of time would yield profit.

figure 2

Coinmarketcap.com

Looking at this 2rd chart, you could see that, the curve of the graph is regular. Thus, the gradient of the curve at any two points would be similarly to one another. The 2nd chart proves the first chart in the sense that, the percentage increase in figure 2 is 38% per month. Looking at the charts and per my predictions, litecoin would rise to about 30% of it value monthly.

Figure 3.

Coinmarketcap.com

From the figure 3, we could see from the graph that,the price has decreased in the first 7 days. Therfore,from this graph alone, we can't predict the price of the litecoin in the next 7 days. However, comparing the figure 2 and figure 3, we can confidently predict that the price in the next 7 days would rise based on the assumption that the price would rise to about 30% montly.

conclusion

From the charts, we have noticed that traders who invest in long term investment yield profits at the end of every year. The risk of losing in a long term investment is very low. Price forecasting makes it easier for one to invest at a very low risk.