INTRODUCTION

Thanks to crypto academy for organizing this informative course for us to learn and also share our view in the form of homework. This is the first time, I am participating in the lecture and homeworks even though, I most come around and learn from the professors and my colleague who mostly join in the homework. This week work from professor @stream4u focuses on price forecasting, it's importance or need, best methods and we will be looking at one cryptocurrency GRAPH and predict the future price.

Definition:

• Price forecasting is basically a way of predicting the price of commodities, product or service by evaluating various factors such as characteristics, demand, seasonal trends and the price of other commodities.
  When we talk about the service, we may be talking about crypto currency and it's assert on the market and how these numerous methods and knowledge can be used to predict the value or price in the short or long term.

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Price Forecasting is very important in business and investment. Every potential investor or business man wants to earn hight dividend or profit on his or investments. This in a way is going to help the individual make an informed choice as to where and how to invest.

• THE NEED FOR PRICE FORECASTING

1. It helps avoid lost of investment: Any rational human being who wants enter into business has profit at the back of his mind so knowing price forecast in this case, trading in crypto, it will enable the person to know when to invest and when not to invest or cash out your investment to avoid a reduction in your investment.

2. It leads an increase in potential earnings: profit margins in terms of investment will increase because with price forecast mechanisms, the investor will be able to invest more at a higher level and decide not to invest or invest less at a lower price level. Like I said any rational business man wants more profit on his investments.

3. It may lead to higher savings: When price goes down most people will opt to save their money rather than put them in a business that wouldn't yield anything.

4. It may lead to an increase or decrease in a customer or consumers demand. With the concept of demand and supply. the higher the price the lower the quantity demanded and the lower the price the higher the quantity demand. And the higher the price the higher the quantity supplied and the lower the price the lower the quantity supplied. In this scenario, when profit levels are high, it will lead to higher investment and vice versa

5. Price forecasting brings a lot of confidence in doing business. It saves time on the type of business to do and where to do business as a business man.

Methods of Price Forecasting

Technical Analysis

• Technical analysts use different procedures, including charts and indicators such as volume, distribution line, Aroon indicator, average directional index, and others. One of the main principles is the repetition of history. Analysis is based on the principle that, market action is the most important factor.

Price movement is the other factor. Analysts has the assumption that prices tend to move in trends. They mostly move up, and down. Based on these assumptions, technical analysis can be applied to different instruments, including futures stocks and others.

Traders studies and identify downwards and upwards trend and how they unfold in time. They then base on charts to assess movements in asset prices. There are two types of charts used short-term and long-term charts

Fundamental Analysis

• Fundamental analysis technique is based on historical accounting information that can predict stock returns. The goal is to show that historical financial signals can shift the distribution of returns earned by an investor or trader by making a disparity between winners stocks from losers.

It can be shown that historical accounting signals can be used to improve the entire distribution of future returns earned by an investor or trader.

Sentimental Analysis

• Sentiment Analysis make use of various strategies for collecting and analyzing opinions and views about products and services.

Generalisation and decision making we consider opinions of different
persons. This basic fact is also applicable for organizations. Back in the days, there was
no well-defined techniques for opinion mining.
In those days when any person intends to make decision used to collect views manually form friends and family.

Similarly when any organization wanted to make decision about production used to conduct survey manually.

With the help of surveys, organizations used to get opinions or views of various
customers.
However, with the growth of social media contents and E-commerce in the past
few years, the way of decision making has been changed completely.

Currently, there are applications and websites that provides the platform for people to post their reviews about products
online. Social media websites, blogs are the now the primary sources for sharing views and comments.

We used sentiment analysis in stock
market prediction, predicting the prices of the stock is very crucial. It is useful in deciding
whether to buy the shares or sell them with the aim.of makingprofit.
Social media acts as a platform to view the reviews of the customers and apply workable strategic decisions whenever needed.

Some applications of sentiment analysis.

• Social Media Monitoring
• Customer Service
• Market Research
• Intelligent Transportation System
• Online advertising

Chart about the current price of steem

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From the table, chart or graph above, we can predict that in the next few weeks steem is going to hit $1 and in some years to come, we estimate steem be around $6 and above