Steemit Crypto Academy Week 10: Homework Post for Crypto Professor @stream4u | All About Price Forecasting
Hello, Steemians. It's my pleasure to attend another lecture at the Steemit Crypto Academy. The lecture from professor @stream4u was the one I attended this time around, centered on "All About Price Forecasting". The task associated with the lecture will be attended to in this post.
What is Price Forecasting
Price forecasting simply refers to the financial action put in place to predict the future price of an asset. Price forecasting is done by traders in the cryptospace to make a reasonable prediction of the price of an asset in the future within a time frame.
In addition, it's a tool adopted to determine the next price movement of an asset with the aim of entering an investment to make profitable trade decision. Price forecasting isn't about ordinary prediction but a reasonable, and sustainable method must be put in place to accurately execute the process of price forecasting so as to achieve accuracy up to a very high percentage.
Why Is Price Forecasting Needed
This is a very important context to understand, why price forecasting is needed. I would be giving some of the reasons to which price forecasting is greatly important. The list comes below;
- It's a great tool that helps investors in the cryptospace to easily predict the future price of an asset on their watchlist.
- Price forecasting would open the sight of an investor to the price behavior of an asset over time and what it is likely to become in the future.
- Price forecasting allows investors to make a good financial decision on a desired asset they have kept on their watchlist.
- Price forecasting allows investors to open a good position either buy or sell for themselves which would come with high profitability if the price forecasting is accurate.
- It allow investors to have early access to the crypto trade considering the asset history to make a decision of buy or sell before it's evidently bullish or bearish and this opens them to high profit in the cryptospace.
Methods of Price Forecasting
There are three strong methods to carry out price forecasting in the cryptospace and I will attend to each of them under this sub-heading.
Technical Analysis
This is a method of price forecasting used by investors to predict the future price of a crypto asset, in this type of analysis, price prediction is based on the price movement of an asset over time through the asset's chart pattern. On the chart pattern, the analyst would have his/her support and resistance done initially, and carry out proper study to predict the next movement of the asset's price. This is an effective method to carry out price forecasting but the investor must be careful in the process and make the right choice.
Technical analysis- Chart pattern
Fundamental Analysis
This is another method used for price forecasting where the analysis is based on the research and estimation of the current social adoption of the asset, the issuer of the asset, the financial behaviour of the issuer and so on, to check if the project has a great future ahead of it. I mentioned issuer here which means the company that issues a particular crypto asset, fundamental analysis includes checking for the company financial status to see how they are behaving, how active their social platforms are, the plan on the project and proposed future project from them. All these are considered in fundamental analysis to carry out price forecasting.
Sentimental Analysis
Sentimental analysis is a method used in price forecasting to predict the price of an asset in the future. In this method, investors look around to see people's opinion about a particular asset and with this, decisions of investment are made based on other people's reviews about a trending crypto asset that tend to be bullish or bearish such that the investor can make price predictions on that asset and make the decision to buy or sell.
Price forecasting for DOGE/USDT using Technical Analysis
Initially, I have a support which turn to resistance at 0.272 USDT and create buy position at another support 0.269 USDT setting my sell position at the resistance 0.272 USDT. You can see the screenshot of the support <---> resistance and my entry position below.
Support<--->Resistance
Having my buy entry
The price movement of the asset moved up from my entry position and reached my sell position at 0.272 USDT, and even the price rose beyond to around 0.288 USDT which makes the price forecast works perfectly.
Sell target reached
Price rose beyond
This completes a successful price forecasting done through technical analysis which was made achievable using the asset's chart pattern.
Conclusion
Price forecasting is another great tool that is important to crypto investors to predict the future price of an asset to prepare a way for them to enter a profitable investment, and price forecasting has different methods like technical, fundamental and sentimental analysis. Thanks to the crypto professor @stream4u for this wonderful lesson.
Cc: @stream4u
Hi @temitopef
Thank you for joining The Steemit Crypto Academy Courses and participated in the Week 10 Homework Task.
Your Week 10 Homework Task verification has been done by @Stream4u, hope you have enjoyed and learned something new.
Thank You.
@stream4u
Crypto Professors : Steemit Crypto Academy
Dear professor @stream4u, thanks for the review. I look forward to learning more from you and putting your suggestion into use.
Thank you once again