The idea behind cryptocurrency is to make a profit. So whether or not you own some now or you are the midst of mining for some, you would eventually want to know how much it is worth later.
Bitcoin price prediction jumpstart
The most important issue with having bitcoin is to determine its price so that you can either:
- Hang on to them
- or sell them
Basics of bitcoin price
This might be a walk in a park for the seasoned investors but if you are a beginner heading out to invest into cryptocurrencies, then it might be quite a challenge. So, it is ultimately imperative that you know the following issues.
The current price of your bitcoin
This applies to the situation where you already have the Bitcoin. Running on the symbol of BTC, the best place to start is to go to the exchange where you bought the cryptocurrency. Whether it is Bitfinex, BTC or any exchange for that matter, referring to them would tell you what your current price is. That would be a start.
Methods involved in predicting cryptocurrency price
Make no mistake about it, there is no right or wrong method in this. After all, it is all about probabilities. It won’t be called a money market if there was no risk. There are in general, 2 approaches in predicting prices in such markets and this is quite common in the likes of the stock market which are:
- Fundamental Analysis
- Technical Analysis
This is the type of analysis where the underlying forces of a particular economy is being examined. It includes the firm or the security involved in that economy. Meanwhile, technical analysis involved a more systematic approach. It is where the direction of the price of a certain company would go being forecasted. To do this, the historical data and movement of that counter will be used and applied. In other words, technical analysis is to predict the future based on the past.
What about bitcoin charts?
For bitcoins, technical analysis would be an appropriate approach. To do this, you will need to find price charts of the bitcoin and to find those that are easy to understand. Plan number tables would not work for you. One of the places you can start is through the Bitcoin Price Index. This type of chart is among the most basic form you can find. It will display the price in line form. If you look at the chart it will plot the closing prices of any given period. This could be an hour, a month or a day. From the chart, you will then see how the bitcoin has been performing recently.
The Candlestick Chart
Traders meanwhile would prefer to use the Candlestick Chart. This type of chart does not only show the closing price. in fact, it is called ‘candle’ because each stick has the opening price and both the lowest and highest prices of the given period. Together with the closing price and the color of the candle, you can easily see where the closing price is higher than the opening. This chart is part of the Open High, Low Close (OHLC) chart family where there are many other types to choose from
Non-time Based Range Chart
Known in short as NTB, this type of chart is slightly more advanced, especially for the beginner. Such charts are useful to use where it can show the reader where the highs and lows are. As such, together with the patterns illustrated, you can now determine the trend be either:
- Ranging sideways
So, what’s next?
Having the knowledge is one thing, knowing what to do with it is another. Now that you know how to read the charts, you will have to take the next step which is to monitor the price of the bitcoin on a daily basis. What you want to take note here is to take note of the price change behavior and then move on from there before forming your own conclusion and judgment.