Bitcoin – Is It Possible to Predict the Gains in Cryptocurrency?

Bitcoin - Is It Possible to Predict the Gains in Cryptocurrency?

The bitcoin is crypto-activated most traded in the market and has reached US $ 570 billion capitalization. Digital currency reached a record price of US$ 63,000 in April 2021 and was considered the most profitable investment of all last year, with gains of 415% in the period. The currency has drawn the attention of traditional financial investors, such as banks, and famous ones, such as Elon Musk, owner of Tesla and SpaceX.

Bitcoin - Is It Possible to Predict the Gains in Cryptocurrency?

However, at the same speed that it generates gains, cryptocurrency can exhibit a bearish behavior, placing it within the group of high-risk investments. In May, less than a month after the historic high, the bitcoin backed off sharply and it even traded for $30,000 at times — which can scare off the most anxious and conservative investors.

Despite the apparently erratic asset value behavior, there are parameters that make it easier to understand price movements and even make it possible to visualize, with some predictability, trends in the appreciation or depreciation of the cryptocurrency. And, based on that, build a bitcoin investment strategy.

How to predict bitcoin earnings?

Despite the uncertain behavior of the digital currency, these and other features help to identify the movement trend, for investors to try to obtain gains from bitcoin operations. The most predictable swing is due to halving—cutting cryptocurrency output in half. So far, there have been three such events, all accompanied by a considerable rise in the price level.

In 2012, in the first halving, the currency jumped from US$10 to US$1,000, while in 2016, the asset went from US$1,000 to US$10,000. In the last halving, which took place in 2020, bitcoin went from less than US$ 10 thousand to around US$ 60 thousand. The next event of this nature is expected to take place only in 2024.

Another predictable moment of asset appreciation is near the expiration of bitcoin futures contracts. They are scheduled to always take place on the last Friday of each month, at 9 pm. It is all about reading the latest Cryptocurrency news. To get all latest stuff, check out The Next Bitcoin.

How does bitcoin work?

Bitcoin is the first digital currency created in the world, whose main feature is decentralization. Unlike traditional currencies, the cryptocurrency has no backing, that is, a guarantee on a product, such as gold, or another financial asset, such as the dollar. For this reason, its issuance is limited to 21 million units since its creation. The asset is traded on the internet, registered on its own network known as a blockchain.