Bitcoin: BTC volatility drops to a year low, get ready for a spiral drive
- BTC/USD has spent another week in a tight channel.
- Violent moves may be ahead once the channel is broken.
BTC/USD Forecast Poll
The extreme volatility of the cryptocurrencies and more specifically, Bitcoin, requires the trader to stay informed at all times about the latest technical analysis and BTC/USD forecast.
Learn more about the Forecast Poll charts / Download the PDF version
How to Read the Forecast Poll charts
Overview
This chart informs about the average forecast prices, and also how close (or far apart) sit the numbers from all participants surveyed that week. The bigger a bubble on the chart means more participants targeting a certain price level in that particular time horizon. This distribution also tells if there is unanimity (or disparity) among participants.
Bias
Each participant's bias is calculated automatically based on the week's close price and recent volatility. Drawing from those results, this chart calculates the distribution of bullish, bearish, and sideways forecast prices from all participants, informing about sentiment extremes, as well levels of indecision reflected in the number of “sideways”.
Averages
By displaying three central tendency measures (mean, median, and mode), you can know if the average forecast is being skewed by
shifted price
In this chart, the close price is shifted behind so it corresponds to the date when the price for that week was forecasted. This enables the comparison between the average forecast price and the effective close price.
price change
This chart tracks the percentage change between the close prices. Bouts of volatility (or extreme flat volatility) can be then compared to the typical outcome expressed through the averages.
smooth average
This measure is basically an arithmetical average of the three central tendency measures (mean, median, and mode). It smooths the typical outcome eliminating any possible noise caused by outliers.
min/max
Together with the close price, this chart displays the minimum and maximum forecast prices collected among individual participants. The result is a price corridor, usually enveloping the weekly close price from above and below, and serves as a measure of volatility.
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WHAT IS THE FORECAST POLL AND WHY TO USE IT?
The Forecast Poll is a sentiment tool that highlights near and medium-term price expectations from leading market experts. It is a sentiment indicator which delivers actionable price levels, not merely “mood” or “positioning” indications. Traders can check if there is unanimity among the surveyed experts – if there is excessive speculator sentiment driving a market – or if there are divergences among them. When sentiment is not at extremes, traders get actionable price targets to trade upon. When there is a deviation between the actual market rate and value reflected in forecasted rate, there is usually an opportunity to enter the market.
You can also use the Outlook Poll for contrarian thinking strategies. Gonçalo Moreira, Research expert at FXStreet, explains: “People involuntarily follow the impulses of the crowd. Sentiment indicators, in turn, lead to 'contrarian' thinking. The Di helps traders detect sentiment extremes and thereby limit their eventual toxic herd behavior.” Read more on Contrarian Approaches with Sentiment indicators
HOW TO READ THE GRAPHS?
Besides the table with all participants’ individual predict, a graphic representation aggregates and visualizes the data: the Bullish/Bearish/Sideways line shows the percentage of our contributors on each of these outlook biases.
This graph is available for each time horizon (1 week, 1 month, 1 quarter). We also indicate the average price predict as well as the average bias.
BITCOIN FORECAST
In our BTC/USD Forecast Poll 2020, our dedicated contributors expect a bullish reversal into the trend during the year that can push BTC/USD to the maximum historical levels. By the end of the year 2019, the average outlook for the pair was 12.768,74.
From Jan 2019 to Jan 2020, the highest lever for BTC/USD was 12,483.03 on Jun 26.
MOST INFLUENTIAL EVENTS IN 2020 FOR BITCOIN
On June 13, 2019, the Wall Street Journal published information that Facebook was working on a major Blockchain project. The project included the launch of the digital currency, called Libra, and a wallet called Calibra. The planning of the project sets the first half of 2020 as the date for the launch of the Libra cryptocurrency.
As a result of the Libra case, many governments and central banks realized that the implementation of cryptocurrencies projects was not going to wait for anyone, and decided to get down to work and launch their own projects. China, India, France, Tunisia, Lithuania and the European Union, among others, have presented their own digital coin projects, to be launched as early as 2020.
The crypto market has seen the number of projects listed in exchanges increase exponentially to reach a ceiling of around 4100 projects. Among all these, it is estimated that 1085 of them are no longer around and, according to experts consulted, many of the 3000 remaining will fall in the short term.
