Cryptocurrency Forecast 2022
Published: January 10th, 2022 by Andrew
Given that more and more investors aspire to trade cryptocurrencies, it is not surprising that more and more are also looking online for Cryptocurrency Forecast for today, for 2021 and sometimes even for a wider time frame.
On the other hand, who would not want to have some useful “suggestions” available to be able to invest consistently in digital currencies?
Who would not love to take an indiscreet look at what will happen in the future and use these indications to guide their positions in the cryptocurrency field?
Well, in this our in-depth analysis on cryptocurrency forecast we will try to understand how to make predictions independently, how you can get free cryptocurrency forecast and how to trade cryptocurrencies without having any financial knowledge.
We will therefore talk about how you can therefore enter this market, from the front door, relying on the experience of professional traders.
If you want to know more, we recommend that you take a few minutes to read all of our in-depth analysis today.
Eventually you will discover:
- How to trade cryptocurrencies;
- What is technical analysis for cryptocurrencies;
- What is fundamental analysis for cryptocurrencies;
- How can you trade cryptocurrencies without knowledge.
A crucial aspect of our analysis will be the tools available on the best cryptocurrency trading platforms, which in our view represent the best choice to operate in this market (even more so than exchanges). A name above all? eToro.
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Reliable Cryptocurrency Forecast: where to find them
First of all, allow us a preview of some of the reflections that we will come to in the next few paragraphs.
What many novice traders have a hard time understanding is that making reliable cryptocurrency forecast is not easy at all, because there are complex processes and mechanisms that must take place to fully understand and analyze what is happening within the cryptocurrency market.
In short, it very often happens that between what is predicted by analysts and what actually occurs there is a more or less evident time delay. This delay is driven by the need to keep track of the psychology of cryptocurrency market cycles and how investors behave.
A monitoring that with regard to cryptocurrencies has elements of evident complexity, given that the market is “new” (Bitcoin was born 10 years ago, but cryptocurrency trading has only accelerated for 3-4 years) and which certainly cannot be compared to other asset classes.
In any case, know that there are 2 methods of price analysis that can be used to predict cryptocurrency trends, such as Technical Analysis and Fundamental Analysis.
Before understanding how they work, declined on digital currencies, let’s try to understand how to trade cryptocurrencies in a safe and professional way!
Cryptocurrency Trading: how to trade
Before even understanding how to get cryptocurrency forecasts, it can be useful to try to understand how to put them to good use!
The best way to trade cryptocurrencies is primarily to use a CFD broker. Do you already know what it is?
A CFD broker is an operator who specializes in opening and closing contracts for difference. We are talking about particular derivative financial instruments whose value depends on the value of an underlying asset such as, in fact, a cryptocurrency. But what does this all mean?
- The direction of the investment, predicting whether the value of the cryptocurrency will rise or fall in the near future. As a result, you will open a long / buy CFD, or a short / sell CFD respectively;
- Stop Loss and Take Profit, or the price levels in relation to which, automatically, the broker will close your position avoiding unexpected losses, and accounting for the desired profits;
- Any financial leverage, or a sort of “multiplier effect” that will allow you to aim for ever more important gains, in the face of an increasingly reduced capital investment;
- The capital to invest in the operation, naturally paying attention to your overall strategy, and the activation (if any) of the financial leverage.
Once you have established these factors, all you have to do is confirm the operation. And at that point?
Done the above:
- If the value of the cryptocurrency will take the expected direction (increasing or decreasing), then you can close the position in profit;
- If the value of the cryptocurrency will take the NOT expected direction, you will have to face negative results and, therefore, losses in the portfolio;
- In the event that the value of the cryptocurrency is able to touch the price levels of the stop loss or take profit, the broker will automatically close the position for you.
By investing with a CFD broker like eToro (here the official website) you can therefore try to monetize the best cryptocurrency forecasts in a simple and effective way.
Not only that: there is also another reason that should push you to use a CFD broker and … it’s called copytrading. We will talk about it later.
Cryptocurrency Forecast with Technical Analysis
With this parenthesis closed, let’s go back to the correct formulation of the 2021 cryptocurrency forecasts and beyond through the main methods of analysis.
As you may already know, there are two main approaches that analysts use in order to formulate the best forecasts on cryptocurrencies: technical analysis and fundamental analysis.
With technical analysis, the trader will carefully study the price charts of cryptocurrencies, their trading volumes and other essential parameters, in order to formulate their own projections of the price changes of digital currencies.
The positive aspects of cryptocurrency forecasts with technical analysis are truly numerous.
First of all, by also using the best CFD brokers in circulation, you will have plenty of free tools to do quality technical analysis.
Secondly, this method is easily accessible. Of course, becoming a trading expert with technical analysis is not exactly immediate, and will require a lot of effort but … you can still try to start exploring this interesting approach with very few hours of basic training, thus building a solid platform on which deepen, from time to time, the topics that will interest you the most.
We encourage you to take into consideration that most traders prefer this method for their investments, due to its simplicity and its easily understandable theories. And this is a big plus for traders, as it helps them narrow their entry points and steer them towards more knowledgeable (but certainly no less risk-free!) Strategies.
Read more: Technical Analysis
Cryptocurrency Forecast with Fundamental Analysis
The second way to make cryptocurrency forecasts, or to try to predict the evolution of prices of digital currencies is that of fundamental analysis.
Unlike the technical method, the fundamental one will require you a little more economic knowledge, because in order to be fully exploited it will require a variety of skills of a macroeconomic, political, financial nature, which you could accumulate only over a longer period of time.
In general, with cryptocurrency forecasts with fundamental analysis, a trader wants to understand what the “real” value of his cryptocurrency is, and understand whether or not it is lower than the current market value, in the belief that the market value will tend to converge towards the real one.
Either way, be careful not to jump to easy conclusions. The cryptocurrency market is extremely flexible. This means that it is not beneficial to focus on a single “determinant” to intercept changes over long periods of time.
So, we invite you to take into consideration that:
- It is usually easier to explain price fluctuations through detailed research, and to predict future prices, or assets, it is essential to know the impacts that cause price fluctuations in a more organic and integrated way;
- The above statement is true for other markets, but there are differences between the other markets and the cryptocurrency market, considering that the latter has only partially the same characteristics as shares and “fiat” currencies;
- It is also important to understand that the cryptocurrency industry is a decentralized market. Which means that there is no greater power of regulation, and unlike the technical method, physicality does not exist with the fundamental method.
Not only. Also keep in mind that nothing prevents you from using both technical analysis and fundamental analysis for your evaluations. Often it is from this mix of approaches that you can get the best cryptocurrency predictions for the short and medium term.
For example, a good part of traders have the habit of using fundamental analysis to guide their long-term forecasts. Within these, the aim is then to carry out a more restricted technical analysis in order to guide one’s own short-term forecasts.
Read more: Fundamental Analysis
Cryptocurrency Forecast with Copytrading
Another way to get excellent forecasts on cryptocurrencies, and which we have already partially talked about, is linked to eToro copytrading (here on the official website). Do you know what we are talking about?
Copytrading is a fantastic opportunity that some particularly skilled brokers – and eToro is the world leader in this! – allow you to use for free.
In very exemplified terms, through copytrading you can copy what the most famous and most established traders of the broker community are doing. And you will therefore be able to take advantage of the knowledge and experience of these investors in order to obtain forecasts on the trend of cryptocurrencies. All this, in a simple and automatic way!
All you have to do to take advantage of eToro’s copytrading is to open a trading account here for free with this broker and then make a first deposit, choosing your preferred payment system.
At this point, log in to the trading platform with your credentials and go to the People section.
Helping you with the masks and with the search filters, try to identify the traders to copy based on the requirements that you think are most important to you. For example, let’s think about past returns, the place of origin, the number of followers and other parameters that you think can support you in identifying “your” best trader.
At this point, proceed with confirming your intention to follow him and allocate capital for this purpose.
The broker will start copying all the operations carried out also on the “guru” trader’s portfolio into your portfolio. And at this point? Is simple:
- If the trader guru will start earning thanks to his competence and his ability, then his earnings will also be yours, given that, proportionally, they will end up also having repercussions in your wallet;
- If instead the trader guru is wrong in formulating the forecasts, it is evident that you will share with him the most negative fate, accounting for losses.
In fact, remember that even if the trader you are choosing to copy has a particularly prosperous past, with many investments made to profit, past returns are certainly not a guarantee of future returns!
Therefore, try to invest with copytrading with confidence but wisely, avoiding considering this possibility as a sort of goose that lays the golden eggs. Approach copy trading considering it as a very useful opportunity to improve your analytical skills and, at the same time, try to differentiate your investments by relying on the experiences of those who know more than you.
Cryptocurrency Forecast 2021
In closing, we make a brief overview of what is the expected trend for the cryptocurrency market for this 2021.
2020 probably represented the year of consecration for the sector. The speculative bubble that accompanied 2017/2018 left many investors with a bad taste in their mouths when it burst. Since that moment, a long side phase has taken hold in which Bitcoin and the main emerging cryptocurrencies have never managed to find the necessary momentum to return to really high levels, also thanks to a general distrust on the part of the general public.
In 2020, however, the situation has changed considerably. The past years have allowed cryptocurrency “parent” companies to further refine their technologies, just as trading platforms have implemented ever better security tools.
The outbreak of the coronavirus pandemic was the spark that was missing. People have progressively lost faith in real money, thanks to the economic crises that have put (and will continue to put) in difficulty most countries around the world.
In such an uncertain situation, assets such as cryptocurrencies have found the ideal ground to thrive. The proof is given by the fact that Bitcoin itself (together with its younger sisters, Ethereum in the lead) saw in the financial collapse of March 2020 one of the lowest points in their recent history, which however represented the springboard that led , in February 2021, the BTC to exceed $ 47,000 (value almost tenfold).
The growing attention from institutional investors and governments interested in regulating the cryptocurrency market is creating an increasingly stable and balanced sector. The growth margins are still wide, and cryptocurrencies could represent, for investors, the choice to make in this 2021.
So here we are at the conclusion of our in-depth study. We talked about cryptocurrency forecasts and everything you should take into consideration in order to invest in this very interesting and dynamic asset class with greater awareness.
Remember that, as reliable as cryptocurrency predictions may be, no one can ever give you 100% certainty of a profit. In other words, no one can predict the future. Even if you believe you have identified a particularly reliable forecast provider, you will still need to try to use those estimates with great caution, placing them within a broader strategy in line with your risk profile.
Of course, if you want to comment on the above considerations, all you have to do is use the space you find between the comments.
It will be the right opportunity to discuss a bit on this important issue and find new ideas to improve your ability to predict the price of cryptocurrencies. Good continuation!
Technical analysis and fundamental analysis.
Not actually, even a beginner with a little experience can do it.
Automatically copy the best investors thanks to eToro.
They usually follow the trend of Bitcoin. When it increases, they all go up. When it goes down, they all go down.