Cryptocurrencies have gained increasing interest and adoption from traders, but it is important to remember that they do pose inherent risks.
Brad Garlinghouse has great faith in Ripple’s future, predicting it will reach US$30 per coin by 2023. According to him, increased adoption and positive legal outcomes are essential elements for making such a prediction come true.
Analysis of Price Trends
Coins like Bitcoin and Ethereum remain popular investments among investors. Yet other cryptocurrencies, including Ripple’s XRP token, have seen increasing interest due to its unique benefits which make it an attractive investment opportunity.
Bitcoin Cash is one of the many forks of the Bitcoin blockchain and offers fast processing times and lower transaction fees, making it an excellent alternative to BTC and other cryptocurrencies.
ADA has been on an uptrend this week and looks poised to break through its resistance level at 38 cents, potentially propelling further gains towards $1 by year’s end.
Analysis of Trading Volume
Even amid recent volatility in cryptocurrency markets, analysts remain hopeful for its rebound. Investment firm Fundstrat Global Advisors recently increased its Bitcoin price target to $2,270 while others predict lower levels.
Ripple is a company that creates software to assist financial institutions in the facilitation of cross-border transactions. Their system was designed to address an issue common among many companies such as Google which makes millions of payments each day to app makers and independent research and development units – transactions with low value that create time delays between transactions at banks and cost them money in fees.
This study employs an empirical approach to analyze the relationships among 16 cryptocurrencies by employing Minimum Spanning Tree and hierarchical analysis by dendrogram, combined with correlations of daily returns. We find that trading volume Granger causes returns during bearish market phases while not significantly contributing to volatility (except Litecoin and Nem at extreme lower quantiles).
Analysis of Volatility
Volatility is a critical aspect of cryptocurrency markets. While prices can sometimes experience sharp price movements, other times they remain relatively steady or even decrease slightly over time. To stay ahead of fluctuations, traders need to be aware of them and adjust their trading strategies accordingly.
Bouri et al. (2020a) used three models to analyze the volatility of cryptocurrencies. They employed ARMA, TGARCH, and ACGARCH as tools for modeling returns of 12 cryptocurrencies; their results indicated that positive shocks have more effect on BTC, ETH, XRP, ADA and LTC than DSH IOT XMR LINK return series.
Rolling window wavelet correlation coefficients for BTC-ETH pair demonstrate a similar trend throughout 2017, with lower correlations at relatively higher wavelet scales for much of 2017 due to a likely bubble in the crypto marketplace which led to higher prices and subsequent price decline. This trend can also be observed within kurtosis statistics.
Analysis of Trading Strategies
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The majority of surveyed papers utilize machine learning models to forecast returns and prices of cryptocurrency assets such as Bitcoin (BTC), Ethereum and Litecoin (XRP). Furthermore, these ML techniques are employed not only for producing predictions on dependent variables but also as trading strategies devised based on these predictive models.
These machine learning-based trading strategies are evaluated based on their profitability over their validation period without considering trading costs; some studies also compare them with passive buy-and-hold strategies.
Experts predict that by 2023, the price of XRP may range between $0.516 and $0.626 with an expected trading cost averaging out to be approximately $0.509. They forecast an upward trend for this cryptocurrency.
