Topic: Is technical analysis negatively affecting cryptocurrencies? - page 3. (Read 1309 times)

Regarding your first point: I don't think I have contradicted myself, I may just not have sufficiently explained what I mean: There is no scientific proof, that the underlying principles of TA work for any other reason than the widespread belief that it works, meaning that it is a self-fulfilling prophecy and similar patterns would not form if they were not believed in by a large group of people, making them completely independent of the underlying economics.

I absolutely think so. However, those fundamentals are time discrete. I cannot decide to do an analysis of the fundamentals right now, I can just analyze news coming out. That's opposed to traditional markets, where I can analyze fundamentals at any given time. i'm not saying this is bad, but it definitely powers volatility and TA.

Regarding your last point I just wanted to throw in, that this exact same argument was the favorite argument of High Frequency Traders in traditional markets:
"We are not damaging the market, we are just supplying liquidity".
Turns out that was not the entire truth.

Yes, it is affecting because; People believe technical analysis and they listen to analysis and when we can check youtube we will see there are more analysis for cryptocurrencies and people watch them if the analysis was negatively it is not good because investors will not invest to cryptocurrencies and it is bad for all market.

I have to say upfront that I'm no fan of technical analysis, even in traditional asset markets. There are 2 main reasons for this:
1) There is no scientific proof that technical analysis works at all. The only correlation between technical analysis and true market movements is that it is widely believed. And this leads to the next point
2) TA is a self-fulfilling prophecy. If people stopped believing in it, it would stop working right away. If people find new patterns they only start actually working once they get enough traction for other people to believe in them.

This is somewhat of a problem in traditional assets, but it is just a minor nuisance. The fundamental values of traditional assets always strike back, no matter what TA says. Found resistance? Doesn't matter if the underlying value shoots way up due to increasing sales, usage or whatever. Glad a value has some support? Doesn't matter if sales drop to near-zero, the price does not care about support.

At cryptocurrencies, however, those fundamental values don't work as there are rarely any. Most companies behind cryptocurrencies either have no product that is close to justifying their volume and value. Some of them (Bitcoin amongst them) do not even want to have one. Therefore they are subject to constant influence by those religiously believing in TA, which makes them an object of pure speculation. The fundamental values are "news", no matter the level of reliance.

In my opinion, this holds cryptocurrencies from being a usable and reliable method for everyday transaction use.

What is your view on this?

Technical analysis does not negatively affecting cryptocurrency , technical analysis can greatly help and improve the promotions of the cryptocurrency so that it will be successful for its launching and promotions.

A lot of people over the years have ended up condemning TA one way or the other, for some reasons best known to them, but like you said it, Technical analyses are just patterns in the market in which traders look for and no matter what, as long as we get to have institutions in play in most markets, all these patterns will always have a role to play in terms of resistance and support, call it whatever you want to call it.

This however is not what has brought about speculation as that is just something basically on its own, and the only thing that can help out of that is to at least get to see some real life usage which would bring about sustainable demand and less of speculation, but trust mate, speculation is something that will always be part of a market, take it or leave it!