Methods of forecasting the prices of cryptocurrency on the financial markets

Yurii Pronchakov and Oleg Bugaienko
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Yurii Pronchakov: National Aerospace University "Kharkiv Aviation Institute" 17 Chkalova str., Kharkiv, Ukraine, 61070
Oleg Bugaienko: National Aerospace University "Kharkiv Aviation Institute" 17 Chkalova str., Kharkiv, Ukraine, 61070

TECHNOLOGY TRANSFER: INNOVATIVE SOLUTIONS IN SOCIAL SCIENCES AND HUMANITIES

Abstract:

The article describes the problem of forecasting prices of cryptocurrencies at the financial markets. Methods for analyzing and forecasting prices of cryptocurrencies at the financial markets are considered in detail. A trend indicator – moving averages – is considered as an auxiliary tool for technical analysis that helps to analyze and forecast prices of cryptocurrencies at the financial markets. During the study there were analyzed several methods of different categories, namely: SMA (Simple Moving Average), EMA (Exponential Moving Average), WMA (Weighted Moving Average). For analyzing moving averages, there were conducted the analysis, based on mean-square deviation together with the standard graphic analysis. The whole process was divided in several stages: a moving average was calculated, based on basic values; based on values of the calculated moving average, there was calculated a mean square deviation; deviation with the least numerical value was chosen among the massive of deviations. It has been revealed, that SMA has the least value of mean-square deviation, but EMA is the better choice, because EMA is most sensitive among considered moving averages, although an error extent is rater more.

Keywords: cryptocurrency; forecast; electronic currency; simple moving average; exponential moving average; weighted moving average; trend indicator. (search for similar items in EconPapers)
Date: 2019-06-25
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