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ChatGPT’s Bitcoin projections are unexpected, but do the ChatGPT’s claims hold water?
ChatGPT, a text-based artificial intelligence (AI) tool developed by OpenAI, has recently been popular due to its capacity to create replies to user inquiries that are extremely similar to those of a real human, covering a wide range of topics. Indeed, global Google searches for the keyword ‘ChatGPT’ increased in January, with China ranking as the region with the highest search interest in the platform, while the United States isn’t among the countries experiencing increased demand. As it happens, one duty where ChatGPT might be quite valuable is accumulating and providing to users estimates of potential price movement ranges of digital assets on the cryptocurrency market, such as Bitcoin (BTC).
Surprisingly, ChatGPT acknowledged that “it is impossible to predict the exact price of Bitcoin by the end of 2023, as the cryptocurrency market is highly volatile and unpredictable.” However, it did present bullish Bitcoin expectations, citing historical data, charts, and gauges. Interestingly, the AI-powered platform’s expectations are in line with those of Bitcoin aficionados, who believe that the flagship decentralized finance (DeFi) commodity is well on its way to greater use and a higher price in 2023. ChatGPT would not provide exact numbers for longer-term estimates, i.e. by 2030, citing significant market volatility and government laws, but did recognize that “Bitcoin will likely become more widely accepted, and its value will continue to rise.”
Bitcoin’s price at press time was $21,256, a 0.30% increase on the day, a 21.91% increase over the preceding seven days, and a total gain of 26.92% on its monthly chart, according to data gathered on January 18. As previously reported, the flagship digital asset is on the verge of breaking a historical milestone, extending its winning streak to 14 days and exhibiting one of the longest periods of consistently positive price movement in its history.
For a long period, the cryptocurrency’s price charted between $200 and $1,000. However, in late 2017, the value of BTC skyrocketed, reaching an all-time high of nearly $20,000 in December. As market participation increased, so did the price rally. By early 2018, the price of BTC had dropped back to roughly $3,000. The Bitcoin industry as a whole has seen a period of downturn, with many investors losing large sums of money. Nonetheless, BTC recovered spectacularly, surpassing its previous all-time high in late 2020 and reaching an all-time high of more than $68,000 in November 2021. However, the 2022 trading year marked the beginning of a new period of bearishness, which was exacerbated by the demise of Terra/LUNA and FTX. In reality, BTC was trading at a two-year low of $15,000 in November 2022.
ChatGPT has limits in terms of price forecasts and price future movements due to its nature as an AI tool. However, as a BTC trader, there are ways to use the tool’s capabilities to develop better trading strategies. One method to use the AI technology to improve trading tactics is to apply it to fundamental analysis. ChatGPT can mine financial news articles, social media posts, and other unstructured data sources for insights. This data may then be used with other datasets to develop intelligent trading strategies. ChatGPT may also be used for sentiment analysis as a BTC trader. ChatGPT may be configured to execute sentiment analysis on data from news articles, on-chain data providers, social media conversations, and other sources. This may be used to determine if the BTC market is dominated by positive emotion or by negative sentiment. Furthermore, BTC traders can use ChatGPT for technical analysis. ChatGPT can create any technical indicator or trading bot for any trading platform.
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