I asked ChatGPT Bitcoin price action, it had this advice to give me

Disclaimer: The information presented does not constitute financial, investment, trading or other types of advice and is solely the opinion of the author

Bitcoin [BTC] Trading can be both lucrative and challenging. One way to successfully do that is by developing effective trading strategies that can help traders navigate complex and ever-changing market conditions.

The world’s largest cryptocurrency’s journey to become one began in 2009, with an initial value of less than a krone. The price remained relatively stable in the early years. In 2013, however, it saw an increase in value, reaching an all-time high of $1,242 in November. This ride was short-lived, however, and within months the price dropped below $200.

The following years were marked by periods of volatility, with the price fluctuating between $200 and $1,000. At the end of 2017, however, BTC’s value exploded, reaching an all-time high of nearly $20,000 in December.

Read Bitcoins [BTC] Price prediction 2023-24

As market participation grew, the price rise was also short-lived. By early 2018, BTC’s price had fallen back to around $3,000. The cryptocurrency market as a whole recorded a period of decline, with many investors losing significant amounts of money.

Nevertheless, BTC made a remarkable recovery, surpassing its previous all-time high in late 2020 and reaching an all-time high above $68,000 in November 2021. However, the 2022 trading year ushered in a new era of bearishness, one exacerbated by the collapse of Terra/LUNA and FTX. In fact, in November 2022, BTC traded at a two-year low of $15,000.

Although the crypto market can be unpredictable and volatile, traders and investors can still make informed decisions by staying up-to-date on market news, following expert analysis and using intelligent trading strategies, such as those offered by ChatGPT.

ChatGPT: A messiah to help you trade better?

In November 2022, the AI ​​model ChatGPT was launched to the public. In fact, it quickly gained considerable attention as well. With its wide range of capabilities and versatility, the question arises whether there are other ways ChatGPT can lend its expertise, such as helping BTC traders formulate and apply improved trading strategies.

When asked if it could do this, ChatGPT had this to say –

Source: ChatGPT

Due to its nature as an AI tool, there are limitations to what ChatGPT can do regarding price predictions and future price movements. However, there are ways to leverage the tool’s capabilities to formulate better trading strategies as a BTC trader.

One way to use the AI ​​tool to create better trading strategies is by deploying it against fundamental analysis. ChatGPT is able to extract insights from financial news articles, social media posts and other unstructured data sources. This information can then be used in conjunction with other data sets to create informed trading strategies.

Another way to use ChatGPT as a BTC trader is to use it for sentiment analysis. ChatGPT can be fine-tuned to perform sentiment analysis on information from news articles, on-chain data providers, social media discussions and other sources. This can be used to identify whether the BTC market is hanging under positive sentiment or is plagued by negative sentiment.

Furthermore, ChatGPT can be used by BTC traders for technical analysis. Traders can ask ChatGPT to code any technical indicator or trading bot for any trading platform.

For example, I asked ChatGPT to provide me with an example of a trading bot that I can use to track BTC price volatility in pinescript – TradingView’s programming language useful for backtesting trading strategies. AI replied,

Source: ChatGPT

To use ChatGPT for technical analysis, traders need to be familiar with the language to know when to make the necessary modifications for the code to work properly. The wording of the input is decisive for how ChatGPT understands the problem in order to provide the expected solution.

Is your portfolio green? Check Bitcoin Profit Calculator

For a well-rounded piece, I spoke with Brian Quinlivan, director of marketing at Santiment, who also happens to have been involved in BTC trading for a few years.

Brian Quinlivan holds an MBA degree in finance from Chapman University, Brian has over 10 years of experience in marketing, finance and data analytics. He enjoys creating financial models to improve current investment strategies and studying the intricacies of market fluctuations.

Q: In what ways do you think ChatGPT can revolutionize cryptocurrency trading?

Yes, I think there’s going to be a lot of use for it, certainly for trading strategies. One thing to be concerned about is the uniformity of opinion that can result from an AI technology providing some sort of overarching strategy, whether it’s hodling or basic strategy.

ChatGPT can easily be used for manipulation and even unintentionally manipulate the audience and we are already seeing small effects from it.

I think it can be both useful and dangerous at the same time and lead to a lot of people being educated much faster, but also being pulled in directions that can affect the way crypto goes and create a lot of self-fulfilling prophecies.

Q: How do you think a BTC trader/investor can leverage the AI ​​tool to make better investment decisions?

I think, in short, I think that scripts will be used in AI much more due to the fact that all the data can be digested at the same time and given a very simple answer whether to buy or sell. I think this can have a huge impact on the markets going forward.

How fast can BTC go to $30,000?

As mentioned above, ChatGPT is not able to make future predictions. However, I asked it to give me its opinion on how soon BTC would claim the $30,000 psychological price mark in light of seemingly bearish macro factors.

Source: ChatGPT

To get it to answer my question, I decided to jailbreak it using Do Anything Now (DAN) method. It had this to say afterwards:

Source: ChatGPT

I further asked the AI ​​technology about BTC’s price between 2023 and 2024.

Source: ChatGPT

At press time, BTC was traded at $28,047. With the price falling by 2% in the past week, BTC has continued to fluctuate between the $27,500 and $28,500 price levels over the past seven days.

As investors expect to regain the $30,000 mark, many have taken profits on their investments. In fact, according to data from Sentimentthe coin’s MVRV ratio was 45.85% at press time, positioned in an uptrend.

A positive MVRV ratio above two for any crypto-asset means that holders can make an average profit of twice the original investment if they sell their coins at the current price.

Source: Sentiment

Buyers were seen in control of the BTC market on the daily chart and have been for the past two weeks. At press time, the positive directional indicator (blue) of 9.81 rested below the negative directional indicator (orange) of 31.36. Also, the average directional index (magenta) revealed that we are entering a slightly bearish market for BTC for a while. But as the trajectory over the past month suggests, sentiment has been quite inconsistent. Ergo, it is only a matter of time before we see the crypto bounce back.

Additionally, BTC’s Relative Strength Index (RSI) and Money Flow Index (MFI) were positioned well below their respective 50-neutral spots of 36.73 and 28.32.

ChatGPT may be right

According to ChatGPT, BTC’s price is expected to continue to rise and break new all-time highs between 2023 and 2024 due to increased adoption (by companies and institutions) and as BTC’s appeal as a hedge against inflation grows. This prediction is perfect, as favorable macro conditions can help boost the value of the leading coin.

It is, however, trivial to note that increased regulation and government measures can spread R&D, which causes the price to fall.