BTC price moved by emotion and mood!

[CryptoRaymond]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible. But I think it is partially true. Because if you see the number of people engagement with bitcoin, you will see that a large number of people came to this market after the vibe of BTC rising. And they entered here without gathering proper knowledge.

What do you think about this? What would be its effect???

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[1020kingz]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible. But I think it is partially true. Because if you see the number of people engagement with bitcoin, you will see that a large number of people came to this market after the vibe of BTC rising. And they entered here without gathering proper knowledge.

What do you think about this? What would be its effect???

It is partially true, there are many newcomers investing in bitcoin and it’s demand is getting more and more everyday. However although there are some factors that affect it’s price but bitcoin has its own economic system in cryptocurrency world. It is more like the world economics that the US dollar has the main stream of the economy, and if this currency goes up or down almost all the currency in the world is affected. Same in crypto, bitcoin is the main stream of crypto currency whatever it’s price it can affect to the other alts prices.

[Crypto Id]

It's not completely true. But you can take it like when a news appears to the market, like China is going to ban crypto currency or any other. With the fear of these kind of news people think btc it is going to dump and many of them starts to sale there btc and unfortunately the btc price goes down.

[1Referee]

You don't have to be a professor to figure that out, it's just common sense because it applies to all emerging markets; they are speculative by nature, and thus an emotional roller coaster, and thus volatile.

I have said it before, large players play with people mentally to steer them into a certain direction, and that has been the case since the very beginning. This market is so small (still so today) that deep pockets can have the best time of their life in this market. If you add that there are now alternative ways (futures, options, etc) that will allow you to not only benefit once from manipulating the market, but two or three times simultaneously, manipulation suddenly becomes a whole lot more luctrative.

Holders don't have to deal with this volatility. If the market tanks, they can just buy up some coins and sit on them for years. Easy life.

[The Sceptical Chymist]

You don't have to be a professor to figure that out, it's just common sense because it applies to all emerging markets; they are speculative by nature, and thus an emotional roller coaster, and thus volatile.

True, but "emerging markets" usually refers to businesses within those markets, and thus when you use that phrase, it probably refers to stock markets.  As I've said quite a few times before, stocks are very, very different than crypto.  They do have some similarities, but the bottom line is that you can analyze stocks much easier than you can a cryptocurrency.  With stocks, there's a business that's behind a given stock that has earnings, management, perhaps a dividend, and businesses are affected by general economic conditions as well. 

What does bitcoin have?  News and investor sentiment.  That's it.  Bitcoin doesn't have earnings and doesn't pay a dividend--what its price boils down to is simply supply and demand, and the supply is always known.  So it's basically demand only, and that demand comes from rumors, news, and investor emotion.  If anyone can think of any other factors, I'd love to hear them, because those are the only ones I can see.

[Denker]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible. But I think it is partially true. Because if you see the number of people engagement with bitcoin, you will see that a large number of people came to this market after the vibe of BTC rising. And they entered here without gathering proper knowledge.

What do you think about this? What would be its effect???

In general, all markets move due to emotions. What differs is the strength of these emotions.
And yes I would agree that the crypto space is very much driven by feelings, hype and doom.
Many market participants are completely new and never have traded or invested in any asset before.
So the market is packed with noobs, people who can easily be played with by the real experienced guys.
Just have a look at those twitter accounts following these 'Crypto OGs' or all those telegram chat groups. Noobs everywhere, who believe they can get rich over night and barely understand the basics of trading or investing at all. And just one simple fabricated news is enough to make people dump or fomo in. 

[richardsNY]

And just one simple fabricated news is enough to make people dump or fomo in.  

That's why this market is so interesting for traders and investors, but at the same time also points out how weak it actually is. If there is one thing that does somewhat bother me, then it definitely is the fact that this market throughout the years failed to attract liquidity, and then mainly the exchanges since they make or break the price in the end. In terms of percentages, the current liquidity on exchanges isn't any different from what it was years ago, and that's pretty disappointing. If there was more liquidity available, the massive price swings of today wouldn't exist. We'll see how the market is going to change with institutions tuning in....

[bitcad4u]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible. But I think it is partially true. Because if you see the number of people engagement with bitcoin, you will see that a large number of people came to this market after the vibe of BTC rising. And they entered here without gathering proper knowledge.

What do you think about this? What would be its effect???

You words are partially true.In bitcoin trading,emotion will plays a major role.W hen the price decrease,you will buy a bitcoin with the hope.It will reach some high value in a future.When the price increase,you will hold for the further raise.Maybe the price will increase or decrease based on investors.So don't allow your emotion in this two conditions.

[dothebeats]

In part, yes, especially if there is a selloff happening. Most newbies and weak hands tend to give in to their anxiety and emotion especially if they see that the price is tumbling down rapidly and they can't do anything but sell and cut losses or endure the pain. During rises, the hype and short-lived euphoria (or FOMO) dictates how far the push will go. With the last bull run, we see the prices reaching up to $19k a piece, and that's purely fomo starting $10k. It's no surprise that emotions really take cryptos to new heights and lows even without real economic reason.

[JacobLiam12]

You are right. Professor Daniele is partially right. Most of the investors these days are investing in cryptos just because of the hype that is created in market. They lack proper knowledge and information about the Cryptocurrencies.

[samcrypto]

It can be most especially to the beginners because they usually reacts on the news they heard. Its actually risky to depend on your emotion, the btc price should be backed up by its own technology so we can survive in the future.

[Tankdestroyer]

What do you think about this? What would be its effect???

Do not worry much about it because those who enter bitcoin market by emotion and mood are only noobs here to get rich quick but in reality, they can't without a proper strategy of investing into it. It wouldn't have its long-term effect because bitcoin has real world use cases that institutions are looking into right now but hopefully, they will stop doing it soon because entering the market by emotion is not healthy for the crypto market in general.

[exstasie]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible. But I think it is partially true.

I think what Bianchi is observing is the effects of low liquidity in the crypto market. Low liquidity means high volatility, which triggers emotional trading.

I think what he's saying applies to the stock market as well (to a lesser extent because of better liquidity). Any period of high volatility is driven by emotion, particularly crashes. And the market has become so exuberant that most indices are completely removed from productive value or realistic returns.

IMO, consumptive commodities are closer than other markets to real value based on macroeconomic supply/demand cycles. But I really think all markets are highly emotional.

[crzy]

You are right. Professor Daniele is partially right. Most of the investors these days are investing in cryptos just because of the hype that is created in market. They lack proper knowledge and information about the Cryptocurrencies.

Indeed, people easily enter the market without having any study about it and sometimes they ended up a victim of a scam. The emotion of every newbie in cryptomarket can really moved the price of bitcoin, we see this thing every time we heard negative news about bitcoin, and the price of bitcoin dump. Emotion is a big thing when you do investing or even trading, so people should know how to control it.

[bobo012]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible. But I think it is partially true. Because if you see the number of people engagement with bitcoin, you will see that a large number of people came to this market after the vibe of BTC rising. And they entered here without gathering proper knowledge.

What do you think about this? What would be its effect???

It is entirely true that it is influenced by mood, and news outlets. I personally think it is worth much more than today prices, it will go to zero or be very high, there is no middle ground for bitcoin.

[Pursuer]

saying this without explaining what market looks like first is a bit misleading.
the market that this is talking about is the cryptocurrency market in general and mostly focusing on altcoins. generally speaking this market is very small and susceptible to news. and when it comes to altcoins the market is filled with a lot of inexperience people who call themselves "investors" but in fact they are just kids throwing away money and gambling with it instead of investing.
in this market it would have been surprising if things weren't moved by emotions.

[c++btc]

I can't really say now that it is just emotion and mood because those people who are buying in markets without proper knowledge in bitcoin are the people who just got influenced by the people who are rich and the people that are successful in their life in bitcoin.

[TheQuin]

saying this without explaining what market looks like first is a bit misleading.
the market that this is talking about is the cryptocurrency market in general and mostly focusing on altcoins. generally speaking this market is very small and susceptible to news. and when it comes to altcoins the market is filled with a lot of inexperience people who call themselves "investors" but in fact they are just kids throwing away money and gambling with it instead of investing.
in this market it would have been surprising if things weren't moved by emotions.

All markets are moved by mood and emotions because people are speculating on the future value rather than the assumed value right now. News events can switch that mood equally quickly with stocks, commodities or fiat currencies. The things you describe about the difference between experienced professional investors and inexperienced kids just amplifies that effect. That's a large part of what makes crypto so volatile.

[batang_bitcoin]

A study by finance professor Daniele Bianchi says that the prices of cryptocurrencies are influenced by the mood, hype and emotions of investors mostly rather than economic factors. It really sounds horrible.

Horrible as it is but there's truth to what he said. I experienced it when I'm in bad mood by witnessing the flow of the price in a negative way and that gave me a bad mood/emotion that cause me to start panicking.

A crowd of small holders will have the same feeling, there's power in number so altogether the force gathered are making movement to the price.

[Aikidoka]

It is just that some people are stupid and cowards. They believe everything they hear. If the media spreads rumors about Bitcoin falling down and it is going to get to an end, they will believe it and sell their Bitcoins. The problem is not with bitcoin or how it is moved by emotion and mood. Bitcoin is not a human being. But people should finish what they started and not give up on it. If they believed in it, they would not have had forsaken it, and that's final!