I really like this approach, using the news as another indicator to gather data and for patterns to predict possible swings in the price does sounds like something I can get behind. Unfortunately, I don't know much about computing systems so I find it hard to understand how this is suppose to work properly, but if you can make it work then I feel like it might be something that can possibly provide good results.
Hey, thank You for the feedback. I think you will say I am right when I tell you that you can make rough estimates of future prices based on price history. Somehow there are patterns in the prices which are somehow conected to future prices. You can imagine a neural network (NN) as a black-box where you input the price history and it is learning about the patterns to predict future prices. A very good and very basic introduction is given in this youtube-video.
But the price is not only driven through the history, the main influence comes from the news. If .g. the European Union would say "Trading Bitcoin will be forbidden", this would result in a large crash. This is an extrem example, but this is basically what I tried in my blog: Quantifying news. This headline would give a negative sentiment and therefore the neural network would predict a huge drop in Bitcoin price.
I hope it's a bit more clear now how this basically works. I linked a few pages in the blog so that you can get further information.
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Also, you might receive better feedback if you post this in the Speculation board, or perhaps in the Bitcoin Discussion board.
Thanks for this hint. Unfortunately I just know a bit about the prediction-part. But to blogging and posting I am completely new
