The Mass Media Effect or How News Impact Crypto Market Prices
The Crypto Market Pressure – Can News Manipulate The Prices?
Is it realistic to predict the rate of digital money, starting from important news in the industry, and if so, what you should pay attention to – we decided to research this issue in our today’s blog post.
Often, large movements both in the market and in the case of individual coins occur in connection with some loud informational occasions. For example, on December 12 last year, the Chinese social network Weibo blocked the account of Justin Sun, the founder of TRON, after which the token price fell by 6%, from $ 0.01410 to $ 0.01330. Probably, traders began to sell altcoin on the background of negative news, which led to a decrease in its rate.
However, a few hours after this, the price of the token recovered and rose above the previous values to $ 0.01420. This can be explained by the fact that after the decline in value. Altcoins began to be bought by both sides. For instance, by those who were attracted by its low rate and those who sold the coin due to news about the restriction. As a result, total purchases turned out to be more than sales, which is why TRON rose in price.
Popular Exchanges May Pump The Prices
Yes, don’t be surprised. If you think that popular crypto exchanges are angels and want you to get profits instantly, then you must be new in this business. In recent years, many exchanges were involved in dubious actions. Mostly, when the community discussed this or that project and its token.
For example, on December 17, Binance announced a competition for traders that involved the WINK token. Immediately after the announcement of the exchange, the altcoin rate grew by 16%. However, a day later, it returned to its previous level.
On the same day, another token price took off. Kava went up 18%, from $ 0.92 to $ 1.1, a few hours after Binance announced that it would support stacking on the altcoin network. But, as in the case of WINK, its value fell to its previous values by the end of the same day.
Based on this, it seems that you can have time to buy a token before its value grows if you follow Binance messages and respond to them promptly. But practice shows that this is not so. As a rule, just a second after the announcement of the exchange about holding a contest with altcoin, its rate rises sharply.
It is not superfluous to mention the Matic token, the price of which for the month increased by almost 300%, and then fell to its previous values in a few days. The reason for the rise in the price of the coin could be a series of positive news. The startup reported on participation in various conferences announced the addition of its product to a new exchange and announced the introduction of stacking.