What ATH means and why is it important?
The knowledge of the fundamental analysis of any financial market is a prerequisite for the success of any trader.
There are different types of markets and as such the dynamics are also different in nature. Having this knowledge gives the trader a good understanding of how the market operates so that trading in such markets becomes advantageous for the trader.
However, most new players in the market prefer shortcuts or less difficult routes to achieve financial success from the trading platforms. This most times ends in major losses on the part of the new trader. We would be looking at one of these fundamental terminologies which could be helpful to anyone who intends to get involved in the trading markets.
What is All-Time High (ATH)?
The all-time high is the highest historical price level reached by crypto, security, commodity, or index during trading. The record high is measured from when the instrument first starts trading and updates whenever the last record high is exceeded. The values for record highs are usually nominal, which means they do not account for inflation. Investors employing a more contrarian strategy may look at record highs as an indicator that a stock's price will decrease, presenting an opportunity for shorts. This is also applicable to all cryptocurrencies as some of them could be attributed to securities and utilities during trading showing various high points on the charts.
All-time high records typically represent significant price news for companies and markets. Investors and traders may be enticed to purchase stock and cryptos, believing this company will continue to perform well in the future. Crypto projects and companies that constantly reach record highs quickly catch the eyes of prospective investors, while those who repeatedly hit record lows tend to scare off buyers.
There is a deep psychological bearing around ATH which tends to hold traders as a market or crypto moves higher, more traders get locked into the psychological trap of not buying back in after taking profits because a crypto price is higher than when they sold. However, whether a price is at a record high or low, a smart investor will also look at the business prospects of a company, analyzing the white paper document showing the progress of the project. If it is well run, and business prospects for the company appear to be in line with future growth, it may make sense to ignore the distraction that a record high or low maybe.
A perfect example was acknowledged in the bull run of late 2017, many cryptocurrencies set new All-Time High records, with Bitcoin setting a new ATH in mid-December. Each cryptocurrency exchange has a different ATH value for Bitcoin. In some markets, each coin was being traded above the mark of $20,000, but many consider that Bitcoin’s ATH was approximately $19,665. That has not stopped investors from believing that the highest point for Bitcoin has not been climaxed in any form in relation to what some expert analysts have predicted for Bitcoin. As at the time of writing this article Bitcoin was rallying around $65,800 which can not be compared to the previous ATH in 2017 and most people are of the opinion that this price would even explode to the upside and break new all-time highs due to prevailing economic challenges in the world and how the fiat currency is losing value on a daily basis.
At Klever, we have experienced some ATH that brought so much joy to the faces of users and traders alike. Looking forward to the next ATH.
It is indeed a Klever thing to do.
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