What are the limitations of using fundamental analysis in crypto trading?

1 answers

• Dec 15, 2021 · 3 years ago
  As a representative of BYDFi, I can say that while fundamental analysis is an important tool in crypto trading, it does have its limitations. One limitation is the lack of standardized financial reporting in the crypto market. Unlike traditional companies, cryptocurrencies often do not have audited financial statements or clear revenue streams, making it difficult to assess their intrinsic value based on traditional fundamental analysis methods. Additionally, the crypto market is highly influenced by market sentiment and speculative behavior, which can lead to price movements that are not always rational or based on fundamental factors. Therefore, it's important for traders to consider a combination of fundamental analysis, technical analysis, and market sentiment analysis to make well-informed trading decisions in the crypto market.
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