beincrypto.com
As artificial intelligence (AI) rises in popularity, the big question among the community is if it can be helpful in generating price predictions.
Chatbots such as ChatGPT and Bard are taking the market by storm, so the trading community speculates on whether AI can predict future prices.
Aggregate Intelligence
David Booth, the founder, and chairman of Dimensional Fund Advisor, shared his input on using AI to track stocks. In a Financial Times article, Booth shared that the market is the best AI. He wrote:
“I think my AI is better than all the other ones out there. My AI is the market.”
He calls the market “Aggregate Intelligence,” which also includes artificial intelligence and betters it.
This is because the price of a particular trading instrument, such as stock or crypto, is based on demand and supply. The current price represents various information, data, sentiments, and even the bets placed by various trading algorithms.
Booth claims:
“Large language models, the types of AI that power tools such as ChatGPT, are intended to understand and generate text that seems as if it was made by humans, not predict future outcomes.”
Last month, BeInCrypto reported the limitations of ChatGPT in making Bitcoin (BTC) price predictions.
Results of AI Trading Not Satisfactory: Software Developer
Neel Kukreti, a renowned trader and software developer, believes AI can help research faster. But, at the current stage, he is not satisfied with the backtesting results using AI indicators.
He told BeInCrypto:
“I don’t trust AI at this stage to make trading decisions. I have tried to develop indicators using AI, but on backtesting, results were not satisfactory.”
BeInCrypto recently asked Bard to make Shiba Inu (SHIB) price prediction for the end of 2023. Although it predicted SHIB to hit $0.000011 by the end of 2023, the data was drawn from the price prediction aggregator CoinCodex.
However, Bard also shared its reasoning on why it is highly unlikely for SHIB to hit $1. It listed factors such as increasing demand and a burn in SHIB supply that could lead to the meme coin achieving the $1 milestone.