KAVA Price Analysis: Sharpe Indicator Predicts Massive Potential Gains

KAVA price is going through a bullish trend. If you closely observe then you will find that almost all cryptocurrencies are in the green zone and showing good progress. In our previous analysis, we had mentioned that the Binance backed project KAVA has gained almost 140% in the last 30 days. At the time of writing this article, the KAVA price is sitting at $4.02 and it has already gained by almost 10.4% in the last 24 hrs. The Sharpe indicator predicts massive potential gains for KAVA. Let’s take a look at it in more detail.

KAVA Price Analysis: What is the Sharpe indicator?

KAVA Price Analysis of 30 Days:  KAVA/USD 30 Days Chart: Tradingview

The KAVA price Sharpe ratio calculated over the past 30 days of daily returns is almost 7.1. The Sharpe Ratio or Sharpe indicator is usually applied to calculate the performance of an investment by adapting for its risk. Now, the greater the ratio, the higher the investment return related to the significance of risk assumed, and therefore, the more solid the investment. The ratio can be utilized to estimate a particular coin or an entire portfolio.

In the case of KAVA price, the volatility calculated over the past 30 days of daily returns is sitting at almost 1.87. So, the calculated returns could be daily, weekly, monthly, or annually. Right now, the range between KAVA’s lowest and highest trading prices in US Dollars, over the last hour is $3.80 – $3.96 and the RSI is displaying a neutral behavior sitting at 68.78. The KAVA could be in the strong buy zone and the price has been consistently displaying a rising trend. The aggregate trading volume over the past 24hrs, in USD, is now $60,967,922.77. The KAVA price has gained almost 140% in the last 30 days and its price performance (ROI) over the past 7 days, vs USD, is increased by almost 40%.

Now, if you apply a Sharpe Ratio = (Rx – Rf) / StdDev Rx

Where:

• Rx = Expected return
• Rf = Risk-free rate of return
• StdDev Rx = Standard deviation of return

then the Sharpe Ratio’s grading is given below:

• Less than 1:                            Bad
• 1 – 1.99:                                  Satisfactory
• 2 – 2.99:                                 Very good
• Greater than 3                       Excellent

At the moment, if you calculate the Sharpe ratio of KAVA price from the past 90 days then it is almost 7.1. So, the KAVA price is maximizing returns and decreasing its volatility. Now, if a coin had a yearly return of only 9% but had zero volatility, it would have an undefined Sharpe Ratio and the zero volatility is almost impossible. Hence, the greater the Sharpe ratio, the higher the investment return.

KAVA Price Analysis: Bullish Momentum

KAVA Price Analysis 1 Day Chart: KAVA/USD 1 Day Chart: Tradingview

In KAVA price, the MACD lines have passed bullishly and the histogram has formed bullish in the past 30 days. If the KAVA price continues its growth, it could find strong support at $4.11 and $4.19. The encouraging thing could be its price performance (ROI) from the beginning of this quarter, to right now, vs USD. The price-performance ROI has been increased by almost 175% and its price performance (ROI) from the beginning of this month, to right now, vs USD, has increased by almost 40%.

Conclusion

At the moment, it will be too early to predict anything huge about KAVA’s price growth. The volatility calculated over the past 30 days of daily returns is 1.89 and it is satisfactory and its price performance (ROI) over the past 30 days, vs BTC, has increased by almost 91%. Overall, the KAVA price is showing promising growth and the Sharpe index is displaying the 7.1 and this could be a promising thing. We wish you happy trading!