Cointelegraph Markets Pro gives members access to multiple strategies to find crypto weekly winners.
This article describes how to use two overlooked indicators that, based on historical data, have been able to alert traders to possible massive price increases. These indicators can also be indispensable tools for asset discovery.
When these indicators are abnormally high, they warrant a closer look at the highlighted assets to investigate the reasons behind the abnormal volume dynamics.
Before you dive in, it's important to understand this point: Cointelegraph Markets Pro is comprised of multiple AI-powered real-time indicators that give members multiple opportunities to enter select assets before, or just as, their prices take off.
These indicators can be used individually or together to make informed trading decisions. And that's why, each week, members can expect to find winning alerts.
The trading strategy discussed below is based on these two often overlooked metrics:
Below are eight simple steps to follow for this trading strategy:
Step 1: Go to the scanner and sort by Sentiment of positive tweets.
Step 2: Look for assets with 60% or more Positive Tweet Sentiment.
First, be sure to customize the scanner view, so that the positive sentiment of the tweets can be seen. Then click to add the Positive Tweets Sentiment column to the view:
Positive tweet sentiment, by the way, is the percentage of positive tweets about a cryptocurrency in the last 24 hours. The higher the better, but the goal is at least a 40% to 60% increase.
Step 3: Search for assets with a minimum of 200-400 tweets in the last 24 hours.
Ignore all high sentiment tokens with too few tweets because these assets are likely to return a false positive. The higher the number of tweets, the more likely it is that something positive will happen to the asset price.
Stage 4: Find assets with tweet volume that is 50% or more above average.
Tweet vs Average measures how much tweet volume an asset has today compared to its 30-day moving average, so a value of 50% means that an asset's tweet volume is 50% higher today than it was one day average.
This indicates a significant and unusual increase in tweet volume. Such a rise tells us that something is up with this asset, alerting members to a possible price breakout.
To investigate these signals, alerts should be verified by following these steps:
Step 5: Look for price divergences (flat or bearish movements on the chart).
Let's see an example with Gitcoin (GTC):
Positive tweets Sentiment above 60%? Check.
At least 200โ400 tweets in the last 24 hours? Check.
Tweet volume at least 50% above average in the last 24 hours? Check.
Now, let's see where the asset price goes. It's best if it's flat, meanders to the sides, or dips a bit.
Step 6: Make sure there is enough trading volume!
Gitcoin is a small-cap altcoin, so it can be a bit tricky to find liquid exchanges to trade this asset. With smaller altcoins and other less liquid assets, trading volume is volatile and inconsistent, so keep availability and trading pairs in mind.
A minimum trading volume range of around $200,000-$400,000 is recommended depending on the pairs available on the specific exchange for optimal liquidity, but for smaller altcoins like GTC, the trading volume will be much lower.
Step 7: See what the Twitter buzz is all about.
Go to Twitter and find out what's going on with the asset! Maybe there's an update, maybe it's a protocol change, or maybe the company behind the asset finished a fundraiser.
Read the threads. Get an idea of โโwhat's going on.
No matter what, check without guessing. It is part of the due diligence process before taking the final step. This information is vital in determining whether to make the trade, wait and monitor, or pass it on.
Step 8: Set a limit order to take profit at a comfortable rate of around 5% to 10%.
After, and only after, checking the alerts by following the steps above, don't forget to set up the trade to make some profit. To beat the current rate of inflation, an easy number to use is 10%, but that's for each member to decide. By setting a take profit limit order, one can ensure a successful return on every winning trade.
By following these eight easy steps, Markets Pro members can find multiple weekly crypto gainers based on the Twitter Unusual Volume and Unusual Trade Volume indicators.
This is just one of many strong trading strategies that members can take advantage of by customizing their alerts through the Markets Pro platform.
To see how Cointelegraph Pro Markets delivers data that moves the market before this information is public knowledge.
Cointelegraph is a publisher of financial information, not an investment adviser. We do not provide personalized or individualized investment advice. Cryptocurrencies are volatile investments and carry significant risk, including the risk of permanent and total loss. Past performance is not indicative of future results. Figures and graphs are correct at the time of writing or as otherwise specified. Live tested strategies are not recommendations. Consult your financial adviser before making financial decisions.
All ROIs quoted are accurate as of January 31, 2023.
