It is very important to understand the profit is ensured in most cases when you buy a coin, not when you sell a coin.
Tips for identifying undervalued low-priced coins for investment.
Tip No. 1
Go to www.coinmarketcap.com, and click on view all.
Order by market cap in $.
Scroll all the way down to the coins with a smaller market cap than $250,000 (these are the ones that can be the mega-winners over time).
Note down all the coins below this mark with a low to medium coin supply i.e less than 50m. For all of these,
Also note down their 24H volume in $.
Cross out the coins with a lower than 2% market cap to volume ratio (if X has a market cap of $100k, it’s 24H volume should be $2000 or more). This is simply to filter the microcaps that are getting a decent amount of attention.
From these remaining coins, cross out all the coins that have a far greater total supply than their circulating supply (this is usually indicative of a large premine, — there’s plenty of coins to pick up without this added liability).
The ones you’re left with (there’s usually quite a few) are the ones you need to do further research on.
Tip No. 2:
Head over to Bitcointalk, and read through the announcement threads of every single coin that you have left on your list.
Make a note of the level of activity in the thread, the number of pages it contains, the last time there actually was communication on there (some coins will be dead ones), and get a general feel for the community of each coin.
Read through the announcement itself to find out where the coin has come from and where it is heading — look for roadmaps, Slack and telegram channels, and active devs. Have a look at their websites and explorers.
Remove coins from the list of remaining ones that do not have at least a decent standard for all of the above (room for improvement can be a profitable thing).
Tip No. 3:
You should now have a smallish number of coins on your list. These are the ones you’re looking to pick up, but reudce the number down even further by doing further research on how they are currently trading on the exchanges, CoinExchange, NovaExchange and Cryptopia are great for microcaps.
Look at the charts for each of these coins, and spot accumulation patterns: constricted ranges with mid to high volume; spikes of high buying volume etc.
Another research tool is the Block Explorer for these coins. Some may have rich lists or largest wallet tabs. Keep tabs on movements within these addresses. Are the largest wallets getting larger over time or are they being depleted? Screenshot the top 25 richest addresses and then screenshot the top 25 again a few days later.
Compare your lists. Are these coins being accumulated?
Tip No. 4:
Take the plunge and buy the ones you’re most confident in. It may take you weeks to accumulate a decent amount of any single coin. And it most likely will take months before you start seeing serious returns on them.
Note: The above is a not an investment advice.
Follow me at https://steemit.com/@atifiqbal1985
Great post and tips Sir! will definitely apply it the next time I invest on altcoins!
Thanks
Great quote and great advice! If you get the buy side right, you literally cannot lose and it's just a question how much you want to make. Here is my Top 10 list for this week: (I also try to take the same approach to my buying) Thanks!
https://steemit.com/cryptocurrency/@cryptosphere/top-10-cryptos-of-the-future-july-29-2017-a-weekly-ranking-of-the-best-place-to-put-your-money-in-the-cryptosphere
Sure. Thanks for reading and your appreciation. I'll go through your post. :)
I just started researching crypto, let alone investing, but this seems like some of the most sound insights I have read. Most bloggers on steemit I have read are giving out their personal speculations with the disclaimer "but don't trust me, do your research!" without actually educating their readers on how and what to research.
You're teaching us to fish!
I'm sharing the experience with how I research. And I do read articles and videos people share about speculations. They share good points at times giving you insight into a coin... However at the end of the day, the risk as well as research is my own responsibility.
Congratulations @atifiqbal1985! You have completed some achievement on Steemit and have been rewarded with new badge(s) :
Click on any badge to view your own Board of Honor on SteemitBoard.
For more information about SteemitBoard, click here
If you no longer want to receive notifications, reply to this comment with the word
STOPHi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:
https://medium.com/@daytradernik/picking-out-microcaps-101-2215a5782691