First, this method takes a bit of work. Low-marketcap coins are very risky, but the potential rewards are high. This strategy has worked well on multiple coins: PIE, AMS, LINDA, CXT, and CV2.
Research is King
Make sure to read everything published about the coin you are looking at. Go to the ANN page on bitcointalk. See if there is some fundamental event that could drive up the price. A coin swap, news of masternodes, adding to an exchange, etc. I will give you an example of a current one:
CV2 has been around a long time. It is supported by many established members on bitcointalk. Be wary of newbies. The coin count is quite insane, but they are doing a coin swap in a couple weeks. The swap is 2:1. And upcoming masternodes. I found this thread before the swap news and started following it. I joined the cv2 Slack.
News events in crypto have a way of driving price to stupid levels. You can take advantage of them. It is not my intention to hodl any of these coins. I am in and out quickly. Sometimes, I will hodl a few leading up to a swap . . but I do not hodl MN coins. The ROI is way too long when you can literally double or triple your money by flipping the coins in a few days or a week. It might take a year to get ROI on a MN. I'm sure others have different techniques, and that's perfectly fine, but it's not mine.
Look at Litecoin and Doge Coin Pairings
The coin, at the time I bought it, was selling for 1 satoshi in btc on exchanges. But, it could be purchased with LiteCoin for around 40-50 sats on Nova. I didn't market buy the cv2. On Nova, the spreads are quite large. Placing buy orders and waiting for a fill is the way to go. You really have to look at the order book. Check out where the sell walls are. I typically will place my sell 1 satoshi under the wall. Same on the buy side. I will place my order 1 satoshi higher than the wall. At the time, there were buy walls of 50 Litecoin for cv2. On an exchange like Nova, this is a large wall.
Some of My Trade History
You can see that all of my buys and sells were done with the ltc pairing not the btc pairing. I still have about 15 million cv2 left and have profited about 15 ltc from selling. Cryptopia has delisted cv2 now, so all of my trading will now be done on Nova. Is this risky? Yea, absolutely. But after getting some experience . . you will be able to see which of these coins have good short term profit potential.
In Summary
- Don't be afraid to utilize bitcointalk.org. That is a great resource.
- Follow the coins Twitter page. Turn on notifications so you don't miss the news as soon as it hits.
- Watch for fundamental news driver, such as coinswaps, MN's, adding to exchanges, website release, etc
- Join the Telegram, Discord, or Slack. I personally like Slack the best.
- Analyze the order book.
- Check out the Litecoin pairings.
- Watch for consistent increase in volume.
- Set a sell of half your purchase at double the price. The rest is a free position.
- Is the community active and growing? DAS coin dev abandoned and the community took over the project.
I understand that this isn't the typical way people trade, but it has worked out very well for me. I like this strategy, in addition to my charting techniques for more heavily traded coins on exchanges like Bittrex. Again, make sure you research these coins thoroughly and only risk what you can afford to lose.
Links:
This website shows you ROI on MN coins: http://masternodes.pro/
CV2 ANN for reference: https://bitcointalk.org/index.php?topic=941433.0
I have added hyperlinks to all the coins I flipped recently at the beginning of the article. I do not recommend buying them at this time. But there will always be more coins. Please, do your own research. Any questions? Drop them below and I'll do my best to answer them
Stick with the leaders. BTC, ETH, XRP, NEO - this space will exceed one trillion market cap within 3-5 years. Don't time the market, invest in it.
I agree with this as well @decentralization . . this is a strategy I employ often to make short term profits.
I have BTC (of course), ETH, LTC, Stratis, WAVES, STEEM, EXP, XBY . . most everything else, I trade.
Whose to say that these low market cap coins wont exceed where BitCoin is now (under 100 Billion) when BitCoin does reach the 1 Trillion dollar market cap?
BitCoin is a great coin, but it is not the only project being worked on in the blockchain world.
My strategy... Research research research, and do some more research, and when your at your REAL job, RESEARCH!!!
Find low market cap coins that have high potential. Check out their community, their developers, social media platforms, read all the content you can on their social media platforms, every tweet, every post on Bitcointalk from every member, who does what in a community.
Check out their project goals, read their whitepaper and their read map.
If your not spending hours on a coin researching it because it has none of that... Then it's a worthless coin. However some of these low market cap coins have very strong communities as well as goals in mind.
Just do all your research and make your best judgement on how much money you think you can lose on that project. Some projects are more worthy than others.
Nice post, I probably will employ some of your techniques in the future. Your way of making money seems to be very sophisticated. How much time do you spend per day on doing research or just being informed about everything?
What I also didn't really understood; Why do you recommend looking at LTC or DOGE pairs instead of BTC pairs?
I would enjoy to read more posts like this from you, that's why I am following you now.
Yea, I do spend some time researching and looking for these coins. I'll spend a couple hours charting and researching, etc . . on both low cap and high cap coins. Sometimes, I will hear about them in another coins Slack group. But once the initial research is done, I just make sure to stay up to date on the news . . that's the easy part.
You can buy a lot of these coins cheaper than 1 satoshi of btc. It doesn't seem like it would be a lot, but with cv2 for example, I purchased about 20 million coins. that would be 1/5 of a btc if I would have bought that way. But at the time, there was a lot more volume on the ltc pairing, and the order book looked a lot easier to make a profit with. The sell walls were very slim and the buy walls were quite large.
I'm sure there are people out there who make a good living buying coins with ltc and doge, and then selling them for btc. Here is a calculator that converts the amounts.
https://www.coingecko.com/en/price_calculator/litecoin/btc
I know its not for everyone, but there is profit to be made. When the entire market flipped to bear a couple months ago, the lower cap coins were still shining.
Thanks for your comment. I enjoy making posts and comments help me to see that this is worthwhile.
Those other pairs might react later to actual news, just a wild guess, but you can't trade if there isn't volume...
I got into pie after a post you and I were in about this same type of concept. Great returns and looks like masternodes coming in around September 11th. In and out of Linda for a good profit too. Great post and there are some hidden gems out there like you said. The extra time and research is worth the returns
Great ! That's what's up. Yea, I feel kinda bad for the people who are hodling Linda after buying it above 10 sats. You're right though. In and out is the way to go on a lot of these coins. Thanks for your comment.
Nice informative post . Buy low sell High !
You know it! Thanks!
Cool post i will up vote a follow you - Pie has been good to me for the last few weeks are you just waiting for the master node s in September. The wallet is so fast - I can send and receive coins on and off cryptopia in just a few minutes or less.
Yea, it sure is. Even though I sold all of my PIE, I still think that it has very good potential. Thanks for your comment.
good post ...like it and upvoted!!
Thank you :)
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STOPThank you for this post I up voted this and I am following you because it is a really educational bit of info that I need to study.I will be checking out bitcointalk also. Probably going to read again so it will sink in better.
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STOPWhich exchanges have the lowest volume coins?
great work done!nice post,i have followed and upvoted you,if you like technology,please follow me