The emergence of DEFI in the crypto ecosystem has given investors an independent hand to trade any coins of their choice outside exchange platforms. Therefore, investors have upped their game to be the first to discover newly launched projects before they are listed on any exchange. This has always been the plight of many investors.
A lot of tools, like DEX screener have been deployed as scouting tools using different parameters, which are considered measures for investing.
Hence, we should not shy away from the fact that many investors have liquidated their investments due to a lack of proper information, considering how juicy a newly launched project [coins] might appear to be. It's important for investors to know certain parameters before investing in any particular crypto currency.
Things to consider before investing in a newly launched coin.
Many investors fail to consider some parameters before investing their funds in newly launched coins. it is not enough to find newly listed coin. some, through this lack of information, have liquidated their investments. Here I will be making a deep expository analysis of some major things you should consider before investing in any newly launched project.
- Age [time of release].
Every investor is driven by enthusiasm to get the first bite of every new coin. It is very important to first look at the time of release. Since the market does not have only one trader, a lot of people are really investing in different coins. If the coin were new, a lot of people would have invested in it. Be sure if the time of release is still short because many of these newly launched coins are just meant to attract investors and later liquidate them out of the market [they might probably be pump and dump coins]. If you are sure of the time of release, it will put you on the safer side of losing your funds. You definitely know whether to enter the market or not.
- Check the Buy and Sell [EMA].
Before investing in any newly launched coin, it's very crucial to check the exponential moving average [EMA], which will help you judge what trend the coin is moving towards, whether BUY or SELL so you won't be the pig in the market. If the coin has numerous selling trends, it indicates a red flag for investment, meaning the coin is trending toward the bearish point [dumping]. At this point, you have to make your own technical analysis before investing, but it's advisable that you don't invest.
- Philosophy.
Every coin has its own philosophy. That is, what they have come to achieve will give investors a focus on what the coin stands for, and the philosophy of the coin will give you a prompt as to whether you should invest or not. The philosophy of the coin should be what you should look for if you are willing to invest in any newly launched coins.
- Volume.
Before you invest in any newly launched coin, look out for its supply. If the volume of supply is less than the market cap, as an investor, it's important to know that such a coin will dump over time. Be very concerned about the supply of the coin before you invest your fund.
- Website.
Many of the newly launched coins are pump and dump coins, which are aimed at attracting investors and later making them the pigs in the market. If the new coin has a website, it will send a chill down the spine of every investor, making them understand that the coin has prospects in perspective. Although newly launched coins having websites does not determine its stability but it tells the coin has prospects with what it will achieve.
- Social media.
Another thing to look out for is the social media platform of the coin. If the project has a social media platform, it will give more information about the coin. Moreover, much of the basic information about the coin is mostly announced on their social media platform, which will create investment focus for any investors who want to invest in the coin.
- Can it be swap.
Many of these newly launched coins are mostly swapped with decentralized exchanges, which indicates that investors will be using contract addresses as a strategy for trading. The reason for the contract addresses is that many of the new coins are yet to be listed on any exchange. Investors, while trading these new coins, should be careful if the coins can be swapped with other coins. Hence, you might only be able to buy the coin but won't be able to swap it with any other coin. Check first if you can swap it.
Disclaimer.
All this is just to help you be careful. It's never a yardstick to buy ignorantly, nor is it financial advice. Do your due diligence before investing.
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