Three tricks for picking coins—useful in both bull and bear markets
1. Watch volume, not price. Price charts can be manipulated; volume represents money flowing in and is harder to fake. If a big bullish candle has lower volume than the previous five days, it may be a bull trap—stay away. At low levels, if volume keeps increasing but the price won’t fall, buyers may be stepping in; keep an eye on it. Rallies on no volume are nonsense; don’t buy into a high-volume drop.
2. Pick coins people actually trade. Look for high trading activity: add the top 20 coins by average daily volume over roughly the past two weeks to your watchlist. If nobody trades a coin, a market maker can pump it and leave you holding the bag. Mainstream coins have more participants and better liquidity, making them easier to buy and sell. Avoid low-volume altcoins.
3. Use weekly charts for the big picture and 4-hour charts for short-term trades. A weekly MACD golden cross below the zero line, or a turn up from the bottom, suggests potential on the larger timeframe. If the weekly trend is down, don’t touch it, no matter how cheap it looks. For short-term trades, switch to the 4-hour chart and wait for the moving averages to align bullishly and the price to reclaim a key level before acting. The larger timeframe sets the direction; the smaller one helps find entry points.
These three tricks aren’t hard, and they help you avoid pitfalls. Taking three minutes to pick a coin is more useful than listening to ten people shout their calls. In a bull market, hot coins rise quickly; in a bear market, coins with volume fall more slowly. The same applies to spot and futures: avoid coins with no volume, and when volume appears, wait for the right level.
1. Watch volume, not price. Price charts can be manipulated; volume represents money flowing in and is harder to fake. If a big bullish candle has lower volume than the previous five days, it may be a bull trap—stay away. At low levels, if volume keeps increasing but the price won’t fall, buyers may be stepping in; keep an eye on it. Rallies on no volume are nonsense; don’t buy into a high-volume drop.
2. Pick coins people actually trade. Look for high trading activity: add the top 20 coins by average daily volume over roughly the past two weeks to your watchlist. If nobody trades a coin, a market maker can pump it and leave you holding the bag. Mainstream coins have more participants and better liquidity, making them easier to buy and sell. Avoid low-volume altcoins.
3. Use weekly charts for the big picture and 4-hour charts for short-term trades. A weekly MACD golden cross below the zero line, or a turn up from the bottom, suggests potential on the larger timeframe. If the weekly trend is down, don’t touch it, no matter how cheap it looks. For short-term trades, switch to the 4-hour chart and wait for the moving averages to align bullishly and the price to reclaim a key level before acting. The larger timeframe sets the direction; the smaller one helps find entry points.
These three tricks aren’t hard, and they help you avoid pitfalls. Taking three minutes to pick a coin is more useful than listening to ten people shout their calls. In a bull market, hot coins rise quickly; in a bear market, coins with volume fall more slowly. The same applies to spot and futures: avoid coins with no volume, and when volume appears, wait for the right level.
