This strategy aims to minimize losses and maximize profits by focusing primarily on projects with available mints rather than investing when markets have already settled. It is best paired with on-chain analysis software for cross-referencing similar projects or major holders.
Basic Flow Order
- Use on-chain analysis tools, check for the latest mints.
- Utilize your favorite metrics to determine the viability of the project.
- Inspect the project's roadmap and how "active" developers are with the community.
- If things appear strong, mint.
Understanding what to look for is critical for making more hits than misses. The great part of this strategy is that opportunities come every single day. There's no time for feeling remorse over what could have been when there's a could be right around the corner. It is wise to take your time to watch mints go by and find which ones did well and which factors lead to the highest chance of success. Do this for two weeks, and you'll have more understanding than the majority of the people minting.
Metrics is a meaty topic that could be prodded at all types of angles. Depending on experience and market climate, these are all subject to change. A good trader in one environment is a horrible one in another. Make sure that the metrics that you value, the market does too.
Briefly, I'll touch on some of the metrics I find to be helpful.
- Increasing delta between highest and lowest sale with a rising floor is very bullish.
- Total unique addresses slopping predictably without any disturbances is bearish.
- The greater amount of influential holders within a project, the higher chance of success.
There are many other indicators, and I will leave that for you to find and craft your very own. But, first, take into consideration what brought you into your first NFT project. Emotions, utility, and hype are all valid "metrics" to base your investment decision on as well. Numbers are sexy because they give us a sense of "true understanding," but don't be fooled; investing is as much or more emotional than it is numerical.
Investors aren't numbers. Investors are people.
The actual difficulty of this strategy is determining for yourself which metrics have the highest return %. The easy part is finding the tools you will need.
Free - Etherscan
On-chain analysis tool will quickly give you a rundown of a project's current holders and the % each is holding.
Free - Opensea Activity Page
Feature of the most prominent NFT market place which shows you the raw latest purchased data. Lots of junk, but occasionally, you will stumble upon a gem the others will be missing.
Paid - Nansen
On-chain analysis tool that is like an Etherscan but built out for traders. My favorite feature allows you to see the latest mints of large traders. I consider this a level higher than Opensea's activity page.
If there seems to be a demand, I can write an article for each particular tool and how I use them.
It will take some time to get the hang of things. You will occasionally mint projects that end up worthless, and you will occasionally mint useless projects that end up invaluable, take what you learned and apply it to the next investment. Start slow. Nothing in this space is "once in a lifetime". You will get your chance to shine as long as you don't burn out in the process.
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