Now the best returns.
Coinglass Research Institute: Different investors have different investment methods, risk tolerance, and investment goals. Therefore, they also have different choices when it comes to analyzing market data indicators. Changes in market environment and trends can affect the value of certain indicators, making them more meaningful at certain times and less important at other times. While each indicator has its unique role and significance, in practical application, a single indicator often fails to comprehensively reflect the market situation. Therefore, it is recommended that investors consider multiple dimensions of data indicators for comprehensive analysis and judgment in order to more accurately grasp market trends and investment opportunities. Utilizing multiple data indicators, such as fundamental data, technical analysis indicators, and market sentiment indicators, helps investors gain a more comprehensive understanding of the market, reduce the misleading effects of single indicators, and improve decision-making accuracy and efficiency.
OKX Strategy Team: Currently, certain dimensions of data indicators in the cryptocurrency market may be underestimated, but they hold relative importance for market analysis and investment decisions:
1. ETF Fund Flows
The inflow and outflow of funds in cryptocurrency ETFs can reflect institutional investors’ market attitudes. A large inflow of funds into ETFs usually indicates that institutional investors are optimistic about the market outlook, while outflows may suggest a weakening of institutional confidence in the market. Analyzing the fund movement of ETFs can help users judge the medium to long-term market trends.
2. Options Market Data
Options market data includes implied volatility, open interest of call and put options, and more. These data reflect the market’s expectations for future price volatility and can provide forward-looking indicators of market sentiment. For example, changes in implied volatility may indicate significant price fluctuations, and an increase in call options may suggest a bullish market expectation.
3. Stablecoin Flows
The inflow and outflow of stablecoins (such as USDT, USDC) can reflect market fund movements and investor hedging demand. When a large amount of stablecoins flows into exchanges, it may indicate that investors are preparing to buy cryptocurrencies; conversely, stablecoin outflows from exchanges may indicate investors cashing out. Analyzing stablecoin flows can provide clues to fund movements.
4. Network Effect Metrics
Network effect metrics include active user numbers, developer activities, social media attention, etc., which reflect the network effect and ecosystem health of blockchain projects. A strong network effect usually implies higher project stickiness and growth potential, suitable for medium to long-term investment decisions.
5. DeFi Activity Metrics
These include Total Value Locked (TVL), the number of users in DeFi protocols, lending and liquidity provision conditions, etc. DeFi activity metrics reflect the health and growth potential of the decentralized finance market. High TVL and active user participation usually indicate strong demand and growth potential in the DeFi market.
Coinglass Research Institute: Cultivating a scientific trading mindset requires systematic learning and practice. Here are some mature methodologies:
1. Maintain objectivity and rationality:
Develop a detailed trading plan and execute it resolutely, free from the influence of market emotions.
2. Learn data analysis and risk management:
Master technical analysis and fundamental analysis tools, and learn to set stop-loss and take-profit points.
3. Accumulate trading experience:
Record the reasons, process, and results of each trade, summarize and reflect on them, gradually establishing an effective trading system.
4. Maintain an open mind:
Continuously pay attention to industry news and expert opinions, update knowledge, and remain sensitive to market changes.
5. Establish trading rules:
Establish clear trading rules and strictly adhere to them, avoiding the influence of greed or fear.
6. Conduct simulated trading:
Utilize simulated trading platforms for practice, validate and refine trading strategies, and reduce errors and losses in real trading.
7. Learn quantitative analysis:
Master quantitative analysis tools, construct and test trading strategies to ensure their effectiveness and stability.
8. Regularly review and adjust strategies:
Timely adjust and optimize trading strategies based on market conditions and experience, maintaining their effectiveness and adaptability.
OKX Strategy Team: From our experience, becoming a mature investor requires improvement in three areas:
First, master fundamental data and indicators:
1. Understand macro trends:
Understand basic economic indicators (such as GDP, inflation rate, interest rates, etc.) and their impact on the market.
Pay attention to the impact of global geopolitical dynamics and major events on the cryptocurrency market.
Understand the market cycle and long-term trends of cryptocurrencies.
2. Price and technical analysis:
Thoroughly use the principles and applications of commonly used technical indicators (such as moving averages, RSI, MACD, Bollinger Bands).
Master the identification methods of trend lines, support levels, and resistance levels.
Understand the identification and analysis of market structure (such as highs, lows, trend channels, etc.).
3. In-depth fundamental analysis:
Learn to analyze the whitepapers of cryptocurrency projects, team backgrounds, and technical roadmaps.
Deeply understand token economics, including supply mechanisms, deflation/inflation models, use cases, etc.
Continuously monitor industry dynamics, technological innovations, and regulatory environment changes.
Second, cultivate analysis and decision-making capabilities:
1. Maintain critical thinking:
Learn to question and verify information sources, especially market “hotspots” on social media.
Cultivate the ability to think from multiple angles and consider the possibility of opposing viewpoints.
Learn to identify signs of market sentiment and overreactions.
Cultivate independent thinking and avoid blindly following “expert” opinions.
2. Build systematic trading strategies:
Develop clear trading plans based on personal risk tolerance and investment goals.
Set clear entry and exit rules, including stop-loss and take-profit points.
Learn to use different types of orders (such as limit orders, market orders, conditional orders) to execute strategies.
3. Establish strict trading discipline:
Develop a habit of checking analysis before each trade to avoid impulsive trading.
Strictly adhere to pre-determined trading plans and risk management rules.
Learn to control emotions, especially when facing significant profits or losses.
Establish a trading journal to record the reasons, results, and emotional states of each trade.
Third, practice and continuous improvement:
1. Systematic review and optimization:
Regularly review trading records, analyze the reasons for success and failure.
Evaluate strategy performance using quantitative methods such as the Sharpe ratio, maximum drawdown, etc.
Continuously optimize trading strategies based on market changes and review results.
Learn from failures and view each loss as an opportunity for improvement.
2. Maintain learning and market sensitivity:
Pay attention to the viewpoints of industry-leading analysts, but cultivate the ability to independently verify.
Continuously monitor new developments in financial technology, such as DeFi, NFTs, cross-chain technology, etc.
Learn cross-market analysis and understand the relationship between traditional financial markets and the cryptocurrency market.
The above is the second issue of the “Insights into Data” column launched by OKX, focusing on the different data dimensions needed for reference in various user scenarios. It is hoped that it will provide a systematic data methodology for traders of different experience levels to better grasp market trends and make wise trading decisions. In future installments, we will continue to explore more practical data usage/analysis methods to provide references for traders’ learning and investment.
Risk warning and disclaimer:
This article is for reference only. The views expressed in this article represent the author’s views and not those of OKX. This article is not intended to provide (i) investment advice or investment recommendations; (ii) an offer or solicitation to buy, sell, or hold digital assets; (iii) financial, accounting, legal, or tax advice. Holding digital assets (including stablecoins and NFTs) involves high risks and may experience significant fluctuations. You should carefully consider whether trading or holding digital assets is suitable for your financial situation. For your specific situation, please consult your legal/tax/investment professionals. Please be responsible for understanding and complying with applicable local laws and regulations.
This article is the official content provided and does not represent the position or investment advice of this platform. Readers must conduct careful evaluations on their own.
Successful Conclusion of CoinEx Taiwan’s 7th Anniversary Celebration, Embracing the Arrival of the Web3 Era Hand in Hand with Users
Since its establishment in 2017, CoinEx has been a professional cryptocurrency trading pla…