Home News How traders can use Twitter to anticipate altcoin price moves

How traders can use Twitter to anticipate altcoin price moves

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When cryptocurrency traders strike it rich, they frequently resort to Twitter to share their excitement. They have a habit of doing the same thing when it comes to telling sad experiences of being destroyed, discussing exciting new assets, or offering insight and predictions on which initiatives will be the next great thing. These surges of social attention may sometimes produce positive feedback loops, in which the tokens that command the conversation see their prices rise exactly because of it.

The number of tweets mentioning a certain item might reveal a lot. Loopring’s LRC, NuCypher’s NU, Enjin Coin (ENJ), ANKR, and The Sandbox’s (SAND) were among the five tokens that witnessed the biggest month-to-month growth in daily tweet volume this month. This isn’t surprising, since assets with large rallies tend to get the attention of the Twitter audience.

Volume of tweets mentioning LRC, NU, ENJ, ANKR and SAND, Oct. 9 – Nov. 9. Source: The TIE

What’s amazing is that the record-breaking tweet volume peaks occurred not in response to monthly price highs, but rather ahead of them in each of the five occurrences. In other words, rather than reacting to price movements, the voluminous Twitter discussions around these currencies predicted them. How might traders pick up on the early indicators of this unusual social activity?

Heads-up from the crowd

There are few methods to properly catch each rise in tweets regarding a given commodity if you do not follow just about everyone on Crypto Twitter.

CT Markets Pro Unusual Twitter Volume panel, Nov. 11. Source: Cointelegraph Markets Pro

Additionally, tweet volume is one of several indicators used to generate the VORTECSTM Score, an algorithmic indicator that connects patterns of previous market and social activity around a digital asset with years of historical data performance to determine how bullish the coin’s prognosis is.

All of these currencies appeared on the Unusual Twitter Volume panel when their tweet volume peaked, therefore a check at raw Twitter data would suffice in the case of the month’s top Twitter darlings.

LRC/USD: A 744.44% rise in tweet volume was followed by a monthly price movement of +350.79%

The fact that the layer-two protocol continues to offer cheaper transaction costs than its peers, which comes in handy during excessive gas rates on the Ethereum network, is one of the factors in the monster climb of LRC this month.

LRC price vs. VORTECS™ Score (yellow/green), Oct. 8 – Nov. 8. Source: Cointelegraph Markets Pro

On Nov. 3 (the red circle in the chart), when the asset was reaching its local price top of $1.54, the amount of daily tweets mentioning the project outpaced the monthly average by more than 740%. LRC proceeded to soar even higher after a brief correction, buoyed by the rush of social attention, and broke above $2 six days later.

NU/USD: A 598.87% rise in tweet volume resulted in a monthly price increase of +179.18%

Nobody knows what caused NU‘s 10x+ pump on Oct. 15, but it saw the coin jump from $0.30 to over $3 in just a few hours. Some Twitter users attributed the increase to the company’s listing on the South Korean exchange Upbit, but there’s a chance something else was at work. People were most likely just trying to figure out what was happening.

NU price vs. VORTECS™ Score (yellow/green), Oct. 8 – Nov. 8. Source: Cointelegraph Markets Pro

In any case, barely two hours into the rise, the Unusual Twitter Volume indicator began to flash, with the maximum rate appearing immediately before the price high of $3.17. Surprisingly, social buzz over NU remained for a while despite the dramatic price drop, fading barely a day after the price dropped to roughly $1.20.

ENJ/USD: A 354.32% increase in tweet volume accompanied a monthly price move of +90.35%

Enjin Coin has benefited from the metaverse token frenzy sparked by Facebook’s rebranding to Meta in late October.

ENJ price vs. VORTECS™ Score (yellow/green), Oct. 8 – Nov. 8. Source: Cointelegraph Markets Pro

The Twitter debate about blockchain gaming platform Enjin peaked on Oct. 31 at $2.51, while ENJ was cooling off following a parabolic surge. The flurry of Twitter mentions signalled the start of the second phase of the rally, which saw the currency hit a new high of $3.45.

ANKR/USD: A 329.08% increase in tweet volume accompanied a monthly price gain of 39.51%

ANKR had a huge week at the same time when metaverse assets soared, increasing from $0.081 to $0.139 in a week.

ANKR price vs. VORTECS™ Score (yellow/green), Oct. 8 – Nov. 8. Source: Cointelegraph Markets Pro

The Twitter stats went into overdrive, surpassing 2,400 daily mentions while the token’s price plateaued for a breather during the increase. Following that, the token’s price jumped still further, reaching a monthly high on November 3rd.

SAND/USD: A monthly price movement of +222.12% accompanied a 328.12% rise in tweet volume

Following the Facebook/Meta announcement, the Sandbox was yet another metaverse marvel whose token price soared.

SAND price vs. VORTECS™ Score (yellow/green), Oct. 8 – Nov. 8. Source: Cointelegraph Markets Pro

SAND’s positive social outlook was evident when its daily tweet traffic more than quadrupled compared to the month-to-month average, reaching a new high of over 2,600 tweets 15 hours before the stock reached a high of $3.38.

Granted, an unusually high number of tweets referencing a certain item isn’t a guarantee of a price increase in the near future. To make an informed judgement, traders should look into the actual background of what is going on surrounding the coin. Being alerted to significant jumps in interest in specific assets, on the other hand, maybe extremely helpful in focusing one’s study on the most probable possibilities for a prolonged rally.

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