How do you use market cap and market volume data for your trade? Are they helpful for you?

[Brushless4500KV 4214]

There are lots of data we can analyze to improve our trades. I know that professional trading is not only about checking prices every day. We should analyze other hints and clues to predict what will happen. Trading without prediction is not very profitable. To make good predictions we need other data such as market capitalization and market volume. When we talk about market cap we refer to total circulating supply of any coin times its price. This seems to be an important factor in crypto trading because most articles that I read, have referred to it. Market cap will indicate that even a coin with less price can have more value than another coin with more price. This is where the concept of circulation stands out.

Market volume definition is clear to most of us and doesn't need any explanation.

Now, my question is that how can we use these two metrics to gain benefit from crypto trading?

Do you always look at them when you are trading?

 

[sdsonjoy50 886]

coinmarketcap This site helps me a lot in trading, I do a lot of help to market volume, market price, market analysts, I use this site regularly, you can use it too.

[Brushless4500KV 4214]

I can communicate what I mean better with an example.

Suppose we have two coins. X & Y.

 

Coin X has a value of $10. Its market volume is 20 and has a market capitalization around $200.

Coin Y has a value of $2 but its market volume is 10 and has a market capitalization around $1400.

 

Please note that I simplified the numbers just for easier calculation.

 

According to what I know, the total value of each coin is calculated as the following:

 

Total value of Coin X = 10 x 200 = $2000

Total value of Coin Y = 2 x 1400 = $2800

 

According to above data, which coin is better for investment? How do you analyze these two coins? Do you prefer higher capitalization to higher price?

 

 

 

[Crypto123 0]

In general I look at the Volume of the market, I use this information available in Queen Market Cap when I trade in a currency that is not one of the major currencies known, then I do a search to find information about this currency when it started and what is the market Volume  and the daily trading volume and other things As for currencies Principal. I think you do not need to look at this information on a daily basis, but rather you need to monitor daily price fluctuations and wait for the right moment.

[Brushless4500KV 4214]

When we talk about market cap there are three categories of crypto coins:

 

1 - Large-Cap coins - These coins have a high market capitalization. They have more than 10 billion dollars market cap. Bitcoin and Ethereum are categorized as Large-Cap coins because they usually have more market cap than any other coin. Large-Cap coins are the least risky coins to invest.

 

2 - Small-Cap coins - These coins have the lowest amount of market cap which is below one billion dollars. Although some of these coins have high prices, they are still too risky to invest because they have the least amount of circulation.

 

3 - Mid-Cap coins - These coins are somewhere between the other two and their market cap is lower than 10 billion dollars. It is relatively safe to invest in these coins. Ripple and Litecoin are two prominent examples.

[febriyana 934]

16 hours ago, Brushless4500KV said:

I can communicate what I mean better with an example.

Suppose we have two coins. X & Y.

 

Coin X has a value of $10. Its market volume is 20 and has a market capitalization around $200.

Coin Y has a value of $2 but its market volume is 10 and has a market capitalization around $1400.

 

Please note that I simplified the numbers just for easier calculation.

 

According to what I know, the total value of each coin is calculated as the following:

 

Total value of Coin X = 10 x 200 = $2000

Total value of Coin Y = 2 x 1400 = $2800

 

According to above data, which coin is better for investment? How do you analyze these two coins? Do you prefer higher capitalization to higher price?

 

 

 

If you ask me that question, here my answer

For investment purpose, if only see the price, volume, and marketcap. This is not included internal and other analytic, like what project, progression, and etc.

 

Coin X has a value of $10. Its market volume is 20 and has a market capitalization around $200.

Coin Y has a value of $2 but its market volume is 10 and has a market capitalization around $1400.

 

I prefer choose Coin Y, because i will first look on marketcap, marketcap is like mirror how many people want throw their money in circulation coin Y. 

Then i look on price. Price is really cheap!

Last i see volume, this coin is have low competition!

That is my opinion. 

[nicolas1234789 2566]

I use coinmarketcap to find coin information, specially about their market. About price data I'll go into exchanges because they have real data market. As bounty hunter, coinmarketcap help me find market, besides that none.

[Pro0XD0Bro 2]

Я не использую эти данные. Хотя сам же понимаю, что поступаю неправильно. Мне хватает новостей и технического анализа.

[uacmiui 2]

Without this resource, it is simply not possible to trade), it is a pity, of course, I used to trade purely by candlelight, and the profit could be even greater.

[Brushless4500KV 4214]

Have you ever thought why most crypto websites rank coins based on market capitalization data? When I visit CoinMarketCap, bitcoin is always the first rank. Is it because market cap is the most important variable of any coin?

The same story applies to exchanges too. They put BTC at the top of their charts. So, it seems that market cap is too vital for every one who wants to compare coins. Now suppose we wanted to rank all variables from highest to lowest. How would you rank them?

 

Market Cap > Market Volume > Price > Circulating Supply

 

Does this seem reasonable to you? If you think the order of importance is wrong, you can suggest a new order.

[Brushless4500KV 4214]

Now, lets talk a little about hidden data. Suppose someone invests a huge amount of money in BTC market but hides his investment from public and keeps it as a secret. In this situation the market cap data we see in some websites is not true. I'm not talking about manipulated or false data, I'm just referring to data which exists but not available to the public. If something similar to this happens, many of traders may trade based on defective data and make wrong decisions. Market cap and volume data are valuable only when the data is complete and real. I have heard that there are lots of companies who have invested secretly on crypto without letting anyone know about it. What do you think about this situation? Is hidden HODL really harmful to the market?

Edited December 11, 2019 by Brushless4500KV

[xprince1996 865]

On 12/7/2019 at 10:13 PM, nicolas1234789 said:

I use coinmarketcap to find coin information, specially about their market. About price data I'll go into exchanges because they have real data market. As bounty hunter, coinmarketcap help me find market, besides that none.

Yeah coinmarketcap is really a good place for bounty hunter to gather the information they need to a coin. Besides being a bounty hunter, I love coinmarketcap because I can see the historical price of the coin so that I can know when I can enter the market.

[dinabolt 514]

I use coinmarketcap to find coin information already listing or not. I need this information to avoid scam project and find the best price that I can use for trading. Not always successful but at lest I can avoid many scam project than last year.

[Opinder 1310]

Whenever you trade you should focus on low maket cap stock because it has potential to grow. And you should check trading volume because when trading volume increases price of stocks also rises and when volume falls price of stocks also falls. 

[Brushless4500KV 4214]

On 12/29/2019 at 6:22 PM, Opinder said:

Whenever you trade you should focus on low maket cap stock because it has potential to grow. And you should check trading volume because when trading volume increases price of stocks also rises and when volume falls price of stocks also falls. 

So, according to your advice, market volume plays a more important role than market cap. Does it mean that market cap doesn't lead to price increase? I have seen some coins that went down in volume but their prices still grew. What do you think will happen if the market volume of a coin goes down but its market cap increases or remain steady? How this situation can affect the price?

[Pearls Before Swine 815]

On 12/6/2019 at 8:20 AM, Brushless4500KV said:

Market cap will indicate that even a coin with less price can have more value than another coin with more price.

No, it doesn't indicate anything like that. 

 

Market cap is strongly affected by how many coins are in circulation, and that varies greatly from coin to coin.  Dogecoin has a relatively high market cap because it has over 120 Billion coins.  People put way too much emphasis on market cap when they're discussing whether a coin is a good one or not.  You can't go by that, because it's a number that doesn't really tell you anything of value.

[gigabyteRTX 1583]

Well, of course, I use those data to analyze first before I engage in trading, I always monitoring the movement of the coins that I'm trading and if I know or if my prediction is right then I will do a move to buy and sell my coins, but we all know not all prediction is accurate, so I more rely on the graph and analization, and it really helps me on trading.

[duncun007 3577]

well from coinmarketcap i can see how much is the total supply for the coin and fro how long has it been in the market and we all know coinmarketcap dont list scam coins and even the one listed they show you it does not have a volume at all.

[Harris123 281]

It depends on your lot size in my opinion.So these have the  great importance before putting trades.

[Shaza Ahmad 1682]

I think the cryptocurrency market is completely changing according to supply and demand, and the volume of exchange in a currency shows us a lot of useful information for expert traders.

[Jhadhasan 872]

After I do a technical analysis and before I made the purchase decision, I have to look at the market value and the size of the market, and if I find it in line with my decisions, I take the decision with boldness, and if I find it contradicts my decision, I back away from contracting any deal.

[Sasaki 171]

There are a lot if strategy in trading and yes market cap can help you analyse the market movement so you can know if your decision can make a enough profit or not. 

[bentayebsalah 2280]

Yes, using market data and information will be beneficial to your Tadawul and in order to know the direction of market movement in order to succeed in achieving profits

[jacker 1095]

I did look at it when trading. I use coinmarketcap to determine the volume, but it's not always honest, but overall it's okay. I look at prices, volume and the market and there are many more things for me to determine the best investment for me

[bliznec 22267]

I always choose coins with the lowest cost, but I always look at the volume of trading. This is very indicative of the fact that trading volumes are always shown to be large.