Author: IT4Igm
Translated by: Deep Tide TechFlow
The J-Curve of Cryptocurrency, perhaps one of the most important methods that market traders need to learn.
If you are not an experienced sniper who prefers to buy cryptocurrencies only in safe situations, or just an emotional trader trying to make sense of things, then this article is for you.
Phase One
The main participants are skilled snipers with technical advantages, insiders/pre-sale merchants with unfair advantages, and speculators who prioritize quantity over fundamentals.
In most cases, regular traders fail here, as the speed of decline and rise is as fast as when speculators move on to new shiny things.
Phase Two
The enthusiasm wanes, speculators exit, trading volume shrinks, holders’ average uPNL is lower than profit, and influencers slowly fade out of the scene through marketing advice on TG, Kols slowly disappearing from TL.
This is the most crucial phase as it brings about the greatest opportunities.
Phase Two is the stage of turning the tables, to achieve this goal, it is necessary to assess whether the project is already dead, or if the sacred J-Curve is loading.
Important indicators to focus on
– Team Wallet:
Are there bundled sales?
Are top wallets selling?
Have taxes (if any) been transferred to Cex or retained/used on-chain?
– Social Image:
Are Weibo/TG communications cautious and consistent?
Are social metrics growing or declining?
– Roadmap Execution:
Have the commitments mentioned in the first phase been fulfilled by the team?
– New Buyers:
Have prominent wallets made purchases?
Have new wallets made purchases?
Have dormant wallets made purchases?
There are many other indicators to consider, but I believe these are the most important indicators for assessing potential risks/rewards in the second phase purchase.
In the past few months, there have been numerous examples of the J-Curve, here are some examples I lazily collected;
Phase Three
The product shows initial success, with real income generated from practical use of the technology and massive followers and endorsements from KOLs in the meme world.
This is where you sell, as the risk is high, make sure to secure profits, with the focus on the second phase of the J-Curve.
In conclusion, studying the J-Curve can provide opportunities for those without any advantage (most of my purchases in Phase 2 were made through Uniswap with lower gas fees).
Hunting in Phase 2 can help us resist fomo and avoid becoming the buyers when snipers and whales sell off.
Hope you learn something new, goodbye.
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