Whether a project is of high quality is similar to whether a company is high quality and has potential. When researching a company, we look at its price-to-earnings ratio, annual reports, whether the founders and management team are excellent, and whether they have a certain level of idealism and responsibility. We also consider whether the investors behind it are reliable and whether their assets are substantial. The same principle applies to researching a cryptocurrency, which can be considered from the following aspects:
1: Is the overall direction a bull market? No matter how good a project is, if it was born in a bear market, it is difficult to take off. First, this overall direction should be well grasped.
2: Research the project team. Is the project team reliable? Are they dedicated to creating quality projects and providing excellent products and services for users, rather than just looking to profit at the expense of the market? They should have a sense of responsibility and ideals.
3: Research the background of investors: For example, currently reliable investment teams in the market include Grayscale, Binance, CB, A16Z, etc. These companies choose quality projects after strict screening and research. Projects that can attract investment from these firms are considered valuable rather than some worthless coins. They can survive even in a bear market, unlike other worthless projects that go to zero in a bear market.
4: Research the value of good projects: technology, application scenarios, whether they can be implemented, and whether they can provide users with a quality experience. Recent Layer 2-related projects are aimed at addressing current user pain points, such as slow Ethereum transactions and high gas fees, which are urgent issues that need to be resolved.
The above aspects can help determine whether a project has long-term investment value. The following points can help determine whether a project has short-term investment value:
1: Are there favorable short-term projects? Such as those on the Shanghai Stock Exchange, Binance, CB, etc. Are there version updates, halving benefits, etc.? These are all considered positive news. Generally, good news is released two or three days in advance.
2: Market trends, is the trend an upward trajectory, has it formed related patterns, etc.? Is the market in a period of main force driving the price up or in a period of accumulation? Generally, accumulation periods are characterized by declines, forcing retail investors to sell at a loss to absorb lower shares and raise profits, which is a common tactic of the main force.
3: Is the main force entering the market? When the main force enters, it usually aims to drive the price up. Whether large funds are entering can be judged by the volume of large transactions.
In this round of rebound, we have positioned LINK, UNI, AAVE, and CRV, which are all market focal points. However, as retail investors, we should be the first to seize the opportunity!
So next, I have prepared a spot investment, starting with 50%, and it's a short-term quick in-and-out strategy. It's not convenient to disclose here to avoid heavy losses. Those interested can leave a comment to show their interest!