In the world of cryptocurrencies, long-term investment success depends on thorough research and careful selection of assets. A crypto coins screener simplifies this process by helping investors filter coins based on various parameters like market cap, volume, and project fundamentals. Tools like TradingView and other screeners offer advanced charting capabilities and analytical features that are crucial for those seeking profitable long-term investments.
This article will walk you through how to use a crypto screener for long-term crypto investment, and provide insights into filtering coins based on their fundamentals and technical indicators.
Why Use a Crypto Coins Screener?
Crypto markets are highly volatile, with thousands of different coins and tokens. A screener filters these assets based on customizable parameters, enabling investors to pinpoint the most suitable coins for their long-term portfolios.
For long-term investors, the goal is to select cryptocurrencies with solid fundamentals that have the potential to grow over time. A good crypto coins screener allows you to evaluate metrics like:
- Market Capitalization
- Trading Volume
- Tokenomics
- Development Activity
- Community Engagement
Also Read: Best Filters in TradingView’s Crypto Screener in 2024
Step-by-Step Guide to Using a Crypto Screener
Here are the Step-by-Step Guide to Using a Crypto Screener:
1. Set Filters for Fundamental Analysis
The first step in using a crypto screener is setting filters to shortlist coins with robust fundamentals.
a) Market Capitalization
This is a key indicator of a cryptocurrency’s overall value. Larger market cap coins like Bitcoin and Ethereum are considered more stable, making them safer for long-term investments. Look for projects with substantial market capitalization, as this usually indicates higher stability and wider adoption.
b) Trading Volume
High trading volume signals liquidity, which is crucial for ease of buying and selling the asset. Low liquidity can trap your funds in a trade, while higher liquidity ensures that you can enter and exit the market with minimal slippage.
c) Tokenomics
Tokenomics refers to the structure and distribution of tokens in a project. Examine aspects such as supply limits, lockup periods, and token utility. These factors will help you understand the potential value growth of the token over time.
d) Development Activity
Frequent updates to the codebase or project milestones indicate active development. Tools like GitHub activity trackers can help you measure development activity. Consistent development is a positive indicator of the project’s long-term viability.
e) Community Engagement
A vibrant, supportive community adds value to the project. Check platforms like Discord, Twitter (now X), and Reddit for user activity and engagement. Projects with strong communities are more likely to grow and maintain their market presence over time.
2. Analyze Technical Indicators
Once you’ve filtered your crypto assets based on fundamental metrics, the next step is to apply technical analysis. Tools like TradingView offer comprehensive charting options to help identify potential entry and exit points for long-term investments.
a) Moving Averages
Moving averages, particularly the 50-day and 200-day moving averages, help identify trends. A coin trading above its moving average might signal a long-term bullish trend, while one trading below it may suggest a potential downturn.
b) Relative Strength Index (RSI)
The RSI measures the strength of price movements. An RSI value below 30 indicates that the asset is oversold, which could present a buying opportunity for long-term investors. Conversely, an RSI above 70 might suggest the asset is overbought.
c) Volume Analysis
Changes in trading volume provide insights into market sentiment. A sudden spike in volume could signal a breakout or breakdown, so keep an eye on volume trends while making investment decisions.
3. Conduct In-Depth Research
While crypto screeners provide a robust starting point, long-term investment decisions should be backed by detailed research beyond the screener.
a) Whitepaper Review
A project’s whitepaper outlines its goals, technology, and potential use cases. Reading and understanding the whitepaper is essential for assessing the project’s feasibility and future success.
b) Team Analysis
Investigate the team behind the project. Experienced, well-credentialed developers increase the likelihood of project success. Check their backgrounds, achievements, and previous ventures to gauge their reliability.
c) Competitor Analysis
Understanding the competitive landscape helps you identify the strengths and weaknesses of a project. Look for potential competitors and assess whether the project you are considering has a unique value proposition that can outlast its rivals.
4. Diversify Your Investments
As a long-term investor, diversifying your portfolio across different projects with varying use cases helps reduce risk. Even if one coin underperforms, others may compensate, ensuring a more balanced portfolio.
Also Read: Discover Promising Crypto Currencies With TradingView’s Screener
Important Considerations for Long-Term Crypto Investment
While selecting assets with solid fundamentals and technical indicators is crucial, there are a few overarching principles every investor must adhere to:
a) Risk Management
Only invest what you can afford to lose. Cryptocurrencies are inherently volatile, and even the most well-researched projects can fail.
b) Patience
Long-term investing requires time. Be prepared to hold your investments for months or even years to realize their full potential.
c) Stay Informed
The crypto space evolves rapidly. Keep up with market trends, news, and regulatory changes to ensure you are well-informed about your investments.
Best Crypto Coins Screeners for Long-Term Investment
Several crypto screeners can assist in your investment journey, with TradingView being one of the most prominent due to its in-depth charting tools and customizable filters.
Other notable crypto coins screeners include:
- CoinMarketCap: A widely-used tool that provides real-time data on market cap, volume, and price movements for thousands of coins.
- CoinGecko: Similar to CoinMarketCap, CoinGecko offers a detailed breakdown of key crypto metrics and community engagement statistics.
- AltFINS: This platform specializes in technical analysis and helps you identify promising investment opportunities.
Also Read: Screen Thematic ETFs With TradingView ETF Screener
Conclusion
Using a crypto coins screener is an essential tool for identifying long-term investment opportunities in the crypto market. By setting filters based on fundamental and technical indicators, and conducting thorough research, you can make more informed investment decisions. Always diversify your portfolio, manage risk effectively, and remain patient to maximize your chances of long-term success.
