Is Trading Volume an important metric ? - page 2.

Jackl87

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

I don't think that trading volume is the most important factor. The most important ones for a new project for me are the team, the roadmap, the use-case of the project and also the tokenomics. The trading volume is also not that unimportant though. When you are exclusively talking about very new projects like projects that have just launched on that day, then i think most of those projects will have a decent volume if they were able to create a minimum of awareness and interest for their token.
Projects that are on the market for a little longer but still very small can be different though. There are a lot of projects out there that have trading volumes of a few hundred dollars a day. This is a very bad sign in my opinion and i would not invest in such projects because they are almost dead and a id size sell or buy order would probably mess up the price.

ije07

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We can see the trading volume in the market in the order book status that occurs in the market and the order depth is not too large, the token project has a good trading volume and you can also see the trading volume within 1 week or 1 month so that's how you can see how much large trading volume on the project so you are even more confident when you want to enter a new project.

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

Trading volume is the result of buying and selling in an exchange, of course if all of them sell will make the volume increase. But we look not only based on trading volume, but also the level of price stability in an exchange.

Pelana vreo

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When you trade on the exchange, some orders seem to move quickly, this is due to the volume of trading using bots, I believe investors choose coins with large trading volumes, it is chosen to do scalping, some investors who are already familiar with crypto will saw the trading volume and they placed several large orders.

TastyChillySauce00

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This is the most important metric although sometime this can be manipulated easily when it comes from the whales and centralized exchange site. The main concern is when people are looking for the good token or coin and they will always be seeing the trading volume as the most important thing.
Token will have very high volatility caused by low liquidity even some may be trapped caused by the liquidity was not enough for him to sell his token to the exchange site.
This is the main thing that must be used by anyone before try to invest in the crypto

ringgo96

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In investing in trading volume, it is always relied on in assessing a project, and it is indeed proven that the trading volume of a project is large, so the project is indeed targeted by many investors and can achieve the targets that have been set, but we must know that some fraudulent projects use fake trading volumes to bind investors, so we must always check in detail so as not to enter the fraudulent project.

Wildwest

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Usually the trading volume is a sign that the projects we participate in can develop if the volume is large, and this we have often found in potential coins that are always increasing all the time in volume, but there are also some projects that do create fake scenarios so that investors are interested in participating in the project but at the end it is just a joke that makes big losses, then in addition to the matrix we must also look at the performance of the team that manages a project.

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Quote from: Cryptoababe on June 18, 2022, 05:34:58 PM

Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

Trading volume doesn't really mean a project is good to invest on because there are a lot a fake volumes out there on pump and dump projects.
So.. As a project get stronger or have more use case or get popular, the volume will increase.

Yes, you are right but it was a big contribution when choosing a coin to trade. Well, of course, you have to check the background of the project if the said volume was faked or something real. Perhaps, this is not just the only basis we check, and to see their consistency could prove their legitimacy like the top listed coins. Choosing known projects together with reliable and trusted exchanges helps us to recognize if these projects are worth trading or not.

Cryptoababe

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

Trading volume doesn't really mean a project is good to invest on because there are a lot a fake volumes out there on pump and dump projects.
So.. As a project get stronger or have more use case or get popular, the volume will increase.

lalabotax

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ?

Yes, a higher trading volume means that more people are holding and trading the coins. It means that the chance to rise up may be much better. More importantly, this coin may have long survived in the market.

Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

No offense, when this happens, all coins will also experience the same, crash price. if more people are selling panic, the price can crash more easily. But this doesn't relate too much to the trading volume.
On the other hand, if it only has very small or no trading volume, it means no hope for the future of this coin, will be dead soon project probably

dlightag

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As a new project that just listed less than a weak with much trading value, I mean liquidity, it means really have to make a research about the if it's real or bot is trading to make the trading a high impact in trading volume (liquidaty) and also check the trading history and pending order on exchange for better understanding.

WeedGoW

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Quote from: Psynthax on June 18, 2022, 11:17:38 AM

Honestly trading volume hardly could affect the price movement in most of the altcoins but enough sign that this altcoins is famous for the majority of holders.
Trading volume as far as I know, could keeps your altcoins from getting delisted and could support your altcoins or your favourite altcoins to be listed in various exchanges since the trading volume is quite high.

It does affect if a coin with a low trading volume jumps up in price like 10x or something, it was super risky for any new investors looking to buy the coin since they could fall for a pump run. Delist doesn't matter since if your coin got delisted, it would be a bad press for that coin. More chance for dev of that coin creating some fake trading volume to keep their coin list on that exchange.

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ?

I think the buy order is more important than just the trading volume. Buy order shows how much is the demand for that project. Volume can be cheated through wash trading but buy orders can't be cheated.

Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

That is why it is better to check the buy order if the demand support for the project is strong.

wheelz1200

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

If there is NO volume it shows no interest in the project. You could have a coin with a high price but no movement in volume you can probably expect a drop in price. I think volume is a key factor when looking for trade opportunities.

Psynthax

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Honestly trading volume hardly could affect the price movement in most of the altcoins but enough sign that this altcoins is famous for the majority of holders.
Trading volume as far as I know, could keeps your altcoins from getting delisted and could support your altcoins or your favourite altcoins to be listed in various exchanges since the trading volume is quite high.

Silberman

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Quote from: jrrsparkles on June 15, 2022, 10:28:43 AM

Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

Trading volume can't be a deciding factor because its is easy for an exchange to increase the volume of particular coin or token by faking the trade orders and also there is a term for this which is wash trading, before investing in a project you need to start with the fundamental analysis then start looking the trading volume and all.

It is true that exchanges can try to fake the volume of certain coins, however just because this happens it is not really an excuse to completely disregard the trading volume as an important metric, in fact it is incredibly important, as if you see that a movement is starting out but there is not an increase in the volume behind it, then you know that it has very little chances of succeeding and it will eventually fail and the price will go back close to its starting point.

Dave1

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Quote from: asriloni on June 15, 2022, 10:36:39 AM

It certainly is important although market capitalization and the roadmaps added with the overall progression of the project is a lot more important.
You definitely could judge how liquid the market of an altcoin is by simply looking at the trading volume but if it's already beyond 1 mill I guess it's better if you take a look into the overall market capitalization and the development of an altcoins instead, since that's gonna be the ones that decide if a project gonna hits its highest ATH or just gonna go down instead.

Yes, but it's not the only metrics that we need to look up. There are a lot that can really influence or at least a indicator where the price will be going.

Top 10 altcoins are liquid already, but the question is the rest because some of them are being used for pump and dump, artificially increasing the trading volume. While others, there are no movement at all.

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Quote from: asriloni on June 15, 2022, 10:36:39 AM

It certainly is important although market capitalization and the roadmaps added with the overall progression of the project is a lot more important.
You definitely could judge how liquid the market of an altcoin is by simply looking at the trading volume but if it's already beyond 1 mill I guess it's better if you take a look into the overall market capitalization and the development of an altcoins instead, since that's gonna be the ones that decide if a project gonna hits its highest ATH or just gonna go down instead.

It's true what you said, that volume is important enough to run a certain coin, altcoin liquidity can be seen by trading volume, but market capitalization is something that is also very much needed, and in my opinion both are quite needed to see the development of a coin, without all that, then coins are difficult to achieve new ATH, because both are needed for the development of an existing coin

asriloni

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It certainly is important although market capitalization and the roadmaps added with the overall progression of the project is a lot more important.
You definitely could judge how liquid the market of an altcoin is by simply looking at the trading volume but if it's already beyond 1 mill I guess it's better if you take a look into the overall market capitalization and the development of an altcoins instead, since that's gonna be the ones that decide if a project gonna hits its highest ATH or just gonna go down instead.

jrrsparkles

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Quote from: Len Saldua on June 14, 2022, 08:02:37 AM

How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ? But if people are "selling off" like crazy wouldn't that also mean a high trading volume ?

Trading volume can't be a deciding factor because its is easy for an exchange to increase the volume of particular coin or token by faking the trade orders and also there is a term for this which is wash trading, before investing in a project you need to start with the fundamental analysis then start looking the trading volume and all.

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