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 ?
In order to attract investors, some exchanger give the facility to increasing the trade volume. Seeing that, many investors are tempted there. So not by looking at the trade volume, but by investigation at the order book, you have to understand whether it is fake or real. Most probably those are shit coins they try to do it to attract investors response by setting bot trading. 
Topic: Is Trading Volume an important metric ? - page 4. (Read 538 times)
For me, trading volume is like a way to measure how it is popular or how much money is flowing there, volume, it's more on trading activity, if it's active, lot of buyers/sellers.
So for me, you should also consider the market capitalization too, not only the trading volume.
So for me, you should also consider the market capitalization too, not only the trading volume.
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 ?
Depends, if it's only listed in single exchanges then there is a tendency that it was being manipulated by a single person or the team behind the project. That's why we are looking for liquidity here where multiple exchanges have the coins and the volumes are quite similar with their price being stable in a day. I experienced some coins where they only focus on one exchange and they dump it in one single move by selling everything they have. that's why things like that are hard to trust especially when involving a huge amount of money.
Trading volume is very important in trading. especially for a day trader. because of the high demand for buying and selling can facilitate or speed up the execution of a request for sale/purchase. In contrast to the low volume, it will be very difficult when we want to immediately execute a buy/sell request.
However, when talking about long-term investment, it will be more profitable if we enter a coin or asset whose trading volume is still low, which means that the market cap is usually still low. so the potential increase is still visible. especially if it is seen that the trading volume is increasing, it can be ascertained that there will be an increase that follows also the price (on a note that the asset or coin has good potential with clear fundamentals and utilities).
However, when talking about long-term investment, it will be more profitable if we enter a coin or asset whose trading volume is still low, which means that the market cap is usually still low. so the potential increase is still visible. especially if it is seen that the trading volume is increasing, it can be ascertained that there will be an increase that follows also the price (on a note that the asset or coin has good potential with clear fundamentals and utilities).
That needs to be analyzed even deeper. Trading volume is really important caused by this is reflecting the demand for the token. I meant the trading volume means total buy and sell orders in the market and so, will you invest in the new token with nearly zero trading volume?
The high the better as long as this trading volume was real. In the crypto you need good volume to liquidate your portfolios to minimize the impact caused by the slippage in the price.
Besid the selling of but as long as there would be enough order in the market and that's not something wrong. Buy and sell can be considered as the trading volume in the market.
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 ?
It is exactly important.Simply,' how can we invest in something that nobody wants to buy the coin or token?
If we are buying and investing in a certain coin, and we are expecting to get high profits from it, but there is very small trading volume, it means that there may be small hope for future profits mate. How can people trust a token or coin which only small or even nobody will buy them right now and moreover in the future?
As here like what said is true:
You should be compared to the order books.
Many new shit coins or tokens will have very high order sales, but very small order buy with a very high gap. This kind of investment will be very risky. 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 not a 100% verifiable metric. Because the trading volume of many coins and tokens is done with washtrade. This means that we cannot make a 100% accurate measurement. That's why investing and trading in major coins is always more secure. Also an important information; If a coin is experiencing a price drop while at low volume, it is a sign of bullish divergence.
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 ?
When I do trading and choosing coins, I'd use to check their trade volume as the higher the better. Seeing this means that the project is moving in the market and it means that the project has the potential demand. But if we saw selling demand, that is something it catches attention and probably there is a problem with that project, you'd better stay away from that.This is to say how important to check the market trend buy/sell volume as from that point, we can assess the project if we can make a profit or just lose.
trading volume is quite important honestly, if you're long term holders you should look into the trading volume of an altcoins that you want to invest because it gonna keeps the altcoin from delisted by the exchange if the trading volume isn't sufficient.
I'd also consider this as the thing that reflects overall fame and popularity of an altcoins since greater trading volume could means that the altcoin might have a great future ahead.
I'd also consider this as the thing that reflects overall fame and popularity of an altcoins since greater trading volume could means that the altcoin might have a great future ahead.
How important is trading volume when trying to decide whether to invest in a new project ? The higher the better ?
It's an indicator that the coin or token is less likely to be pumped and dumped so easily.How do you check the "order books" ? I'm only using CoinGecko here
Buy order and sell order on an exchange.Check the gaps in prices.
Pardon my ignorance but, what is a strong order book ? You mean the buy / sell orders listed ? That's not a metric you find on CoinGecko
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 very important to see how enthusiastically people are trading on the token, but that doesn't mean a high trading volume indicates the project is a good one for you to invest in. As @ryzaadit already said, if you see a high trading volume, you should compare it to the order book, if you see a strong order book, it means that people are very enthusiastic about trading the token.
Trade volume is often inflated, so do not focus on it much. Don't forget that trading volume, which is shown on trading platforms, is not always the transactions of real people, bots are also involved. Obviously, this can be one of the metrics when choosing a project or deciding to buy/sell it. If you are concerned about trading volume formed on large-scale selloffs, it is also worth paying attention to the order book and looking at the depth of the market. If there are only sellers in the market, and the demand from buyers is very minimal, then clearly this project at the moment is not of interest in terms of investment.
Trading volume is a fact when you are choosing an altcoin for trading. But it doesn't indicate you should be involved with the trade. If there is no trading volume that means no one buying or selling, it's a kind of dead token. If the trading volume is high due to selling pressure like what happened to Luna, then it's highly risky. If the candle is green and trading volume is high that means you might consider trading. But it doesn't mean you can make a profit, the price would dump at any time. It's crypto and always risky.
Trading volume is the amount and number of assets traded, whether crypto or fiat. Where a transaction happened, and the factors of it are
This won't correlate with how much a project could be worth because you can quickly inflate the trading volume by hiring the right people. I know there are some services you could do, and some algo trading bots would also be suitable for that.
That wouldn't be a definite signal for you. It might be hard to do if you were to follow that type of indicator.
- Quantity
- Price sold
This won't correlate with how much a project could be worth because you can quickly inflate the trading volume by hiring the right people. I know there are some services you could do, and some algo trading bots would also be suitable for that.
That wouldn't be a definite signal for you. It might be hard to do if you were to follow that type of indicator.
One of the most important things for traders is to keep track of the trading volume. It gives them an idea of how much activity is happening at any given time and in what direction. Trading volume comes with a couple of advantages and disadvantages, so it shouldn't be approached without understanding all the possible outcomes.onthe other hand, trading volume can be faked. To avoid being deceived by fake volumes, you need to understand the order book which is a list of low sell and buy prices
Whoa ! Several low cap Altcoins are now at zero trading volume !!
Even some of the good ones !
Okay so lets explore this.... if trading volume is at zero... does that mean that any purchase would make the price go up ? ( in theory ) So then would it be possible to push that price upwards by making a not so small purchase ? ( like $1000 or $2000 ) If this is true, then you could in theory manipulate that market in your favour, and get possibly a 2X or a 3X out of it, if trading volume is zero. I'm talking about very very small low caps though, which are already 0.00 something at least.
In case you think this is impossible... I saw it happen with one particular Altcoin in the top 1000. The price was so low a few days ago, I think it hit negative 99.8 per cent or something, that one large purchase made it go up 950% in one day !! Only in crypto !!
Even some of the good ones !
Okay so lets explore this.... if trading volume is at zero... does that mean that any purchase would make the price go up ? ( in theory ) So then would it be possible to push that price upwards by making a not so small purchase ? ( like $1000 or $2000 ) If this is true, then you could in theory manipulate that market in your favour, and get possibly a 2X or a 3X out of it, if trading volume is zero. I'm talking about very very small low caps though, which are already 0.00 something at least.
In case you think this is impossible... I saw it happen with one particular Altcoin in the top 1000. The price was so low a few days ago, I think it hit negative 99.8 per cent or something, that one large purchase made it go up 950% in one day !! Only in crypto !!
If talking of trading volume it the combination of sells and buys that counts on the trading volume and before investing your money on a project should from $1mio then you can invest. Therefore, looking at what amount is on lockup and how much is team holding as well.
One of the Altcoins I hold has a trading volume of $120 ! ( no typo ) And it's doing very well ! ( up 9% today )
It's not a meme coin but ranked seven thousand three hundred and something.
It's not a meme coin but ranked seven thousand three hundred and something.
I think trading volume can be an important metric to choose a new project for investment. But first you have to find out whether this trading volume is real or fake. Because many new projects create fake trading volume to attract investors. You can understand this by looking at the order book.
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