Despite the fact that in the world of cryptocurrencies there is nothing for sure, if there are elements in the market that allow us to know if it is a good time or not to invest in it. Here we explain them to you.
To get rich there are no mathematical formulas, at most rob a bank and the bad thing about it is that wealth will not last long between you being caught and thrown in jail.
But the way to get rich there are many millions of people who have different sectors and different strategies. All well posed and valid, the point is that few adjust to reality. Hence, very few people get rich by investing (taking away those who are already rich).
Cryptocurrencies are a new path to economic supremacy, and a place to invest small amounts of money that can turn into fortunes. But for this you have to be attentive to many variables … or be lucky.
The indicators, which are something that we can quantify, can help us to know less about the currencies, their current moment, their historical situation and other very useful parameters to know if it is a good time to buy.
Let’s see them:
- Overly inflationary protocols: That staking is high and that profitability is above normal margins.
- Mayer’s Multiple: This measurement is used as an indicator to know if a token is in an upward or downward phase. You just have to see if its value is above 1, which is bullish, or below 1, which is a bearish phase.
- Focus on SOPR values: This indicator shows the degree of realized gains and losses for all cryptocurrencies that move on the chain. Buy when it is above 1.
- Non-existent innovation and development: Cryptocurrencies must be innovative tools, so if they do not have a continuous development they run the risk of suffering a gradual depreciation.
- The MVRV ratio: Experts say that a currency is considered overvalued when the MVRV indicator exceeds a value 3.7 times, and undervalued when it is below 1. So you have to buy anything below 1 because it will be about to explode.
It is true that there are several instructions, and that nothing is set in stone, but the experts assure that with these indications the less knowledgeable of the market can also operate with peace of mind in the world of cryptocurrencies.