Top 10 Must-Have Crypto Indicators for Immediate Implementation!

Maximize Your Crypto Gains: The Top 10 Onchain Indicators You Need to Know

Do you want to maximize your crypto gains? If so, then you need to be familiar with onchain indicators. In this article, we will outline the top 10 indicators that will give you an advantage in your crypto trading toolbox. These indicators are derived directly from the data recorded on a blockchain, providing valuable insights into the health and activity of cryptocurrencies. By understanding these indicators, you can make educated guesses about future price movements and potentially achieve significant gains. So, let’s dive in and explore these indicators in detail.

1. Daily Active Addresses

Daily active addresses are unique wallet addresses that have been active participants on the network within a 24-hour period, either sending or receiving funds. Tracking the activity of these addresses across different cryptocurrencies can reveal a lot about the popularity and performance of a network. An increase in the number of daily active addresses often correlates with a rise in the asset’s price, indicating higher demand for the network’s services and currency. Conversely, a decline in active addresses may signal waning interest and a potential drop in value. Monitoring this metric can provide valuable insights into the health of a cryptocurrency network.

2. Daily Transactions and Fees

Daily transactions represent the volume of activity within a blockchain over a single day, while transaction fees are payments made by users to compensate miners for validating and recording transactions. These indicators provide insights into the market’s mechanics. A surge in transactions and fees indicates increased demand for blockchain services, which can fuel a rise in a cryptocurrency’s value. Conversely, a decrease in these numbers may suggest a dip in interest and price. It’s important to note that not every transaction is accompanied by a fee, and costs can vary based on network congestion. Monitoring these indicators can help you gauge a crypto’s present state and its immediate demand.

3. Exchange Supply Indicator

The exchange supply indicator tells us how much of a cryptocurrency is currently stored in exchange wallets. This information is crucial for understanding market dynamics. If there is a significant amount of a particular coin or token on exchanges, it could indicate that people are about to sell, potentially lowering the price. On the other hand, if there is a scarcity of a particular asset on exchanges, it suggests that people are holding onto their assets, which can be indicative of a future upward price movement. Monitoring exchange supply can provide valuable insights into market trends and liquidity.

4. Market Value to Realized Value (MVRV)

The market value to realized value (MVRV) indicator compares the current market price of a cryptocurrency to its realized value, which is the historical price tag of all coins in circulation. This ratio helps determine if a cryptocurrency is potentially overhyped or undervalued. An MVRV above one indicates that the market may be getting too excited and the coin is potentially overvalued. Conversely, an MVRV below one suggests that the coin is undervalued. Monitoring MVRV can help you make informed decisions about the market’s sentiment and potential price movements.

5. Market Tops and Bottoms Indicators

Market tops and bottoms indicators are a group of metrics that can help identify market tops and bottoms in the crypto market. These indicators include net unrealized profit to loss (NUPL), percent of addresses in profit, and relative unrealized profit to loss. NUPL shows the difference between the current worth of everyone’s crypto versus what they paid for it. A high NUPL may indicate a market top, while a low NUPL suggests a market bottom. The percent of addresses in profit measures the percentage of people making gains with their crypto at current prices. Monitoring these indicators can help you anticipate market shifts and make strategic trading decisions.

6. Investor Sentiment

Investor sentiment refers to the feelings and moods of market participants. It is a qualitative indicator that can provide insights into the market’s next move. Monitoring investor sentiment can help you gauge whether people are feeling bullish or bearish, which can influence price movements. By understanding the market’s sentiment, you can make more informed trading decisions.

7. Miners Revenue

Miners revenue is the income miners receive for keeping the network secure and processing transactions. Monitoring miners revenue can provide insights into the health and activity of a blockchain network. When miners are making significant revenue, it indicates a buzzing network with high activity, which can potentially lead to price increases. Conversely, low activity may suggest the opposite. Understanding miners revenue can help you gauge the network’s health and potential price movements.

8. Hash Rate

The hash rate is a measure of the amount of computational power being expended to secure a blockchain network and process transactions. A high hash rate indicates a strong and secure network, making it difficult for hackers to break in or manipulate transactions. Monitoring the hash rate can provide insights into the network’s safety and potential price movements. Additionally, as mining becomes more challenging with a higher hash rate, it can indicate increased capital investment in securing the network.

9. Hodl Waves

Hodl waves are a useful way to gauge the sentiment of long-term investors. They track the movement of coins based on their age, categorizing them as lost or ancient coins (over 5 years old), old coins (between 1 and 5 years old), and young coins (less than 6 months old). An uptick in old coins re-entering the market suggests that long-term investors are selling, potentially driving prices downwards. Monitoring hodl waves can provide insights into market sentiment and potential price swings.

10. Smart Money Labels

Smart money labels track the investment patterns and market foresight of influential market players. These labels identify investor wallets or addresses that consistently make smart investments or provide liquidity on popular platforms. By following the smart money, you can gain insights into the strategies of experienced traders and potentially make profitable trading decisions.

Frequently Asked Questions (FAQs)

1. How can I access onchain indicators?

Onchain indicators can be accessed through various analytics platforms and blockchain explorers. Some popular platforms include Nansen, Glassnode, and Coin Metrics. These platforms provide valuable insights and data on onchain indicators, allowing you to make informed trading decisions.

2. Are these indicators foolproof for predicting price movements?

While these indicators provide valuable insights into market trends and potential price movements, they are not foolproof. It’s important to remember that the crypto market is highly volatile and influenced by various factors. It’s always recommended to do your own research and use multiple indicators in conjunction to make informed trading decisions.

3. Can these indicators be applied to all cryptocurrencies?

These indicators can be applied to most cryptocurrencies that have onchain data available. However, it’s important to consider the specific characteristics and dynamics of each cryptocurrency when interpreting these indicators. Some indicators may be more relevant for certain cryptocurrencies than others.

4. How often should I monitor these indicators?

The frequency of monitoring these indicators depends on your trading strategy and the level of involvement in the market. Some traders may prefer to monitor these indicators on a daily basis, while others may do so on a weekly or monthly basis. It’s important to find a balance that suits your trading style and goals.

5. Are there any other indicators you would recommend?

While the indicators mentioned in this article are valuable, there are many other indicators and tools available for analyzing the crypto market. It’s always recommended to explore different indicators and find the ones that align with your trading strategy and goals. Some additional indicators you may consider include RSI, MACD, and Bollinger Bands.

In conclusion, onchain indicators provide valuable insights into the health and activity of cryptocurrencies. By understanding and monitoring these indicators, you can make informed trading decisions and potentially maximize your crypto gains. Remember to do your own research, use multiple indicators in conjunction, and stay updated with the latest market trends to make the most out of your crypto trading journey.