Crypto Analyst Reveals The Secret Formula Behind Making Serious Profit Off Meme Coins Like PEPE

In just over 21 days, meme cryptocurrency PEPE PEPE/USD has surged by more than 375,000 times, leading a number of early investors to cash out.

While investing in meme coins is inherently dangerous, there are several methods you can use to help improve your chances of making money in an unpredictable market, according to crypto analyst Miles Deutscher. 

In a Twitter thread on Friday, Deutscher, who notes in his bio that “tweets aren’t financial advice,” wrote that the performance of meme coins tend to rely heavily on psychological drivers than fundamental ones. In what is known as the “Castle-in-the-Air Theory,” investors attempt to predict price increases in the future rather than determining intrinsic worth, he explained. 

While Deutscher acknowledged that investing in meme coins is essentially a gamble, he shared five strategies that can help increase your chances of making a profit off meme coins:

– Use tools like DEXTools to uncover top-performing meme currencies that are gaining traction. Keep track of which coins are performing and only invest “in memes that are gaining momentum,” the analyst tweeted.

– Check to see if the token has a “strong culture,” Deutscher wrote. A successful meme coin is usually built on a solid community. Monitor a token’s performance on social media via websites like LunarCrush and determine whether the token is trending.

– Look into the basics, Deutscher added. Examine the tokenomics, the developer team, and any potential dilution or burning processes behind the token. If you’re looking to avoid “constant rugs and exploits,” use Token Sniffer to conduct an audit and Bubblemaps to evaluate the distribution of wallets. 

Also Read: Bitcoin On Fire: Get Ready For A 20% Rally – Matrixport Predicts ‘Limited Resistance’

– Choose between playing the rotating game or following the leader, the analyst wrote. While playing the rotation game in involves investing in smaller-cap tokens that “emerge underneath a niche leader,” “new liquidity gravitates toward the leader first,” thereby making “the leader a better R/R play,” he tweeted. 

– Follow the “smart money,” Deutscher wrote. You can utilize resources like Etherscan and LookOnChain to keep tabs on profitable meme coin traders and their investments.

When it comes to trading meme coins and making a profit, Deutscher wrote that there are several steps to keep in mind. 

Treat The Meme Coin Market Like A Casino: If you don’t feel comfortable betting a certain amount on a meme coin as you would at a casino, you probably shouldn’t do it, Deutscher advised.

Don’t Mix Your Meme Coin Capital With Your Investing Capital: Any money that is put toward a meme coin should be kept separate from the funds you allocate to other assets, the analyst wrote. “This will help you clearly [separate] your strategies and reduce [your] emotional toll,” he added.

Use Technical Analysis For Entry: Use dollar-cost averaging or wait for large corrections before investing in the following high -period breakout, the analyst suggested.

Book Profits Strategically: Withdraw your initial investment after a 2x gain and ladder out a predefined percentage with each subsequent gain, Deutscher tweeted.

You should also watch for indicators, such as trading volume exceeding market value, lower highs on high timeframes, a decline in holders or slowed growth, sales from huge whales, and a change in funding rates from negative to positive, to determine when a peak is occurring and de-risk, the analyst wrote. 

Read: Israeli Authorities Uncover Binance Accounts Tied To ISIS, Hamas Group

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