Diamond in the rough

There are a few reasons why I choose a coin when I am trying to find one that is undervalued. I think of it as finding a diamond in a huge pile of rocks, because essentially that is what your doing. It is a little difficult to do if you have not been in the cryptocurrency community for that long, so please take my word to ear and follow these basic things to do when finding the undervalued coin and also why you want to find that undervalued coin in the first place.

How to find undervalued coins

If you are trying to make any big gains as far as maximizing your investment in the short term you have to find coins/tokens that are NOT YET on the majour exchanges. Most of the time when in the past a coin has hit a majour exchange for the first time you see incredible gains in price. So next time you are looking at a chart or on coinmarketcap and notice that something is growing too quickly, this might be why. A majour exchange, are the exchanges that you probably have heard of such as poloniex , bittrex , binance , kraken , bitfinex , coinbase, and maybe even kucoin depending on what you want to go by when considering something majour. When you think about it if your trying to start out day trading or even just want to buy your favourite coin and hold it, you go to a majour exchange to do so, if your new you probably go to the exchange that has been recommended to you or that has at least the one you are aware of. Visit a previous post I made about the exchange that I recommend: https://steemit.com/cryptocurrency/@jokeskay/binance-phone-app-and-exchange-review-why-i-am-on-binance . These are the exchanges where the coins with HUGE demand are listed, think about it. If a majour exchange like binance were to just accept any coin that applied to be listed on their website, even though they would probably bring more peoples attention in the end they are only looking to partner with the coins that are in demand, this is the most important thing because as an investor you want to think the exact same way. Demand equals purpose and that is what majour exchanges are after, therefore you have to be in tune with what coins people are talking about , and the current price it is at and if it is listed on a majour exchange. If the answer is that it is in demand and not listed on a majour exchange then you have found an undervalued coin.

Why do you want to find undervalued coins

Going back to the point about maximizing your profits for the short term. You have both long term and short term goals when buying cryptocurrencies. Usually you have either done your research behind a project or not, research can be anything that involves you at least gaining an understanding for the overall project and understanding practical use.
Visit another post I made about practical use cases in cryptocurrency: https://steemit.com/i/@jokeskay/cryptocurrency-practical-use-case . The truth is people follow hype, it is just the way that things are, no matter how much there are people who want to educate themselves as much as possible, the masses will always follow what is in front of them. So then why do you want to be the one that doesn't? Again back to my point, to maximize your profits in either the short term or long term, really it is up to you. If you have done your research on a project and you know that it is extremely undervalued then you are not going to sell it even if it dips below what you bought it for. That is the purpose for doing your own research, you are smarter than the people who followed the masses blindly and probably sold the first chance they got. You are even more likely to buy more when everyone else is selling their shares, though just because you have done your research doesn't guarantee anything, nobody can be certain when it comes to investing, especially in a market as brand new as cryptocurrency. Now that is an example of buying for the benefits of long term profits. Short term profits are likely going to be the exact opposite, so instead of being on the buying side when things fall, you are going to be on the selling side, and hopefully before evrything completely went to the floor for good, or so you thought. In any event it helps to know what type of coin or token you are holding whether it be one that you bought because it is incredibly high in market value or because you did your own research and found it to be a practical idea for what it is and think that it is undervalued. The more you know, the better chance you have for success.

Thank you for reading my post. If you enjoyed please give me an upvote, and share.

Follow me @jokeskay for more interesting posts and topics like this.