Coinrule & Daneel Are Getting Sentimental! 😉

Trading cryptocurrencies is in some ways radically different than trading stocks, bonds, or other “traditional” assets. In particular, it is tough to evaluate the intrinsic value of any coin or token on the market. But while it is hard to analyze the fundamentals of a Blockchain, nowadays there are so many sources of information that it is possible to quantify the mood of the market on a specific coin.

FOMO (Fear of Missing Out), FUD (Fear, Uncertainty, and Doubt), Panic Selling and Greedy Buying are typical psychological patterns that have a significant impact on Cryptocurrencies prices every day. Being able to manage these phenomena in an automated way, as made possible by Coinrule, constitutes a unique advantage for any trading strategy.

We are therefore delighted to announce that we have partnered up with Daneel to provide market news and sentiment data analysis directly to Coinrule users.

What is sentiment analysis?

Sentiment indicators track how bearish or bullish the market is regarding one or more coins. For decades now, in traditional financial markets, polls and surveys among consumers and manufacturers were considered the best leading indicator of the mood of investors. For example, two of the most closely watched monthly data releases are the PMI (Purchasing Managers’ Index), and the Consumer Confidence Survey.

At a time where all the essential and price-sensitive news flows across social networks 24/7, using real-time analysis of these sentiments guarantees an instant snapshot of the mood of the market and that can be a valuable tool for any trader to take more precise decisions.

The cryptocurrency market is very “mood-driven”, and most of the participants before placing their orders, spend time reading sources like Twitter, Reddit, or Bitcointalk. Being able to catch what people are talking about provides a significant edge to improve the effectiveness of every trade.

The new trading tool for Coinrule users

Coinrule is forming a partnership with Daneel, a leading provider of Sentiment Analysis indicators, to offer our users the possibility to develop advanced automated trading strategies based on the sentiment of the market. For the first time, retail traders and investors will have access to leading-edge AI technology that can analyze a millions of data points from across social media, press releases and forums every second, and evaluate what market participants are saying about cryptocurrencies.

Daneel’s core AI algorithm is using IBM Watson, one of the most efficient in the market. It allows recognizing the sentiments of the market to provide alerts about sentiment changes in real time. Such a sentiment-based tool represents an unparalleled advantage for any trader or investor to improve his portfolio management abilities.

Moreover, Daneel, tackles one of the most critical risks of analyzing large amounts of data. Nowadays, fake news is a real problem as its content lowers the quality of the sentiment analysis and can lead to wrong investment decisions. Daneel uses its advanced AI tools to analyze how reliable a source is based on different parameters such as diffusion, objectivity, and cross-checking with other sources.

Coinrule users, in this way, will be able to trade based on the most reliable and precise news available at any time.

How to interpret sentiment indicators?

Just like a price chart provides a visual interpretation of how supply and demand for a specific asset evolved in a certain period, a Sentiment Indicator provides measurable data about the general opinion that market participants have about that asset.

Manipulating events, like “whale” trades, market overreactions, or other abnormal dynamics, can limit the role of the price chart to represent in a precise way the mood of the market. On the other hand, it’s more complicated to manipulate the entire market sentiment, and therefore the signals that it provides can be more reliable and stable.

Using the Sentiment Analysis tools provided by Daneel, it will be simple to recognize when the market mood is positive or negative and to use that info to adjust your automated trading strategy.

There will be a maximum level of flexibility for the rules. Example:

“BUY Bitcoin if the price is below 7000 USD, AND the Sentiment Score is POSITIVE.”

or

“SELL Bitcoin if the price increase is 5%, BUT the Sentiment Score is negative.”

The Sentiment Score can be used to validate a market view or a study based on technical analysis indicators, or it can be used as a contrarian indicator. Usually, just like the market price, also the market sentiment moves in cycles. Periods of excitement are followed by disillusion and then fear and despair with a direct impact on the price. Catching the times of extreme market sentiment is a smart way to anticipate market rallies and prevent price drops.

Two companies, Shared Vision

On our roadmap in the coming months, we plan to add more partnerships with leading companies in the Crypto Business. We are looking for partners who are aligned with our core values. Our users deserve the best possible, intuitive tools to develop effective automated trading strategies.

Daneel’s goal is to “democratize access to artificial intelligence for investors” and in the same way, Coinrule wants to make access to Automated Trading Strategies available to beginners and advanced traders alike. Blockchain and Cryptocurrencies are changing the world day by day, and in the same way, we want to start a revolution in the Trading Industry, reducing the gap between professional and non-professional traders and investors.

We are working on integrating Daneel’s APIs to integrate their Sentiment Score into our Rule Page. We will provide more info about the timing in the coming weeks.

In the meanwhile, you can download Daneel on Android or IPhone.

What is Coinrule

Coinrule allows you to create trading rules that run automatically across your favorite exchanges.

With Coinrule you can quickly develop your own trading rules and strategies and set them up to run automatically. It is the if-this-then-that for Cryptocurrency trading that allows you to plan your crypto trading rather than having to sit for hours in front of charts. Best of all? No coding skills are required, meaning anyone can use Coinrule.

Sign up for a free trial: www.coinrule.io
Follow us on:
Twitter: @CoinRuleHQ
Instagram: @CoinruleHQ

Please note that none of the above is investment advice. Trading and holding cryptocurrencies remain a high-risk investment that is only advisable to users who are willing to spend time doing their research.