Step by Step: Finding Microcap Gems
Best time to research gems is during a weak market (now) so that you are prepared for the strong market (future).
Hunting for the next 100x in the market? Best time to research gems is during a weak market (now) so that you are prepared for the strong market (future). In this article let’s look at how to find micro-cap gems for quick day/swing trades.
Dex Screener
First, use a tool: @dexscreener
If you scroll to the bottom of the homescreen, you’ll see this purple filter box. This is where all the magic happens.
Click on “Rank and Filter” and set your parameters. First, choose the chains you want to trade with (or leave it on All DEXes ). Then choose minimum liquidity. Because I am willing to trade nano-caps, I go pretty low here. But you may choose to up it to 50k or even 250k…
…Minimum liquidity is a personal preference. Note that extremely low liquidity will only work if you aren’t trading with a large volume. If your trades are only a couple hundred dollars, then these tiny pools will work.
Next is the pair’s age. I choose 720 hours…which is one month. The reason is because 90% of honeypots/rugpulls do so within the first hour or two. Another large handful of rugs within a week. Only screening coins that are at least a month old reduces the scams to <1%
After that I’m looking at a 24hr change. It should be at least 2%. We are looking for coins that are pumping. If the price has increased 2% or more in the last 24hrs then momentum is likely on the upside.
Finally the 5min change. 0.5% minimum and 3,000 volume. That captures the tokens that are seeing upside momentum RIGHT NOW. Then the fun begins…
When coins appear on your screen click on it. The default time frame is 15min. First click to Daily. IDEALLY there will be an obvious trend upward (these are the easiest to scalp profits). Lately, however, those don’t happen so often. So I look for at LEAST 2 days of green.
Token Sniffer
Next, copy the contract address and go to @Token_Sniffer and do a smell test. This is to see if it’s a honeypot or has malicious code. This one scores a 55 (not bad…never trust 100%…those are almost always scams)
Nowadays protocols don’t renounce ownership often anymore, so I’m ok with this. I also like to scroll down to see similar contracts. The fact that this contract is similar to known scams is a red flag…but I won’t count it out yet. Now time to look at the block explorer.
Spot honeypots
I’m only looking for short-term profit, so I’m really just concerned if it’s a honeypot. As long as I can sell, I’m cool. To check this for sure (cuz sometimes they can get around TokenSniffer) I look at transactions.
I choose three random SELL txns of a significant amount (preferably over $200). First, I make sure the wallet addresses aren’t all the same. If only one wallet is ever making sales, that’s a bad sign.
I then click into each wallet and scroll through their txns looking for “Transfers”. I’m looking for private wallet addresses where money has been transferred to or from. If there aren’t duplicate addresses in any of the three wallets, I’m good.
THEN it’s good to trade. At this point you can deploy whatever your favorite scalping strategy is.
MoonarchApp
Now let’s look at @MoonarchApp. I simply go to the home screen of my favorite chain (#Fantom…duh). Then I look at Top gainers. I filter by 5 min gains. I’m looking for tokens that have 5min, 10min, and 30min in the green
When I find one, I click on the Dexscreener link and check the numbers. Does it have adequate liquidity? (sometimes these are brand new tokens with like $50 in the LP). How old is it? Etc.
If a token passes these checks, I’ll put it through TokenSniffer and go through the rest of the process to make sure it’s safe. Easy peasy.
Trading View
NOW one last one…let’s look at TradingView. Here we’ll use their Crypto Screener tool. There are definitely a LOT more robust screening options in this tool…
Here are some of my favorite screener parameters.
- mcap from $100k — $300m = low to mid cap
- Relative volume at time = the amount of increased volume within the chosen timeframe (I choose 15min)…2 means 2x volume in the last 15min.
- 5min change…as usual, above or equal to 0.5% and the Negative Directional Indicator crosses below the Positive Directional Indicator. This means the momentum is on an upswing.
There are TONS of other parameters you can use (even candlestick patterns), so you’ll want to play around with this. Anyway, this is how I often find obscure alts that are making intraday moves. I hope this was helpful.
Acknowledgment
Content converted from the thread by DefiRobot on Twitter. Follow him for more quality content, including alpha, research and trend.
