Increasing my Syscoin position
I have decided to increase my position with Syscoin. I already hold a substantial position with this coin compared to other non-top 20 market cap coins.
I initially took out a position of around 1.2BTC around three weeks ago as I thought it was undervalued £0.02 and a market cap of under $20m, it has already risen 116% since then and now the price has stabilised I have decided to increase my position by another 0.5btc.
NOTE: Sorry, I usually price coins in £ but the market cap in $. The reason is if I own a coin or am interesting in it I can understand price movements better when I know what I am making. I don't have the time to keep converting the market cap to £ and just use the $ measure as a marker.
If you look at the chart, you can see how I use the charts to read market movements to help make decisions. You will see with the pink line how the price has risen against a steady resistance line until it peaked around 1st May. With the yellow line, you can see how the price began to fall again against another resistance line but broke through this yesterday, which is, therefore, my entry point for the increase in position.
You can't just read charts on their own; it is always sensible to follow charts alongside news, rumour and roadmaps, though always take opinion with a huge pinch of salt. What I mean by this, is that you can go to Reddit or a Telegram group and watch idiots claiming it is about to explode or implode, this is usually based on what they want to happen or because they have missed out, etc... Following these opinions may occasionally work but it really is just gambling.
The way to research is as follows:
- Go to the website for Syscoin, http://syscoin.org/, look around, get a feel for the brand, the experience of the team, the white paper and what they want to achieve. I like the fundamental concept of Syscoin which is helping companies grow their business on the blockchain. Also when looking at the team, are they credible? What is their history? Look at the roadmap, what is happening? You can quickly get a feel for whether this is a serious project or not.
- Search Google news, you will see from a few days ago "Syscoin Becomes First Cryptocurrency To Debut Mainnet Lightning Network". If the coin is attracting credible news, then the project is credible. Also the nature of the news, with the above story they are clearly trying to outpace other coins.
- Check out the subreddit, are there serious technical discussions or is it just full of price speculation nonsense? Though a warning on this, some of the leading coins will have this, naturally with huge moves by the likes of Ether, Bitcoin, Dash, etc... you will get muppets only talking price. With smaller coins then this would be a concern as it is a potential pump and dump.
- Look at the total coin supply; you can see this on Coincap.io. Any price needs comparing alongside coin supply. Bitcoin has an available supply of 16m. Syscoin has an available supply of 524m. Much higher, this will impact my price targets. A price target in the short term of something like £10 is unrealistic as this would put the market cap at £5bn. I can though use other coins for comparison. As an example, Maidsafecoin has an available supply similar and a price of £0.20. I believe that Syscoin can achieve a similar price to Maid within a year.
- Finally look for partnerships. Syscoin is a Microsoft Azure partner, which adds credibility to the project.
As such, I still think Syscoin is undervalued at its current price of £0.04, and I have a 2017 target price of £0.15. I can't see me increasing my position any further beyond this in the short term.
Remember only invest what you are willing to lose and do not make risky emotional decisions.