Finding Alpha with AlphaScan

There are many ways to find alpha. In this post, we will show you one way of finding tokens that are just starting to gain significant positive sentiment on Twitter but haven’t yet reached their full potential in just a few minutes using AlphaScan.

The Premise of AlphaScan

As a base premise, we want to find tokens that are getting attention on Twitter from accounts that have been calling tokens well. Twitter is full of fake activity such as engagement farming, paid shills, and other content that distracts from finding alpha, so it’s important to filter that out as much as possible.

Using the method described here, we’ll first find Twitter accounts that have been calling tokens and projects well over a predefined period, then use that initial filter to find the tokens they’re talking about now. Finally, we want to look at social momentum to ensure that we are not too late to the game.

Step 1:

Twitter can be noisy, so it’s important to separate signal from noise.

Go to our account screener and choose a timeline that you feel comfortable trading in. Typically, we at AlphaScan use a 60-day timeframe for medium-term opportunities and a 7-day timeframe for short-term plays.

Sort the results by the 30-day performance when looking at longer time horizons, and by 1 day for shorter time horizons.

You will now see the top performers within your selected timeframe. Note down the best 10–15 profiles and duplicate the tab.

Step 2:

Now, let’s see what the mentioned accounts have been discussing in the past few days.

Go to our View by Token feature and filter the results using the search box at the top to display only the mentions of the accounts you noted down. However, even these accounts might have mentioned hundreds of tokens.

Let’s focus on the tokens with the best price action. Sort the results by the 7-day performance after the tweet.

Step 3:

Next, open the filter option on the top left. We are not interested in every token, so let’s be a bit selective for what we’re looking at.

Scroll through the token filter up and down, and directly filter by tokens that have been mentioned by multiple top performers and have demonstrated good price action.

Click on “apply” and see all the tokens that are interesting to you. Click on the token logo to learn more about it. Exclude tokens with fake volume or unreliable price charts.

Step 4:

Your shortlist is coming together. Note down all the tokens on your list and return to our Account Screener to analyze each token separately.

Filter the results by the tokens from your shortlist.

What you want to see is a consistent trend: the number of mentions should not decline significantly. You want to observe an increasing number of mentions in the past several days, as more influencers may join in and the token starts to gain attention from a broader audience. If there are only mentions that are for example 2 weeks old or more, the attention might be dying down.

Now… finding alpha is one thing. Being able to act on it fast is oftentimes as important as finding it. Stay tuned for further updates on how we here at AlphaScan are going to solve that.

Disclaimer

AlphaScan is operated by AlphaScan Ltd., a British Virgin Islands limited company. AlphaScan is an analytics-based information provider. This material is being provided by for general informational purposes only. Views or opinions expressed herein may not reflect those of AlphaScan as a whole and may change without prior notice. Nothing in this material constitutes investment, portfolio management, legal, accounting or tax advice, advice on trading techniques, models, algorithms, or any other schemes, or a recommendation to buy, sell or hold any digital tokens or other digital assets. No recommendation or advice is being given as to whether any digital asset is suitable for you. No solicitation or offer of any digital asset or financial promotion of any kind is being made. You should not trade in digital assets unless you understand the associated risks. This material contains forward-looking statements — statements that relate to future events or future performance — which are only projections, opinions and hypotheticals about possible future events, conditions, outcomes and results. Actual events or results may differ materially.