For some, trading and investing in cryptocurrencies is synonymous with technical analysis. For others, technical analysis is just a community-driven passion.
After spending countless hours doing technical analysis, Joe Bezzani and Jon Farjo found themselves using Twitter as a trading source. Together, the two came up with ideas and used the knowledge and experience gained in well-structured traditional businesses to bring new products to the crypto market.
Speaking to Cryptonites’ Alex Fazel in London, Vezzani and Farjo said it took two years of trial and error to settle on the idea for LunarCrush. I tried to find a way to judge the overall trend of the crypto market by
Fajo explained that Luna Crash It works by drawing insights from social media. The platform collects approximately 3 million opinions daily from Twitter, Reddit, Instagram, YouTube and other social media platforms and uses advanced algorithms to determine sentiment. The more opinions the platform aggregates, the more it helps us make sense of them. Farjo says that each interaction with the community makes LunarCrush and its datasets more powerful and reliable.
This makes LunarCrush one of the best social analytics platforms in the cryptocurrency market. The platform enables users to make sense of the billions of social media interactions that occur every day and determine what the wider community thinks.
Farjo said most traders rely on technical analysis, but social analysis is underutilized. He believes that technical analysis provides insight into short-term price movements available only to a select few traders. But social analysis provides the foundation that technical analysis is missing.
“Volume doesn’t create itself, and price doesn’t drive itself,” says Farjo.
It is the community behind the coin that creates the volume and pushes the price up or down.
Vezzani said tracking community engagement has allowed LunarCrush to capture some of the biggest and most promising cryptocurrency projects in their early stages. Community engagement on Chainlink, Solana and Avalanche was visible on the platform early on. Also, initial network growth is a lot like ongoing community growth.
Farjo noted that the growth of the community is highly correlated with an increase in the number of wallets and an increase in the total number of transactions on the network. This will increase the price of the token.
“Community creates the price,” Farjo said, not the other way around.
