Navigating Success in Crypto Trading

How to make money trading crypto? I've received a lot of requests to explain my narrative dashboard and go over some of the charts. So here we are. Let me first start with an introduction to narrative trading and then we will talk about the dashboard and the charts that it contains. Okay, so basically when you are trading you have a few elements, a few things that you have to figure out for yourself. First is what you want to buy, what kind of assets, then when you want to buy and then how much you want to buy. So the first thing for crypto could be just buying Bitcoin or alts or narrative trading. For when you want to buy, it depends on your trading strategy. So you can use technical indicators like RSI, moving average, crossovers, etc. Or you could trade based on sentiments or an index like fear and index sentiments or funding rates, order books. There are really a lot of different styles of trading. and it really depends on your preferences. Then you have to figure out how much you want to buy when you have an entry and an exit based on your strategy. So this depends on your risk management and your risk profile. For the purpose of this video we will just talk about the first part which is what to buy as we are focused on narratives trading. So in crypto if you go on CoinMarketCap you would see that we have there are more than almost 10 000 tokens. just listed on coin market cap coin gecko and if you go on the screener you will see that it's much more more than 20k tokens that you can actually buy and sell on dexes and also centralized exchanges so with all these options what should you buy how should you build your portfolio okay let's now talk about our objective here as a narrative trader so it's important to think about what we're trying to achieve because we can always hold bitcoin and just do nothing as we said so our goal is to outperform the market and by the market we need to i mean we need to we need a benchmark which is usually a bitcoin or ethereum or stack ethereum but but for the sake of simplicity we will take bitcoin in this example so as a narrative trader what you're trying to do you're actively trying to find the best assets etc and in order to outperform the market so there are different ways of measuring this one is this cap and formula here and so let's just quickly look at what this is saying so this is alpha which is the excess return that you are generating from your portfolio and investments so here we have roi which is the return of the investment or if the risk-free rate which in crypto we don't really have risk-free rate but let's suppose that lending like stable coins on for example ave is our risk-free rate although it's not risk-free but it generates something uh let's say around five percent per year and then we have the bit beta which is uh we can think about it as the correlation of our investments to the market and the volatility and we have finally the re and the return of the market so what this is saying is in order to generate alpha or your your goal is to maximize this alpha so generate as much as alpha as you can how can you do that so we have a subtraction meaning that you want to have as large as number as possible here for ri and as little here as possible to maximize this alpha number so in a bull market environment um it's very important because it's important to know that you're not just trying to make money but you're trying to make more money than a benchmark which recently at least at the time of recording in march 24 bitcoin had has had a very strong performance in the last few months. So not everybody has outperformed the market. And if you consistently underperform Bitcoin, then you should really ask your question, is it worth all the efforts that I'm doing? And you might be better holding Bitcoin. And it's for this reason that you should really understand. And especially in a bull market, it's maybe not difficult to make some money in USD terms, but are you actually doing better than you know ethereum or bitcoin etc if you're not you better just hold that so let's let's skip and give some numbers here so let's say if you're in a pool market environment and you've generated 50 per month or per year or whatever but just let's say per per year so 50 here and let's say that bitcoin has generated 100 returns and so this would be our m would be 100 our risk free rate we said is 95. So 100 minus 5, 95. For the sake of simplicity, we will take 1 as a beta correlated to the market, both positive. So 100 minus 5, 95, we have our risk-free rate again here. So 95 plus 5, 100. And we said our returns are 50. So 50 minus 100 is minus 50, which is actually you have underperformed the market. So we have a negative alpha. There is no excess return. So although you made money and you had 50% return, you underperformed the market. And so this is important to really understand this concept. deeply and it's because of this reason as we will see in the in my dashboard i'm using btc or ethereum as benchmark for all the narratives and all the um assets that i'm that i'm actually following is exactly because of that because you want to outperform the market so let's talk about few examples here to better illustrate what i mean by outperforming the market and narrative trading So here we are seeing a curve CRV which is one of the very established DeFi protocols and we are seeing its performance against Bitcoin since 2021. And you can see that actually from the peak of the bull market near December 21 it has been a very steady downtrend. Even until today, in the last few months, the market has been pretty bullish. But if you look at the Bitcoin pair of curve, you would see that it's still going down. And it's down 93-94% from the top. If you look at another example, here we are seeing Cardano, ADA Cardano, again, performance against Bitcoin. And you also see that since August 2021, it's in a downtrend and it's down near 87%. Um. and so this is this means that actually you would be better holding bitcoin rather than holding these assets that i've shown here and if you look at another example here ethereum against bitcoin even ethereum so we know that historically um bitcoin outperforms ethereum in a bear market that's the pattern you're seeing here and here and here here and so but there was a catalyst during d5 summer in 2020 and the part of the bull market where everything started to flourish on DeFi, NFTs, all the different protocols and so that's where Ethereum started to outperform Bitcoin strongly during that period. And also during this period, as you see, during this short period in 2022 from May until September, what happened there, Ethereum transition to proof of stake. And so this created a new catalyst for Ethereum to outperform Bitcoin, which was by the rumor, a selenious kind of event. And even in the last month with Ethereum going from 1,000 to now more than 3,000, you can see that compared to Bitcoin, Ethereum has underperformed. We know that because Bitcoin ETFs have actually been a strong catalyst for Bitcoin. So here, we are mentioning the catalyst that actually can have a very important consequence on the performance of trades of different tokens. Now let's talk about narratives. In 2021, we had the L1 narrative, which was one of the best performing narratives back then. We had Solunavax with Sol, Solana, Luna, and Avax, which all had a great performance during the bull market before the crash of Luna. But during that period, as you can see, again, we are seeing the performance of these assets against Bitcoin and you can see how they really outperformed Bitcoin during that period. And so if you were a narrative trader back then, then you probably had exposure to these L1 assets. And these were some of the best. There were others like Fantom, etc. but you get the idea actually we are seeing strong outperformance of the market during that period on these l1 assets layer ones another one was actually a gamefly gaming assets during the same period of the bull market where tokens like axie infinity or sandbox or gala etc they all also performed really strongly and and this is another scenario of narrative trading where a specific sector um crypto assets have actually outperformed Bitcoin in a very strong way. So this is the power of narrative trading. So there exists a lot of different narratives now more than 30 I've listed on my on my Doom dashboard. I have a thread about that you can see the different assets for different narratives but very briefly we have obviously everything related to infrastructure. uh layer ones layer twos oracles we have nfts we have ai we have privacy real world assets uh dpn and memes etc etc there are many of them and so this is a good introduction to go on the dashboard and start So I would basically want to explain how I'm using this dashboard myself, and how I use it to understand past trends, and how I use it to inform my decisions for the trades and investments that I want to make. So I'm going to share all these links here, so don't worry about that. This dashboard has a lot of things, so let's actually break it down. It actually has three main parts, an overview of the different narratives, and the state of the market, then a breakdown of each of the narratives with details about the specific assets that constitute that narrative and how they're performing relative to each other, etc. And then there is an ecosystem section which compares different blockchains together. So how is, for example, Solana performing against Avalanche and Polygon, etc., in terms of the assets, the native assets on those blockchains? So let's start with the first section. So I would say this first chart is probably the most important chart on this dashboard. I mean in the sense that it has information that is really useful for training and I personally use this one a lot. So what is this showing? So this is showing the performance of each of these narratives from the start of the month to a day. So today we are the last day of February and so we are seeing actually a full representation of the entire month of all narratives. So let me actually open that so that we can see better here and let me zoom out. Okay, so here we are seeing the performance of all the narratives. We have the identity narrative as I've called. By the way, you have the code and the details of everything so you can actually go and look at the details on how this is done and what are the different assets of each of the narratives etc etc but identity narrative has been the strongest performing one i don't want to enter it here in this video into the details of talking right now what's hot and why is this and the best performing narrative and what should you invest into because it's not the purpose of this video i just want to make an educational video about how i use this um this dashboard But I would use some of these as example to how you can think about narratives and how you can use them and trade them and see actually patterns. So for example, identity has a few assets that I've listed as index of the identity narrative, which is a word coin and then Ethereum name service, ENS, word coin is WLD, and the last one is identities is another actually identity related project. So what happened here this month was that OpenAI released their Sora video generation text-to-video service and this because the CEO is the CEO and the CEO of OpenAI, Sam Altman is also the CEO of WorldCoin, then there was a surge in the price of WorldCoin and then this is why you're seeing a strong performance here for this identity. so WorldCoin is the main contributor to the performance you are seeing here. So why is this? Specifically, this is a good example, because personally, I wouldn't pay too much attention to this one right now if I wanted to just take some action based on this chart, because I know that that was just a news thing and there is no long-term momentum into this specific narrative. That's my opinion, by the way. others might not think the same but for me that's i just see it as a you know this sora release that affected the price of word coin but it's not as if all the identity projects are now proper and outperforming etc so this was uh if you remember the actually here i mentioned two things we have narratives and catalysts okay so catalysts are usually short time short term based on an announcement or something and so Here, I'm seeing this as a short-term catalyst, but I don't see it as a long-term potential thing for the entire identity narrative. So here, I'm ignoring this narrative, and I don't care about this outperformance, and I just accept that I missed this opportunity. And now, moving to the next ones, and what can I see here? So memes have been performing strongly from, you know, Pepe and Bitcoin. and other meme coins, they have had a strong performance this month, which is usually an indication of the market going on risk-on mode. So if memes is something you like and you're seeing this, then it means that... there might be opportunities in this sector. And by the way, let me say one thing of actually how you can use this is basically the idea is that either you are a trend follower and so you see these performances, outperformances, and then you think, okay, then I think that there is something behind there and I think there will be continuation in the future. So I'm seeing this outperformance on memes. So actually I want to focus on memes for the next week's month. and just trade memes okay this is one way of thinking about that and the other way is you are more into mean reversion meaning that you see what is not really performing well maybe it's actually and ranging accumulating and so he you would look at this region here on the right side and so here for example something interesting to me would be nfts which have not had a great performance this month relative to others as at least that measured as measured by by the index that i have here so if you're into nfts you might think okay actually the market is in general going up but nfts are not yet outperforming so maybe there are some cheap opportunities some cheap nfts that i could buy and and just hold waiting for nfts to wake up and start outperforming so these are just two approaches that you could have either look at the right side and look what you like here among these narratives and what you think is kind of um undervalued and might go higher in price for example uh stuff like that have good fundamentals like oracles d5 2.0 lst protocols etc etc could be opportun could have some opportunities and on the other side if you're a trend follower you can just look at what is here okay on the left side and then decide Okay, I see that, for example, AI, the AI narrative has had a very strong outperformance, not only this month, but actually in the last few months consecutively. And so you could see that two months ago already and then decide to, okay, I think that there is something behind that. It's not just a short-term catalyst. I see this as a long-term opportunity. And then you could go and research deeply. this narrative and the tokens and the projects associated to it and then focus and adjust your investment accordingly. So this is generally how I look at that. Usually another thing that is important is usually I do not recommend to just look at this chart once per month or something like that because the moment you will start to see the patterns and the small patterns when you look at this very regularly because for example bitcoin narrative for example let's talk about bitcoin narrative this wasn't among the best performance performers in the last few months it's a recent thing so if you were paying attention before and if you look looked at this chart regularly you would know that bitcoin is usually around this part of this chart you know not among the best performance and so if then you regularly check you would see that okay actually bitcoin is starting to move to the left side so and and it's subtle right so if you look at the numbers here 29 30 31 33 it's not that if you just look at the picture you wouldn't get too much information you know on one snapshot but if you if you look at it regularly and you always know that for example bitcoin narrative is always in this region and now actually is outperforming the the other narratives and moving to the left, then this is something that could indicate the start of a new trend that you might want to pay attention and you might want to research more closely. Okay, so these are a few of the important things I wanted to mention about this chart. Other charts are, I will mention other charts, but I think it's important to go deeper on this specific chart because it's very important. One other thing I wanted to mention is that Again, if you look at this for a long time, you would realize that some of these narratives are always on the right side of the chart. They do very rarely cross this region. And so these might be the ones that you do not want to pay attention. Or if you have tokens there, you might want to rotate to other narratives that are trending. Or you might want to define your own rules or triggers. that'll like okay if for example i like nfts but but i would wait until i see them somewhere in this ranking to start paying attention again or to start allocating it again to the NFT narrative. This is some of the things you can do looking at this chart. On the other side, you could also do the same thing on the left side, meaning that if the AI... So as I mentioned, the AI narrative has been outperforming for quite a long time now, but at some point this will stop, right? So at some point, the AI narrative will start to move to the right side. I don't know when it's going to happen. And as I said, I don't want to focus too much on which narrative is the best, et cetera, right here. I'm just talking about trends and things that you can see on this chart. But at some point, some of these narratives, they will move to the right. And so again, you might want to define your own set of triggers to say, okay, if I'm into AI, but I start to see this moving actually to the right side at some point. and then some of these moving to the left side, then I might decide to rotate accordingly based on your preferences. Okay. So just some general observation I can also share is that some of the, for example, some of the established projects like money markets, like things like AVA, et cetera, these kinds of lending and borrowing protocols, these are generally not outperforming in the sense of, yeah, outperforming the other tokens that we can see here. And this is a very consistent behavior. It's not just this month, it's like every single month they are on the right side of the chart. So this is, for example, very easy to see on the wallet tokens, you know, things like Trust Wallet, TWT or Coin98 or these kind of tokens. It's also true for options, you know, that they have been underperforming. It has been true for privacy tokens. It has been true for derivatives and perps, things like GMX, DYDX, et cetera, et cetera. And so I've shared recently a tweet about why I'm no longer actually holding or trading any kind of derivatives tokens. The reason is exactly because I've spent a lot of time looking at this chart. And I've been able to see that the market is going up. And I've been able to see that the market So if as an investor, what you're looking into, or as a trader, you care about the outperformance and the token appreciation of what you're holding, then you should actually spend a lot of time here because, for example, GMX is a great protocol, is a great business. They have a lot of revenue, some of the best among the DeFi protocols. They are very established. They have a very high volume. And they are building, they built GMX V2, they are building their app chain now, a new announcement. But ultimately, so it's a great business. If you're a fundamental, like kind of Warren Buffett kind of investor, GMX is a good token to hold. However, if you're a narrative trader like me, and you look at these charts and you look at what is outperforming, you would know that. No matter what happens and what kind of announcements in the derivative sector, usually they do not go to the left side of this chart. And this is true for many of the narratives here. The same thing for DEXs. For example, I mentioned again, I tweeted about that recently. There was this Uniswap fee mechanism proposal. And so Uni jumped 80% in February. But... But still, even with that, you can see that DEXs in general, not just Uniswap, but SushiSwap, PancakeSwap, Curve, Camblo, Grid, and others in general, although the performance is not too bad, is more on the left side, but still is not among the top five, top six. So that's why I also ignore these kind of tokens. This is yet another kind of pattern that you can observe if you look at this for long enough. And then last thing I would want to mention, and this is becoming a bit too long on this chart, but I think it's worth it because I think these are some interesting patterns to observe. And so last thing is there is always rotation, right? So the first, it happens rarely that for consecutive months, the first narrative identity here will be also the first next month and the month after, etc. So. There is a lot of movement in this chart, although there are patterns, there are clear patterns as I mentioned before. Some are, statistically speaking, some are more on the left side, some are more on the right side, and some are just kind of... actually too much correlated to the market. So if you remember the beta that I mentioned in the introduction, they have just a high beta to the market or to Bitcoin and so there is no kind of strong outperformance of the market. Okay, so with that being said, let's go back to the dashboard. So here you can see the performance of all the tokens. There are now close to 200 tokens. narrative tokens that I track on my dashboard. And their monthly performance MTD and on average, like median as it's written. So in February, actually narrative related tokens are up 31%. And from the start of the year, they're up 25%, meaning that January, we went down on average around 6% or so. So this is important because you can use that as a benchmark for your own performance and seeing how much did you outperform that. So this is a median. So if you're a native trader, you could use that as a median. It could be a measure or you could use just the performance of Bitcoin or Ethereum or staked Ethereum as a benchmark. But it could be an indication. OK, so here in this section, we are talking. talking about trend reversals, meaning that tokens, as it's written here, these are narratives that were mostly on the right side, but now are all of a sudden in the last two, three months moving to the left side. And so, for example, identity is one of them. And because there was this catalyst, this news and news related thing that I mentioned. So an identity, the identity narrative was not always here okay ai also although um it was mostly on the left side but not always on the third place and also the bitcoin narrative right the bitcoin narrative is having a great time and um i am very bullish on it but i said as i said i let's not talk about the specifics of narratives so now here you are seeing the performance from the start of the year which will give you a broader picture of what's happening you So one thing to know is that these are MTD and YTD, meaning that they will reset here. They will reset at the start of every month. And so tomorrow is the start of March. And so everything will reset to zero. And then, you know, so for example, on tomorrow or in the next three or four days, you might not see a lot of signal just looking into this because things are still developing. So that's why I think having YTD is important. And also. zooming out and also there is some kind of alpha comparing these two okay so for example if some narratives are here on the right end side of the things of this chart here and on the monthly they are on the left side then it means that overall across that year they underperformed but underperformed but now they are actually outperforming This happened with NFTs in November, and it's a pattern that I mentioned. NFTs were the least, the worst performing narrative of the year in 2023. So they were here. But in November, at some point, they were the first. OK, that's where Puget Penguins, they started to trend really strongly. And so that was, for me, an indication of, OK, now NFTs are waking up. And it was a clear sign. And actually, that's... was kind of the bottom for NFTs. And from there, they have been trending up in USC terms. However, they are, at least in February, they were not among the best performance. So comparing these two charts is also interesting. And for example, now we are just coming to an end of February, the second month of the year, you can see that Identity and AI, they are still actually, even in January, they had a great performance. It should be said that ENS, Ethereum Name Service, had a great run in January. And so it's also contributed to that, as well as the Space ID, which is the other token in that category. And the same thing holds true for AI narratives. A narrative with very trendy tokens like R&DR and TAO and FET, FET, FETCH, etc., etc. So... yeah, these are some of the patterns here. Then you can see the risk adjusted returns. From 2023, this can be mentioned about the beta and the volatility. And so, for example, it's pretty common to see memes, although they outperform here, for example, and they are second, but they have a lot of volatility and sometimes they go down 80%, 90% in a month or in weeks. So they have a lot of volatility, which means if you measure the risk-adjusted returns, they are not among the best. narratives of course and then you can see for example here lsd l2 projects like pendel and defy 2.0 and bitcoin narrative being among the best interestingly money markets rarely outperform in terms of dollar terms but because they have lower volatility they are actually they have good risk adjusted returns so for more conservative investors and traders they might want to look into this. Okay, so we have the volume. You have to be careful here, because we don't have everything on DEXs and all the activities, so just be careful when you look at that. But it could give an indication for some narratives, and if you want to know where there is liquidity, for example here, sometimes it's interesting because, for example, DeSci decentralized science was one of the best performing narratives in Q4. but it's all just very small cap projects. So you would see them here in the first position, but actually when you look at the volumes, it's almost nothing. So there isn't a lot of liquidity in these projects, which if you're an investor who wants to put size, then this might be a consideration for you. Because we said that these things reset at the start of the month, then, and also to give a broader picture, there is also a three month performance here. this is working progress because i have to add the other narratives but you can already see here there are some already good patterns l2s and l1s and ai have been performing well now um we come to the news to this section where we are actually now talking about tokens and what what tokens are performing better so this is and these are again all narrative based um tokens and so here you can see the projects that are close to their all-time high. I will go a bit faster here because it's pretty obvious what it is, but still I will just mention maybe why it's important and how you can use it. So usually the idea is that trend following is a strategy that works really well in crypto. And so it's the easier version, I would say, compared to mini version. And longing strength is something that you should do, especially in a bull market environment. Let's see what is in a... close to all-time high region or in an all-time high region and then actually just um just during price discovery zone and so and there is highly it's highly likely that they continue to go higher so if we go on a trading view for example and we take we check fat if you go on two weeks you can see that here is already in all-time high region okay and so this is a bullish one if you look at stx the Bitcoin layer 2, you can see that it's close to its all-time high. If you look at Injective, same thing. So if we mentioned that there are like thousands of tokens, etc., these actually are giving you clues on what you should buy or what you should hold. And these are all very valid options that I think are very strong, you know, as you can see from the price action. And so you should actually look then into what kind of narratives they belong in. into and what are your preferences and how well you understand them and then actually just trade or invest accordingly. Then if you're into mean reversion you might want to look into that which is how far the top 15 narrative tokens that are the furthest away from their all-time high. Although I don't really suggest this strategy because it really works but still for example just looking into the names These don't look very attractive to me. Things like EOS or what can I say? ICP. Let's look at ICP. So as you can see, this went down. I mean, it almost went to zero. And now, of course, it bounced. But still, it's very far from its all-time high, right? But the reasoning of I should buy this because in the bull market and this will go back to the all-time high is questionable because this rarely happens right so i really doubt that icp will make it i mean let's not again talk about specific projects etc but you should ask yourself if if the projects will really come back if they have a strong community etc same thing with cardano Of course, it's very far from its all-time high, maybe not that much compared to others, but still, you might want to look into this. And some of these projects, again, also, there are. Yeah, so, of course, in theory, when you look into the chart, there is an upside potential. But then, because the attention is mostly on, you know, the trending stuff and the new stuff and what is... and this is what everybody is talking about so how likely is is that these ones start go back to their all-time highs i'm not sure but sometimes there are some good projects here for example axi you might argue that axi is a good project and it might come back in a bull market environment with new participants and so you might think that actually i like gamefly you can actually then go deeper into unchained data and see okay you can go and run in and then look at the activity on chain and look at some dashboards. Is it having an income of new users? Is the number of transactions going up? Is the community strong on social media? All this kind of stuff. You can then take your decision. And interestingly, Filecoin, which is a promising project, especially with the announcement that they made now recently, collaboration with Solana, etc. you might think okay actually i like this one file coin and so so yeah this is for a mean reversion trader or investor you can look at this you can combine these these are all preference-based stuff you know you can actually build a portfolio where you buy a few of these and a few of these based on your preferences etc okay let's move on top top 10 performing assets okay so these are the best performing assets of the month uh so we can see here there is a lot of um like ai related stuff like chain gpt like fetch like uh ajx like word coin uh we might argue that it's not ai but uh probably it's because of ai that it's pumped and as well as this one so um this is the best performing asset of the month among 200 assets you might want to look into this you might want to look into this generally and see okay actually the best performing assets of the month are mostly ai related stuff so maybe i should really have a look into all the ai stuff maybe it's really trending and so in general among the 200 assets the average performance this month was 38 and so this is very strong performance you can see here and then the same thing for your start of the year you can see almost some of them are here but for example pendel had a great performance as well as ethereum name service and tao and sui and chromium the game fire project these had better performance in january and so they are not here in the list okay and by the deep opportunity so again similarly this is for trend followers going long and if you're a mean reversion you might want to look at these ones and so these are the worst performing so this gamble fight project let me change the time frame this is a new listing yeah so this gamble fire product is down i'm not probably better to look here yeah so it's down 15 to 20 percent or something so um again if you're into mini version or for example this is interesting this is a very promising project, TIA, P-Tensor, AI-related. This is Frax. Frax has a lot of catalysts. And it's here. It didn't have a great month. But if you like, again, kind of Warren Buffett kind of style of trading, you might see that, okay, there is a lot of bullish catalysts on Frax. And then you might want to see that as a good buying opportunity. role bit as well and then here again the same thing for the year. Pepe has a deep apparently GLD etc. Okay so now we have defined a narrative which is just an index actually that usually constitutes of few tokens and then I have taken an equal weight average and so we can plot the performance of these across time and then have this actually things that look very noisy, but you can actually filter out these things and then actually you can see what's interesting to you. So for example, if I like L1s or L2s and GameFi, I can let those and then I can then see how has been the performance of these things compared to each other. So you can see that there is a general trend in the market, at least among these narratives. but we know that's the case in so far 24 has been a good year but yeah not a very obvious kind of pattern here they all kind of mostly follow the same trends but yeah GameFi has been maybe has catched up to some of these narratives so this is interesting so this is a pattern that I can see here for example it allows you to have a broader perspective across time. Here is last three months and here is since 2016. And there are very interesting patterns to see here. For example, if you want to study that at some time, at your convenience, we mentioned about the layer one narrative in 2021 and the memes. These are things that you can clearly see. You can see actually this also allows you to see patterns of how long a narrative can last, how long historically, like the best performing narratives for how long they outperform, what happens next. You see this kind of, you know, up and down kind of things. It might allow you to time better your entries and exits and all this kind of stuff. So I think this is some interesting information here. Then we can see here the average performance of different narratives across time. So there is an outlier here, I think it's a decentralized finance, which had such a small market cap that is now not allowing us to properly see the other things. I should cap that. But anyways, you can see actually the performance of Bitcoin here, for example, 2022 January minus 16, the average performance of narrative. So and also the maximum performance of the best performing narrative. So again. this can give you some indication of when Bitcoin is outperforming, when narratives are outperforming and see trends. Here is, I like that a lot, it's history of narratives and it tells you the three best performing narratives and worst performing narratives of each month. And so for example, you should ignore the first row because for now at least you need to wait for the month to close for this to be relevant but that was a small note let's search for example bitcoin and so bitcoin narrative which is bitcoin itself and stacks stx and other related tokens have had a great performance in 23 actually there were at some point two times they were the best performing narrative and that's when bitcoin etf news actually came here and so they were the best performing narrative and although the average narrative on average narratives were down uh around minus mine minus four percent the bitcoin narrative was up 64 percent here and uh 74 percent here and you can also see uh okay at some point it was third uh you can actually filter that by date and uh in the last month i mean yeah in the last month it hasn't been among the top three and you can also see when it was among the least best performing ones so here in 2021 um it was not it didn't perform well the bitcoin narrative etc if we look at um other narratives for example ai there are a lot of lines so ai is either uh many times has appeared as the best performing narratives or as the worst performing but you can see has been among the best ones. If you filter by date, yeah, you can see here AI. And so, for example, this was, I think, when ChatGPT almost came, the first version, that was the start of the AI narrative boom, and et cetera, et cetera. You can also check NFTs. Last example. So NFTs, we know that they did really well in 2021 in the bull market. So you can see them many times as the best performing narratives here, especially in June 21. It was a bearish month for entire crypto, but NFTs were exploding. Interesting observations here. as well in july etc and then in 22 they had a really bad year so you can see many many times they were appearing here among the you know consecutively the nfts were among the worst performing actually where the um where the nfts was the worst performing narrative of the month for many months in 2023 and also you can see the ranking of you know the average overall average returns So for example, so far, the best month overall has been May 2023. Again, you have to be careful because, yeah, this is because of decentralized science, which has kind of skewed everything. But if we ignore that one, then there are some interesting observations. For example, we know that the first month of last year was bullish. And so it was one of the most bullish across all times. And we also know that we had the... bull market in 21 so in october it was one of the best month again interestingly memes were among the best performers etc etc and you can see the worst performing month uh that was obviously obviously in the bear market of 2022 remember that very well in may in june uh in november okay and in november because for example just a random thing that i just saw november what happened ftx went bankrupt and so there was a lot of fear and everybody was actually withdrawing from centralized exchanges and so look what is here the best performing narrative of the month is wallets because people started to actually withdraw their money from binance from ftx from everything and they started to put them into things like uh trust wallet and safeball and coin 98 and so the month the market was down 16 overall that month at least on the narrative assets but the wallet narrative was one of the few times that it was actually among the best ones but here it was the best one so and as you can see the second best performing one was perps maybe because there were a lot of liquidations i don't know and some of them they do they share that revenue but in any case you can see that there is a big difference here 20 20 21 percent 6% and the third best performing one was NFTs which is usually uncorrelated to crypto markets and even that one was negative and if you look at here the worst performing ones we can see that really we have some bearish numbers. Okay so then you can see there is seasonality in crypto that's important and so again there is some outlier here but so if I remove that you can see some patterns that are interesting here for example we know that um Q1 and Q4 are generally bullish quarters in crypto. And Q3, we always know that it's really not really that bullish, especially September, as you can see. And so these are some of the things that you might want to consider as a general framework. And you can actually integrate that as one of the metrics of your considerations for your risk management or for how much you want to have in stables, etc. If historically since 2017, June, or September or August have been bearish month, you might want to consider that or not. And then if historically April and Q1 and Q4 have been bullish, then this is something you might want to look. Okay, so now large caps, narratives and large caps. So it's important to know the difference in performance of Bitcoin, because as we said, you're putting time and effort into that. to trying to outperform bitcoin right because you can just easily just hold bitcoin and do nothing as many people do but if you're putting your time and effort you want to outperform holding bitcoin right so what assets are outperforming bitcoin why is why is important to trade narratives in my opinion for example you can see here already top five top ten top 50 20 30 all of them are underperforming holding bitcoin okay that's a big thing so if you if you hold all of these you know you hold all of these you hold all of these etc you would underperform just holding bitcoin so that's a lot because you pay in gas fees there are more risks maybe with some of them um and there is a lot more effort to manage your portfolio um risk adjusted returns are will be worse but you're still underperforming bitcoin So what's the point of doing that? However, if you look at the performance of top three narratives, then... you can see a clear difference okay this is top three it changes every time these these usually do not change that much but still there is a big difference right at least 2x difference more than 2x so there is merit into looking into narratives and as we said if you stare for long enough into these charts i promise you that it's not that hard to eliminate some of the least interesting things like as i said wallets money markets and some of these you can options gamble fi i mean it's it's uh it depends on what you like etc but uh you will at some point see consistently some patterns and so it will not be that hard to uh also considering the assets etc to find some real alpha here and focus your attention on what's trending and what's going up okay so uh again here if you're a more conservative trader you might want to say i just want to limit myself to top 20 assets by market cap because they are more established, they have less volatility, I'm more comfortable with that. Okay. Then you can see again, uni, for example, that was a catalyst of a fee mechanism switch. It had a great month. And now it's your job to see, okay, is that a short-term thing or can this be sustained? And is this a big change? Again, I have my opinions, but I don't want to enter on these topics right now. So these are some of the things you might want. What's happening with Filecoin? Why is it outperforming? Doge has been performing well. SHIB and Doge, we said that meme coins are performing well this month. So in terms of rotation, we also know that when meme coins start to outperform, maybe it's the end of a rally. So again, these are all different things that you can consider and all the things that you have on your brain model or investment model. So a top 50 assets, I think for me, that one is a bit more interesting than these ones. There is more happening. So layer two, Bitcoin layer two, a uni, a graph, a file coin, R&DR, et cetera, et cetera. IMX, the gaming protocol. Some of these, yeah, I'm surprised to see. Again, for example, HBAR. I don't know the catalyst, but I don't. pay too much attention to that, at least this is a one-timer thing for me. If I see it maybe next month, I would pay more attention. But for example, IMX, of course, I'm paying attention. Again, I'm sharing these examples not because of the project itself, but just to give you an idea of how we can think about this. IMX has been performing well, not just this month, but in many months, in the last month. It belongs to the GameFi narrative, which I believe is strong. the same for rndr the same for stx so when i see these things it actually reinforces my beliefs and my biases for you know holding them etc and so you might want to look at your stuff and your preferences and then decide accordingly okay so now we come to the second part of the dashboard which is a narratives breakdown so um Here we are breaking down all the assets that constitute this narrative and we are seeing their performance relative to a benchmark. This benchmark is always Ethereum except for the L1 narrative where I thought it doesn't make sense to compare them. I mean, it might make sense, but I didn't use Ethereum as a benchmark. I used Bitcoin. So, yeah, let's focus here. So here you can see actually the performance of. all these L1s, it's not an exhaustive list but it's good enough. And so you actually first, at first glance you can see, so as we said, you want to make money, this is one thing in USD terms, but you also want to outperform the market, that's why you're seeing the BTC pair here. And so here, for example, just looking at this more closely, you can see for example, CAVA, just a downtrend. although if you look at kava in usc terms maybe it's going up but it's underperforming kava so i'm not interested eos the same thing but on the other hand xrp the same thing trx the same thing telegram turn coin same thing but on the other hand the i'm seeing some strong uptrends like sui like say like solana etc so these are some of the things and of course and gno right gnosis some of the things that I might want to pay attention to, or you might want to pay attention. Now here again, we already discussed in detail these charts, so I'm not going to do it again, but as I said, I don't want to enter into the details of what assets are good or not, but if you're into L1 narrative, okay for example which i i like l1 narrative i think it's good to have exposure to some infra project narratives like l1s l2s um you might want to have a deeper look into this narrative you know for example you can search l1 on the dashboard it will bring you here and then you can see okay i like l1 narrative which token should i buy should i buy bmb should i buy xrp and so you can see the monthly performance ytd performance more importantly you can see the performance you against bitcoin now here we have a very interesting pattern here i believe we are seeing all these almost everything is up in usd terms and uh however almost everything except few ones are down in btc terms meaning that bitcoin is outperforming outperforming all of these guys so let's look at let's look at an example bnb is up this month uh yeah it's up what something like 30 percent but if you look at bnb btc then it's it's down right it's down it's down like five percent or so so you can see here it's up like 36 percent and uh it should be somewhere here it's down like five percent okay here so um again our performance is what you're uh what you're interested so for me i would look at this part at the left side and see what's interesting Gnosis is again, this is a pattern that is not just this month. And that's why again, I want to emphasize on that. If you just look at this, you wouldn't know that Gnosis is very actually strongly trending because this has been a consistent pattern across the last month. Okay. Gnosis is outperforming Bitcoin. Ethereum for the first time after a long time is outperforming Bitcoin. Again, I know that because I look at these charts every day and I know everything here. So Ethereum has been underperforming Bitcoin for many, many months. But for the first time, although at least until four hours ago, although Bitcoin had a very strong month, Ethereum is outperforming it by just a little bit. So still, this is a pattern for me. I don't care about that number. I mean, I also care, but I care about that. But I also care about the position of the assets that I like. If I like Ethereum and Ethereum was always in that region, then now it's here. So it might indicate that now the trend has changed and it's time to pay attention to Ethereum, maybe. Again, okay, so this was MTD. Now, here is what I really like, these kind of patterns. Look at this, just a good coincidence. So SUI, new generation L1, is the worst performing of the month compared to Bitcoina, okay? And it's the best one in the year. okay so meaning that it had a great month in january but now it is there has been a pullback so for me if i believe that new generation l1s or specifically sui is an interesting project then i see this as a very clear opportunity and i don't even need to look at the charts because this is telling me everything i need so we had a great month last month and sui is now down maybe people took some profits and so this is already a buying opportunity maybe for me or at least a dca opportunity or scaling in opportunity and i don't even need to look at anything else uh if i like if i've already done my homework and i know that project and i know uh how they are doing and i follow them on social media etc etc i can just go and buy sweet for uh again i'm talking about this as just an as exam as an example okay but let's look at sui so sui in usc terms it's not that bad right in usd terms when you look at that chart it's not i mean that parabolic thing has broken but it's it has been a really healthy consolidation in usd terms and you can see how strongly sui like i mean this is a huge performance right right 5x in a few months but now let's look at sui btc look at that now this is a very different perspective and so sui is down really aggressively compared to bitcoin and also compared to other l1s okay so suey is clearly underperforming this is not something that you would easily see by looking into this chart but if you look at that then you see okay actually what is important is the game of rotation and the game of rotation and relative performance is telling me that suey has a buying opportunity here although it might not be apparent here Not financial advice, and I'm just telling you as an example, but these are some patterns that you might want to pay attention. On the other side, ICP, Internet Protocol, or Internet Computer, is the second worst performing. L1 token or asset or coin I should say of the month but here is also the third worst performing which means this is a clear trend of you know underperformance so I'm not interested into that I will not buy it this is not a buying opportunity to me again as a trend follower I'm talking but these are some of the things you might want to pay attention and the same for EGLD which also had some good month in Q4, I believe, but now it's not performing well. And for example, the same thing for EOS. EOS is here. It's here and it's consistently on the right side of the chart. And yeah, it's not something that I really am interested in. Aptos is not bad in EOS terms. And so yeah, this is kind of some of the things that you might want to have a look. This is a three-month performance. uh to give you a broader view um say sui icp interestingly had some good month but now it has not and the volumes as i said this is just to give you some idea but especially especially for l1s you you cannot really rely on that but for others tokens like narratives like and dex says etc is reliable uh and it might give you some ideas in terms of liquidity etc so you can see now the performance of this specific narrative across time since its inception or at least since the start of the date when it made sense to start the date. And so here you can see the L1 narrative in the bull market of 2017, the last month, or even in the first quarter of 2017 had absolutely amazing performance. The same thing in January in 2021 in the bull market, but interestingly in 2022 as well. And so you can see also some of the things that I like here is you can see the drawdowns on the worst month, you can compare them across different narratives, and also if we are having a bad month, for example, let's say you can compare to the historical or on your specific narrative that you are looking into, you can compare to the historical drawdowns and then compare and see if it's close to the worst. the lowest values it has ever had, then maybe it's a good buying opportunity. For example, here on L1, it's down minus 35%. Here, minus 33%, minus 38%, etc. So if at some point you have minus 30-something percent down on L1s, maybe it's a good buying opportunity. Of course, you have to pay attention to consecutive month, but just things to consider. And the same thing for the upside, if it's going like crazy up. maybe you want to take profits. Okay, so that was it. And then the same thing for all the narratives, the breakdown of what's happening. We don't want to, I mean, there is nothing to add here. So the same narratives over and over, you can just, and then with the, you know, with the specific tokens that they contain, and you can look at the, into the details. For example, just as a last example, I like GameFi. And I just by looking very in just in a few seconds, I can see all these downtrends. But I can see Gala maybe is performing well. YGG is performing well. I have yet to add some of the assets. But here I've added some of them which are not yet here. So I can see Immutable is performing well. Chromia is performing well. Gronin is one that I would like to add but is not yet here. So these are good performing ones and it can. give you idea again here you see imx you see chromia and imx both in the top three positions this month and also in january as well so they are having really good month if you look at immutable great uptrend if you look at ronin same thing and chromia as well finally okay so again you can see we had a strong performance in 2021. Now let's go finally to the final section which is the ecosystem breakdown. So we are lucky because all the charts are similar to what we saw previously on the narratives but now here the narratives are instead of being the narratives we are looking into the ecosystems and different blockchains that are supported on June. This is important because not all are supported on June or not all the assets I should say. more precisely are listed on tune So here, for example, what I've done is take native assets off on each chain, for example, native DEX, etc., that are not present on other chains. For example, obviously, Uniswap and AVA and Maker are on many chains, so they are not here. But for example, on Arbitrum, if you look at Arbitrum, things like GMX, I mean, GMX is on Avalanche, but things like RDNT, GNS, these are projects that are just on Arbitrum. And so yeah, here Grail, for example, is the main decks, native decks of Arbitrum. Pendel is now on more chains and the GambleFi project of VIN R is also mainly on Arbitrum. So this usually when there is an uptrend or as we say, season on any blockchain, like Solana season, Avalanche season, et cetera. the native tokens are the first ones to go to start going up because these are the best options so you would see that actually these are Dave so if it's Solana season then Solana native tokens will start like Jupiter etc they will start or bank from belonging to different narratives they will start to outperform go to the left side and all the things that we already discussed and for example it's interesting to observe that polygon is on the first position this month although it was consistently among the uh among the uh this like the worst performing uh ecosystems um in the last month so maybe there is a trend uh reversal now you might want to look into this kind of stuff if you're if you do ecosystem plays i recently added a new chart on this narrative dashboard which is this narrative leaderboard so let's actually go on into the real query so I can show you in more detail what this contains. So here we are actually showing the performance of the narratives over the last six months. So we are ranking all the narratives and then we are giving points based on their rank, positive points and negative points. So the five best performance of each month are getting points proportionally, positive points and then the worst. performing ones the five worst performing ones are getting negative points then we are adding all the points which gives us a last score for each of the narratives so here are the details we can quickly look at the code so the first the best performing narrative will get five points the second best performing narrative will get four points and so on and the fifth one will get one point Let's mention that we have 30 narratives in total, approximately. So, you know, these are good ones. And then, same thing for the negative ones. So, the worst narrative of the month will get minus 5 points. The second worst will get minus 4 points, and so on, until the fifth worst narrative, which will get minus 1 point. And then... For the last six months, as you can see, we will add all of these points. So we add all of the points. And then this gives us a point per narrative, but not all narratives. Only narratives that appeared in either the five best narratives of one of the last six months or the five worst. Otherwise, they will not appear here. That's why you don't see all of the narratives here. So. What does this tell us? I think for me this is very interesting, because it allows us to see what are the best performing narratives in the recent time, right? Because there is a lot of rotation with narratives, and what was relevant maybe one year ago is not relevant anymore. So first of all, there is this time component, so we are seeing the recent trends here. And second, Although there are some outliers and one narrative might perform well for a specific catalyst in a given month, this doesn't mean that this is a general global trend. I'm again using the DEX as an example, a Uniswap mechanism feed that happened last month. Because of that, the DEX narrative was among the best performing ones last month. most of the index tokens benefited from that, Uniswap, Sushiswap, etc. But if you look, if you zoom out and look at the last six months, let me actually zoom so you can see all the names here okay so here you can see that as i said i've tweeted about that but i don't trade dexes nor perpetuals because usually they do not perform well in terms of token after appreciation it's important to precise that because although these are really highly revenue generating established business models and and they are you know kind of profitable businesses protocols like GMX as a retail user or as an investor if you want to bet on the price appreciation of the token you need to understand actually and their upside potential and what we are seeing here is that these trends here these narratives here have not really performed well so I'm actually ignoring most of this with the exception of GameFi, so you need a bit of context to understand actually is this really some regular pattern or some short-term thing. I'm not ignoring GameFi, although it should be said that as we can see from the data, GameFi generally has not performed really well, although there has been some exceptions with infrastructure gaming tokens like Ronin, Immutable, etc. but now let's look at this part of the chart we can see clearly clearly you know some of the narratives that we know have performed really well uh identity with ens and word coin um i might need to actually change word coin to ai although it's i think it belongs more to identity anyways or ordinals had some good month um in q4 last year and also this month and they are performing well brc20 oracles so we saw pith from solana we saw chain link we saw ooma and api3 all of these tokens they performed well overall with the lrt and risk taking we saw a list c protocols like pendle benefiting from that and memes are performing really strongly in this month but also had good performances in october and december and L2s as one, you remember, Arbitrum, Optimism, Scale, Metis, as well as Stacks, STX, all of them had good performances. So to me, what this allows you to see is actually where should I put my focus. So I'm certainly ignoring all of these narratives. I never have traded in the recent time any of these. Again, there might be some exceptions. So I'm not ignoring NFTs in general, but I know that, you know, it's not their time yet. Although NFT is a big sector and some of them have performed well, like Puget Penguins, the same for GameFi, but anything here not actually really performing well. Well, recently Bitcoin narrative is promising. And then here is, I have most of my focus here in this. like top five six so and this is of course changing every month and depending on the performance and depending on what's going on as you can see from this chart here and as you can see from the history of um of narrative so we know here identity ai memes lsds identity ordinals l2 ordinals ordinals etc um This is one thing I strongly recommend to look at this every month, every other week and put your focus on what's trending, okay? We know that betting on strength is something that historically works really well in crypto. This is one thing. The other thing in kind of very practical advice that I wanted to share is Now, let's say that everything that I've said and all the analysis from all these charts and, you know, these charts and this chart, etc. Now you've decided that, for example, you want to focus on one or two narratives. What should you do? What steps should you take and how should you trade them? So let's, for example, take the AI like this month. We have the memes and the AI narrative. that are the best performing ones so let's go on and let's go we can talk about them briefly let's go on memes so we can put here um flow key okay which brings us here to the meme narrative so here are a few of them compared to um if as you can see a great performance here on shiv on flokey on bald even on doge etc so really performing strongly recently i've added a bunch of these let me open this so you can see better okay so now let's say you want to trade the meme narrative And these are some of your options. This is not an exhaustive list, especially for the meme narrative where we have thousands of them. But usually I put the strongest projects where there's ones with the highest market cap or liquidity there. And if there are new trending projects, I try to add them. So let's just for the purpose of this exercise, let's just focus on the list that we have here. Again, we mentioned that you have two ways of thinking about that either. you want to focus on you know the best performing ones or if you want to see if there is a maybe a pullback or something on these ones and um have that so this is a choice that you should make but and there are some now now that we want to narrow down and practically know how you can trade that let me give you a few advice few tips on how actually i use that personally so here starting with the left part we have this project which is a recent one um sheep flow key will go pepe so i of course uh sheep is a big one pepe is a big one uh probably one of the biggest and flow key as well so to me uh you again you can think in two ways into that do you want to go with more established projects who are probably safer options in terms of maybe rock pools and this kind of stuff and concentration in the big wallets. These are better in that regard. Or you prefer the smaller projects who have a smaller market cap and might have much higher volatility but can have more upside potential. This only depends on your risk appetite. I cannot give recommendations, but you should know that if you go into some of these projects, Some of these were newer, like Troll, you know, this is a recent one. Trump is a few months old. This one, Hemel, is pretty recent, I would say. These would have a lot more volatility. Bobo as well. So if you can't handle like 50% drawdowns in one week, which some of these might have, then you should avoid this. But if you prefer... to have exposure to this narrative and you know um you don't have appetite for that much volatility you can go with some of these options so let's go let's say that that's your risk profile and you want to you prefer to go with the peer projects and this is what i would do personally or you can mix you can create a portfolio like if you want to allocate let's say 10k to the memes you can say okay i will find I will pick five of these. I will create a meme portfolio for myself. And then you can go, then you can do combinations. For example, you can say, I will pick three like more established projects and then two like more risky projects. And then the weightings depend on your risk profile. Again, if you want to be more conservative, you would give more weight to the bigger projects or maybe because now there are three against two, you can just... go with equal weights, et cetera, et cetera. There are many combinations, and depending on your risk preferences, et cetera, or your conviction about, you know, maybe you do some research and you realize that actually, for example, Pepe has the strongest community in terms of whale distribution and wallets, et cetera, is a better one. And so these are some of the research that you have to do. to develop some conviction on each of them maybe you can score them on your own and come up with the scoring system based on different metrics like community like um everything you you want tokenomics etc etc i mean there are not a lot of metrics to talk about for memes but generally speaking you can come up with something for yourself and then um then you have a portfolio right you can say okay i will buy with my 10k i will buy 2k of SHIB, 2k of PEPPER, 2k of BOBO and 2k of Bitcoin and 2k of let's say ELAN. Okay and then then you have to go on the entry side and on the trigger side, which is not the subject of this conversation here, this video. But just to give you an example, this is Pepe, for example. And you need a strategy, right? To enter and to buy and to sell. Again, just for the sake of illustration, I will just take the moving averages because that's the simplest thing we can do. and you could say okay when there is a crossover here on whatever a number of moving average or exponential moving average you like you can buy and then when there is a crosstown you can sell on whatever time frame you like right so you have to come up with what you like and what you don't like um rsi etc and this is something that you have to decide but um then you have actually once you do that you will have a full system where you have a portfolio you have chosen your your tokens for a given narrative and then you have your entry and exit and you have your risk profile because you have defined the weighting of each of these etc etc let's also briefly talk about the ai example because i think it's a bit a better example compared to meme which is very limited in terms of fundamentals etc so ai so let's put ocean okay so here we are and so yes as you can see a very good performing narrative this month so again you have all of these options some of them have a higher market cap some have lower market cap so you can go on coin deco for example and if you put fat is the name so you can see already rank 49 market cap close to 3 billion so that's a pretty established project on the other side this one in q ai just 100 i mean not just but 112 million market cap and the rank much lower, this is ranked by market cap. So again, you can think in the same way, you can say, I will create a basket of three, four, five tokens, whatever you like. I recommend for each narrative to keep it between two to five, generally. And then you can say, okay, I will take, like, if you like four, then you can say, I take two bigger projects and two smaller projects because they have more upside potential. You can do some research on some of these protocols and understand what they do. Again, here it's easier because, you know, it's not just about community, they're actually trying to achieve something, right, in terms of AI. You can try to research them, what is it that they're trying to do, is it decentralized compute, is it GPU related, is it like some kind of AI services that they're doing, and you can try to... and actually build some conviction for yourself. So market cap is one consideration. The other consideration is what they're trying to do, their competitive edge, et cetera. This might be a good subject for another video. I do not go too deep into evaluating different projects right now because we're talking about narratives, but you choose your tokens as you like. You keep the weightings, and then you're able to go. You have, as we discussed, you have your, here, for example, Fed has been also performing really well. So you define your entries or exceeds where you want to eventually enter on a pullback or anything, and then you have exposure to this narrative. Or if you're a longer-term investor, you might not care about these moving averages and these technical analysis stuff. You just might want to allocate directly. With a long-term view, that's also a very good approach. And that's it. So that's how you trade a specific narrative once you have chosen your preferred narratives. Just to finalize on that and some tips, I would recommend generally to focus only on two to four narratives. Minimum two because you need diversification of narratives because narratives of a given... tokens of a given narrative are highly correlated. As you can see, for example, most of the AI narratives related tokens are performing well, and most of the memes now are also performing well independently of the meme. As you can see, they all have a good performance. So it's also good to think there might be a month where they will not perform really good, so you might want to allocate to two narratives or three or four, knowing that the less... narratives and tokens the easier and the more time you have to build conviction on them and to follow up with their development as well um so two narratives to four and then for each narrative two to four token again uh general just rule of thumb recommendations so that if you go with two narrative and two tokens you can have four tokens in general in your portfolio which is a good number if you have high condition and but if you go with for example four narratives and two tokens per narrative or three you would then have eight or twelve tokens i generally recommend having less than like 10 i think is a good number 10 or 12 um as different assets on your portfolio that gives you a very good diversification and and that's everything i wanted to cover in this video i really hope you enjoyed this in-depth tutorial narrative trading That's it for today. If you enjoyed this tutorial, please give it a like and subscribe to our channel. We're just getting started on YouTube. We've done already a number of interviews with tier one protocols, as you can see, like Pendel and Etherfly and Kelp and others. And there are more videos coming soon. Also, make sure to follow us on Twitter where we are much more active and regularly posting content about narratives and new trends. And from here, you can access our Dune dashboards and tutorials. As you can see, we have our narratives that are the most popular ones. Make sure to give a star to this dashboard that we discussed today so that you can easily access it from your favorites. And we have also other dashboards that you might want to see from CryptoSignal, Want to Buy and Sell, or Trading Names, or... the LRT protocol. And finally, make sure to check out our newsletter. We have a weekly newsletter where we are sharing the best trends on crypto, as well as our premium sub-stack newsletter where we are sharing all the alpha. See you soon.

How to make money trading crypto? I've received a lot of requests to explain my narrative dashboard and go over some of the charts. So here we are.

Let me first start with an introduction to narrative trading and then we will talk about the dashboard and the charts that it contains. Okay, so basically when you are trading you have a few elements, a few things that you have to figure out for yourself. First is what you want to buy, what kind of assets, then when you want to buy and then how much you want to buy. So the first thing for crypto could be just buying Bitcoin or alts or narrative trading.

For when you want to buy, it depends on your trading strategy. So you can use technical indicators like RSI, moving average, crossovers, etc. Or you could trade based on sentiments or an index like fear and index sentiments or funding rates, order books.

There are really a lot of different styles of trading. and it really depends on your preferences. Then you have to figure out how much you want to buy when you have an entry and an exit based on your strategy.

So this depends on your risk management and your risk profile. For the purpose of this video we will just talk about the first part which is what to buy as we are focused on narratives trading. So in crypto if you go on CoinMarketCap you would see that we have there are more than almost 10 000 tokens. just listed on coin market cap coin gecko and if you go on the screener you will see that it's much more more than 20k tokens that you can actually buy and sell on dexes and also centralized exchanges so with all these options what should you buy how should you build your portfolio okay let's now talk about our objective here as a narrative trader so it's important to think about what we're trying to achieve because we can always hold bitcoin and just do nothing as we said so our goal is to outperform the market and by the market we need to i mean we need to we need a benchmark which is usually a bitcoin or ethereum or stack ethereum but but for the sake of simplicity we will take bitcoin in this example so as a narrative trader what you're trying to do you're actively trying to find the best assets etc and in order to outperform the market so there are different ways of measuring this one is this cap and formula here and so let's just quickly look at what this is saying so this is alpha which is the excess return that you are generating from your portfolio and investments so here we have roi which is the return of the investment or if the risk-free rate which in crypto we don't really have risk-free rate but let's suppose that lending like stable coins on for example ave is our risk-free rate although it's not risk-free but it generates something uh let's say around five percent per year and then we have the bit beta which is uh we can think about it as the correlation of our investments to the market and the volatility and we have finally the re and the return of the market so what this is saying is in order to generate alpha or your your goal is to maximize this alpha so generate as much as alpha as you can how can you do that so we have a subtraction meaning that you want to have as large as number as possible here for ri and as little here as possible to maximize this alpha number so in a bull market environment um it's very important because it's important to know that you're not just trying to make money but you're trying to make more money than a benchmark which recently at least at the time of recording in march 24 bitcoin had has had a very strong performance in the last few months.

So not everybody has outperformed the market. And if you consistently underperform Bitcoin, then you should really ask your question, is it worth all the efforts that I'm doing? And you might be better holding Bitcoin. And it's for this reason that you should really understand. And especially in a bull market, it's maybe not difficult to make some money in USD terms, but are you actually doing better than you know ethereum or bitcoin etc if you're not you better just hold that so let's let's skip and give some numbers here so let's say if you're in a pool market environment and you've generated 50 per month or per year or whatever but just let's say per per year so 50 here and let's say that bitcoin has generated 100 returns and so this would be our m would be 100 our risk free rate we said is 95. So 100 minus 5, 95. For the sake of simplicity, we will take 1 as a beta correlated to the market, both positive.

So 100 minus 5, 95, we have our risk-free rate again here. So 95 plus 5, 100. And we said our returns are 50. So 50 minus 100 is minus 50, which is actually you have underperformed the market. So we have a negative alpha. There is no excess return. So although you made money and you had 50% return, you underperformed the market.

And so this is important to really understand this concept. deeply and it's because of this reason as we will see in the in my dashboard i'm using btc or ethereum as benchmark for all the narratives and all the um assets that i'm that i'm actually following is exactly because of that because you want to outperform the market so let's talk about few examples here to better illustrate what i mean by outperforming the market and narrative trading So here we are seeing a curve CRV which is one of the very established DeFi protocols and we are seeing its performance against Bitcoin since 2021. And you can see that actually from the peak of the bull market near December 21 it has been a very steady downtrend. Even until today, in the last few months, the market has been pretty bullish. But if you look at the Bitcoin pair of curve, you would see that it's still going down. And it's down 93-94% from the top.

If you look at another example, here we are seeing Cardano, ADA Cardano, again, performance against Bitcoin. And you also see that since August 2021, it's in a downtrend and it's down near 87%. Um. and so this is this means that actually you would be better holding bitcoin rather than holding these assets that i've shown here and if you look at another example here ethereum against bitcoin even ethereum so we know that historically um bitcoin outperforms ethereum in a bear market that's the pattern you're seeing here and here and here here and so but there was a catalyst during d5 summer in 2020 and the part of the bull market where everything started to flourish on DeFi, NFTs, all the different protocols and so that's where Ethereum started to outperform Bitcoin strongly during that period. And also during this period, as you see, during this short period in 2022 from May until September, what happened there, Ethereum transition to proof of stake.

And so this created a new catalyst for Ethereum to outperform Bitcoin, which was by the rumor, a selenious kind of event. And even in the last month with Ethereum going from 1,000 to now more than 3,000, you can see that compared to Bitcoin, Ethereum has underperformed. We know that because Bitcoin ETFs have actually been a strong catalyst for Bitcoin. So here, we are mentioning the catalyst that actually can have a very important consequence on the performance of trades of different tokens. Now let's talk about narratives.

In 2021, we had the L1 narrative, which was one of the best performing narratives back then. We had Solunavax with Sol, Solana, Luna, and Avax, which all had a great performance during the bull market before the crash of Luna. But during that period, as you can see, again, we are seeing the performance of these assets against Bitcoin and you can see how they really outperformed Bitcoin during that period. And so if you were a narrative trader back then, then you probably had exposure to these L1 assets.

And these were some of the best. There were others like Fantom, etc. but you get the idea actually we are seeing strong outperformance of the market during that period on these l1 assets layer ones another one was actually a gamefly gaming assets during the same period of the bull market where tokens like axie infinity or sandbox or gala etc they all also performed really strongly and and this is another scenario of narrative trading where a specific sector um crypto assets have actually outperformed Bitcoin in a very strong way. So this is the power of narrative trading.

So there exists a lot of different narratives now more than 30 I've listed on my on my Doom dashboard. I have a thread about that you can see the different assets for different narratives but very briefly we have obviously everything related to infrastructure. uh layer ones layer twos oracles we have nfts we have ai we have privacy real world assets uh dpn and memes etc etc there are many of them and so this is a good introduction to go on the dashboard and start So I would basically want to explain how I'm using this dashboard myself, and how I use it to understand past trends, and how I use it to inform my decisions for the trades and investments that I want to make.

So I'm going to share all these links here, so don't worry about that. This dashboard has a lot of things, so let's actually break it down. It actually has three main parts, an overview of the different narratives, and the state of the market, then a breakdown of each of the narratives with details about the specific assets that constitute that narrative and how they're performing relative to each other, etc.

And then there is an ecosystem section which compares different blockchains together. So how is, for example, Solana performing against Avalanche and Polygon, etc., in terms of the assets, the native assets on those blockchains? So let's start with the first section.

So I would say this first chart is probably the most important chart on this dashboard. I mean in the sense that it has information that is really useful for training and I personally use this one a lot. So what is this showing? So this is showing the performance of each of these narratives from the start of the month to a day. So today we are the last day of February and so we are seeing actually a full representation of the entire month of all narratives.

So let me actually open that so that we can see better here and let me zoom out. Okay, so here we are seeing the performance of all the narratives. We have the identity narrative as I've called.

By the way, you have the code and the details of everything so you can actually go and look at the details on how this is done and what are the different assets of each of the narratives etc etc but identity narrative has been the strongest performing one i don't want to enter it here in this video into the details of talking right now what's hot and why is this and the best performing narrative and what should you invest into because it's not the purpose of this video i just want to make an educational video about how i use this um this dashboard But I would use some of these as example to how you can think about narratives and how you can use them and trade them and see actually patterns. So for example, identity has a few assets that I've listed as index of the identity narrative, which is a word coin and then Ethereum name service, ENS, word coin is WLD, and the last one is identities is another actually identity related project. So what happened here this month was that OpenAI released their Sora video generation text-to-video service and this because the CEO is the CEO and the CEO of OpenAI, Sam Altman is also the CEO of WorldCoin, then there was a surge in the price of WorldCoin and then this is why you're seeing a strong performance here for this identity. so WorldCoin is the main contributor to the performance you are seeing here. So why is this?

Specifically, this is a good example, because personally, I wouldn't pay too much attention to this one right now if I wanted to just take some action based on this chart, because I know that that was just a news thing and there is no long-term momentum into this specific narrative. That's my opinion, by the way. others might not think the same but for me that's i just see it as a you know this sora release that affected the price of word coin but it's not as if all the identity projects are now proper and outperforming etc so this was uh if you remember the actually here i mentioned two things we have narratives and catalysts okay so catalysts are usually short time short term based on an announcement or something and so Here, I'm seeing this as a short-term catalyst, but I don't see it as a long-term potential thing for the entire identity narrative.

So here, I'm ignoring this narrative, and I don't care about this outperformance, and I just accept that I missed this opportunity. And now, moving to the next ones, and what can I see here? So memes have been performing strongly from, you know, Pepe and Bitcoin.

and other meme coins, they have had a strong performance this month, which is usually an indication of the market going on risk-on mode. So if memes is something you like and you're seeing this, then it means that... there might be opportunities in this sector. And by the way, let me say one thing of actually how you can use this is basically the idea is that either you are a trend follower and so you see these performances, outperformances, and then you think, okay, then I think that there is something behind there and I think there will be continuation in the future. So I'm seeing this outperformance on memes.

So actually I want to focus on memes for the next week's month. and just trade memes okay this is one way of thinking about that and the other way is you are more into mean reversion meaning that you see what is not really performing well maybe it's actually and ranging accumulating and so he you would look at this region here on the right side and so here for example something interesting to me would be nfts which have not had a great performance this month relative to others as at least that measured as measured by by the index that i have here so if you're into nfts you might think okay actually the market is in general going up but nfts are not yet outperforming so maybe there are some cheap opportunities some cheap nfts that i could buy and and just hold waiting for nfts to wake up and start outperforming so these are just two approaches that you could have either look at the right side and look what you like here among these narratives and what you think is kind of um undervalued and might go higher in price for example uh stuff like that have good fundamentals like oracles d5 2.0 lst protocols etc etc could be opportun could have some opportunities and on the other side if you're a trend follower you can just look at what is here okay on the left side and then decide Okay, I see that, for example, AI, the AI narrative has had a very strong outperformance, not only this month, but actually in the last few months consecutively. And so you could see that two months ago already and then decide to, okay, I think that there is something behind that.

It's not just a short-term catalyst. I see this as a long-term opportunity. And then you could go and research deeply.

this narrative and the tokens and the projects associated to it and then focus and adjust your investment accordingly. So this is generally how I look at that. Usually another thing that is important is usually I do not recommend to just look at this chart once per month or something like that because the moment you will start to see the patterns and the small patterns when you look at this very regularly because for example bitcoin narrative for example let's talk about bitcoin narrative this wasn't among the best performance performers in the last few months it's a recent thing so if you were paying attention before and if you look looked at this chart regularly you would know that bitcoin is usually around this part of this chart you know not among the best performance and so if then you regularly check you would see that okay actually bitcoin is starting to move to the left side so and and it's subtle right so if you look at the numbers here 29 30 31 33 it's not that if you just look at the picture you wouldn't get too much information you know on one snapshot but if you if you look at it regularly and you always know that for example bitcoin narrative is always in this region and now actually is outperforming the the other narratives and moving to the left, then this is something that could indicate the start of a new trend that you might want to pay attention and you might want to research more closely. Okay, so these are a few of the important things I wanted to mention about this chart. Other charts are, I will mention other charts, but I think it's important to go deeper on this specific chart because it's very important.

One other thing I wanted to mention is that Again, if you look at this for a long time, you would realize that some of these narratives are always on the right side of the chart. They do very rarely cross this region. And so these might be the ones that you do not want to pay attention. Or if you have tokens there, you might want to rotate to other narratives that are trending.

Or you might want to define your own rules or triggers. that'll like okay if for example i like nfts but but i would wait until i see them somewhere in this ranking to start paying attention again or to start allocating it again to the NFT narrative. This is some of the things you can do looking at this chart.

On the other side, you could also do the same thing on the left side, meaning that if the AI... So as I mentioned, the AI narrative has been outperforming for quite a long time now, but at some point this will stop, right? So at some point, the AI narrative will start to move to the right side. I don't know when it's going to happen. And as I said, I don't want to focus too much on which narrative is the best, et cetera, right here.

I'm just talking about trends and things that you can see on this chart. But at some point, some of these narratives, they will move to the right. And so again, you might want to define your own set of triggers to say, okay, if I'm into AI, but I start to see this moving actually to the right side at some point. and then some of these moving to the left side, then I might decide to rotate accordingly based on your preferences.

Okay. So just some general observation I can also share is that some of the, for example, some of the established projects like money markets, like things like AVA, et cetera, these kinds of lending and borrowing protocols, these are generally not outperforming in the sense of, yeah, outperforming the other tokens that we can see here. And this is a very consistent behavior.

It's not just this month, it's like every single month they are on the right side of the chart. So this is, for example, very easy to see on the wallet tokens, you know, things like Trust Wallet, TWT or Coin98 or these kind of tokens. It's also true for options, you know, that they have been underperforming. It has been true for privacy tokens.

It has been true for derivatives and perps, things like GMX, DYDX, et cetera, et cetera. And so I've shared recently a tweet about why I'm no longer actually holding or trading any kind of derivatives tokens. The reason is exactly because I've spent a lot of time looking at this chart.

And I've been able to see that the market is going up. And I've been able to see that the market So if as an investor, what you're looking into, or as a trader, you care about the outperformance and the token appreciation of what you're holding, then you should actually spend a lot of time here because, for example, GMX is a great protocol, is a great business. They have a lot of revenue, some of the best among the DeFi protocols. They are very established. They have a very high volume.

And they are building, they built GMX V2, they are building their app chain now, a new announcement. But ultimately, so it's a great business. If you're a fundamental, like kind of Warren Buffett kind of investor, GMX is a good token to hold. However, if you're a narrative trader like me, and you look at these charts and you look at what is outperforming, you would know that. No matter what happens and what kind of announcements in the derivative sector, usually they do not go to the left side of this chart.

And this is true for many of the narratives here. The same thing for DEXs. For example, I mentioned again, I tweeted about that recently.

There was this Uniswap fee mechanism proposal. And so Uni jumped 80% in February. But... But still, even with that, you can see that DEXs in general, not just Uniswap, but SushiSwap, PancakeSwap, Curve, Camblo, Grid, and others in general, although the performance is not too bad, is more on the left side, but still is not among the top five, top six.

So that's why I also ignore these kind of tokens. This is yet another kind of pattern that you can observe if you look at this for long enough. And then last thing I would want to mention, and this is becoming a bit too long on this chart, but I think it's worth it because I think these are some interesting patterns to observe. And so last thing is there is always rotation, right? So the first, it happens rarely that for consecutive months, the first narrative identity here will be also the first next month and the month after, etc.

So. There is a lot of movement in this chart, although there are patterns, there are clear patterns as I mentioned before. Some are, statistically speaking, some are more on the left side, some are more on the right side, and some are just kind of...

actually too much correlated to the market. So if you remember the beta that I mentioned in the introduction, they have just a high beta to the market or to Bitcoin and so there is no kind of strong outperformance of the market. Okay, so with that being said, let's go back to the dashboard. So here you can see the performance of all the tokens. There are now close to 200 tokens.

narrative tokens that I track on my dashboard. And their monthly performance MTD and on average, like median as it's written. So in February, actually narrative related tokens are up 31%. And from the start of the year, they're up 25%, meaning that January, we went down on average around 6% or so.

So this is important because you can use that as a benchmark for your own performance and seeing how much did you outperform that. So this is a median. So if you're a native trader, you could use that as a median.

It could be a measure or you could use just the performance of Bitcoin or Ethereum or staked Ethereum as a benchmark. But it could be an indication. OK, so here in this section, we are talking.

talking about trend reversals, meaning that tokens, as it's written here, these are narratives that were mostly on the right side, but now are all of a sudden in the last two, three months moving to the left side. And so, for example, identity is one of them. And because there was this catalyst, this news and news related thing that I mentioned. So an identity, the identity narrative was not always here okay ai also although um it was mostly on the left side but not always on the third place and also the bitcoin narrative right the bitcoin narrative is having a great time and um i am very bullish on it but i said as i said i let's not talk about the specifics of narratives so now here you are seeing the performance from the start of the year which will give you a broader picture of what's happening you So one thing to know is that these are MTD and YTD, meaning that they will reset here. They will reset at the start of every month.

And so tomorrow is the start of March. And so everything will reset to zero. And then, you know, so for example, on tomorrow or in the next three or four days, you might not see a lot of signal just looking into this because things are still developing.

So that's why I think having YTD is important. And also. zooming out and also there is some kind of alpha comparing these two okay so for example if some narratives are here on the right end side of the things of this chart here and on the monthly they are on the left side then it means that overall across that year they underperformed but underperformed but now they are actually outperforming This happened with NFTs in November, and it's a pattern that I mentioned. NFTs were the least, the worst performing narrative of the year in 2023. So they were here. But in November, at some point, they were the first.

OK, that's where Puget Penguins, they started to trend really strongly. And so that was, for me, an indication of, OK, now NFTs are waking up. And it was a clear sign.

And actually, that's... was kind of the bottom for NFTs. And from there, they have been trending up in USC terms. However, they are, at least in February, they were not among the best performance. So comparing these two charts is also interesting.

And for example, now we are just coming to an end of February, the second month of the year, you can see that Identity and AI, they are still actually, even in January, they had a great performance. It should be said that ENS, Ethereum Name Service, had a great run in January. And so it's also contributed to that, as well as the Space ID, which is the other token in that category.

And the same thing holds true for AI narratives. A narrative with very trendy tokens like R&DR and TAO and FET, FET, FETCH, etc., etc. So...

yeah, these are some of the patterns here. Then you can see the risk adjusted returns. From 2023, this can be mentioned about the beta and the volatility.

And so, for example, it's pretty common to see memes, although they outperform here, for example, and they are second, but they have a lot of volatility and sometimes they go down 80%, 90% in a month or in weeks. So they have a lot of volatility, which means if you measure the risk-adjusted returns, they are not among the best. narratives of course and then you can see for example here lsd l2 projects like pendel and defy 2.0 and bitcoin narrative being among the best interestingly money markets rarely outperform in terms of dollar terms but because they have lower volatility they are actually they have good risk adjusted returns so for more conservative investors and traders they might want to look into this.

Okay, so we have the volume. You have to be careful here, because we don't have everything on DEXs and all the activities, so just be careful when you look at that. But it could give an indication for some narratives, and if you want to know where there is liquidity, for example here, sometimes it's interesting because, for example, DeSci decentralized science was one of the best performing narratives in Q4. but it's all just very small cap projects. So you would see them here in the first position, but actually when you look at the volumes, it's almost nothing.

So there isn't a lot of liquidity in these projects, which if you're an investor who wants to put size, then this might be a consideration for you. Because we said that these things reset at the start of the month, then, and also to give a broader picture, there is also a three month performance here. this is working progress because i have to add the other narratives but you can already see here there are some already good patterns l2s and l1s and ai have been performing well now um we come to the news to this section where we are actually now talking about tokens and what what tokens are performing better so this is and these are again all narrative based um tokens and so here you can see the projects that are close to their all-time high. I will go a bit faster here because it's pretty obvious what it is, but still I will just mention maybe why it's important and how you can use it. So usually the idea is that trend following is a strategy that works really well in crypto.

And so it's the easier version, I would say, compared to mini version. And longing strength is something that you should do, especially in a bull market environment. Let's see what is in a...

close to all-time high region or in an all-time high region and then actually just um just during price discovery zone and so and there is highly it's highly likely that they continue to go higher so if we go on a trading view for example and we take we check fat if you go on two weeks you can see that here is already in all-time high region okay and so this is a bullish one if you look at stx the Bitcoin layer 2, you can see that it's close to its all-time high. If you look at Injective, same thing. So if we mentioned that there are like thousands of tokens, etc., these actually are giving you clues on what you should buy or what you should hold.

And these are all very valid options that I think are very strong, you know, as you can see from the price action. And so you should actually look then into what kind of narratives they belong in. into and what are your preferences and how well you understand them and then actually just trade or invest accordingly.

Then if you're into mean reversion you might want to look into that which is how far the top 15 narrative tokens that are the furthest away from their all-time high. Although I don't really suggest this strategy because it really works but still for example just looking into the names These don't look very attractive to me. Things like EOS or what can I say?

ICP. Let's look at ICP. So as you can see, this went down. I mean, it almost went to zero. And now, of course, it bounced.

But still, it's very far from its all-time high, right? But the reasoning of I should buy this because in the bull market and this will go back to the all-time high is questionable because this rarely happens right so i really doubt that icp will make it i mean let's not again talk about specific projects etc but you should ask yourself if if the projects will really come back if they have a strong community etc same thing with cardano Of course, it's very far from its all-time high, maybe not that much compared to others, but still, you might want to look into this. And some of these projects, again, also, there are.

Yeah, so, of course, in theory, when you look into the chart, there is an upside potential. But then, because the attention is mostly on, you know, the trending stuff and the new stuff and what is... and this is what everybody is talking about so how likely is is that these ones start go back to their all-time highs i'm not sure but sometimes there are some good projects here for example axi you might argue that axi is a good project and it might come back in a bull market environment with new participants and so you might think that actually i like gamefly you can actually then go deeper into unchained data and see okay you can go and run in and then look at the activity on chain and look at some dashboards. Is it having an income of new users?

Is the number of transactions going up? Is the community strong on social media? All this kind of stuff. You can then take your decision.

And interestingly, Filecoin, which is a promising project, especially with the announcement that they made now recently, collaboration with Solana, etc. you might think okay actually i like this one file coin and so so yeah this is for a mean reversion trader or investor you can look at this you can combine these these are all preference-based stuff you know you can actually build a portfolio where you buy a few of these and a few of these based on your preferences etc okay let's move on top top 10 performing assets okay so these are the best performing assets of the month uh so we can see here there is a lot of um like ai related stuff like chain gpt like fetch like uh ajx like word coin uh we might argue that it's not ai but uh probably it's because of ai that it's pumped and as well as this one so um this is the best performing asset of the month among 200 assets you might want to look into this you might want to look into this generally and see okay actually the best performing assets of the month are mostly ai related stuff so maybe i should really have a look into all the ai stuff maybe it's really trending and so in general among the 200 assets the average performance this month was 38 and so this is very strong performance you can see here and then the same thing for your start of the year you can see almost some of them are here but for example pendel had a great performance as well as ethereum name service and tao and sui and chromium the game fire project these had better performance in january and so they are not here in the list okay and by the deep opportunity so again similarly this is for trend followers going long and if you're a mean reversion you might want to look at these ones and so these are the worst performing so this gamble fight project let me change the time frame this is a new listing yeah so this gamble fire product is down i'm not probably better to look here yeah so it's down 15 to 20 percent or something so um again if you're into mini version or for example this is interesting this is a very promising project, TIA, P-Tensor, AI-related. This is Frax. Frax has a lot of catalysts. And it's here. It didn't have a great month.

But if you like, again, kind of Warren Buffett kind of style of trading, you might see that, okay, there is a lot of bullish catalysts on Frax. And then you might want to see that as a good buying opportunity. role bit as well and then here again the same thing for the year. Pepe has a deep apparently GLD etc. Okay so now we have defined a narrative which is just an index actually that usually constitutes of few tokens and then I have taken an equal weight average and so we can plot the performance of these across time and then have this actually things that look very noisy, but you can actually filter out these things and then actually you can see what's interesting to you.

So for example, if I like L1s or L2s and GameFi, I can let those and then I can then see how has been the performance of these things compared to each other. So you can see that there is a general trend in the market, at least among these narratives. but we know that's the case in so far 24 has been a good year but yeah not a very obvious kind of pattern here they all kind of mostly follow the same trends but yeah GameFi has been maybe has catched up to some of these narratives so this is interesting so this is a pattern that I can see here for example it allows you to have a broader perspective across time.

Here is last three months and here is since 2016. And there are very interesting patterns to see here. For example, if you want to study that at some time, at your convenience, we mentioned about the layer one narrative in 2021 and the memes. These are things that you can clearly see. You can see actually this also allows you to see patterns of how long a narrative can last, how long historically, like the best performing narratives for how long they outperform, what happens next.

You see this kind of, you know, up and down kind of things. It might allow you to time better your entries and exits and all this kind of stuff. So I think this is some interesting information here. Then we can see here the average performance of different narratives across time. So there is an outlier here, I think it's a decentralized finance, which had such a small market cap that is now not allowing us to properly see the other things.

I should cap that. But anyways, you can see actually the performance of Bitcoin here, for example, 2022 January minus 16, the average performance of narrative. So and also the maximum performance of the best performing narrative.

So again. this can give you some indication of when Bitcoin is outperforming, when narratives are outperforming and see trends. Here is, I like that a lot, it's history of narratives and it tells you the three best performing narratives and worst performing narratives of each month.

And so for example, you should ignore the first row because for now at least you need to wait for the month to close for this to be relevant but that was a small note let's search for example bitcoin and so bitcoin narrative which is bitcoin itself and stacks stx and other related tokens have had a great performance in 23 actually there were at some point two times they were the best performing narrative and that's when bitcoin etf news actually came here and so they were the best performing narrative and although the average narrative on average narratives were down uh around minus mine minus four percent the bitcoin narrative was up 64 percent here and uh 74 percent here and you can also see uh okay at some point it was third uh you can actually filter that by date and uh in the last month i mean yeah in the last month it hasn't been among the top three and you can also see when it was among the least best performing ones so here in 2021 um it was not it didn't perform well the bitcoin narrative etc if we look at um other narratives for example ai there are a lot of lines so ai is either uh many times has appeared as the best performing narratives or as the worst performing but you can see has been among the best ones. If you filter by date, yeah, you can see here AI. And so, for example, this was, I think, when ChatGPT almost came, the first version, that was the start of the AI narrative boom, and et cetera, et cetera. You can also check NFTs. Last example.

So NFTs, we know that they did really well in 2021 in the bull market. So you can see them many times as the best performing narratives here, especially in June 21. It was a bearish month for entire crypto, but NFTs were exploding. Interesting observations here. as well in july etc and then in 22 they had a really bad year so you can see many many times they were appearing here among the you know consecutively the nfts were among the worst performing actually where the um where the nfts was the worst performing narrative of the month for many months in 2023 and also you can see the ranking of you know the average overall average returns So for example, so far, the best month overall has been May 2023. Again, you have to be careful because, yeah, this is because of decentralized science, which has kind of skewed everything. But if we ignore that one, then there are some interesting observations.

For example, we know that the first month of last year was bullish. And so it was one of the most bullish across all times. And we also know that we had the...

bull market in 21 so in october it was one of the best month again interestingly memes were among the best performers etc etc and you can see the worst performing month uh that was obviously obviously in the bear market of 2022 remember that very well in may in june uh in november okay and in november because for example just a random thing that i just saw november what happened ftx went bankrupt and so there was a lot of fear and everybody was actually withdrawing from centralized exchanges and so look what is here the best performing narrative of the month is wallets because people started to actually withdraw their money from binance from ftx from everything and they started to put them into things like uh trust wallet and safeball and coin 98 and so the month the market was down 16 overall that month at least on the narrative assets but the wallet narrative was one of the few times that it was actually among the best ones but here it was the best one so and as you can see the second best performing one was perps maybe because there were a lot of liquidations i don't know and some of them they do they share that revenue but in any case you can see that there is a big difference here 20 20 21 percent 6% and the third best performing one was NFTs which is usually uncorrelated to crypto markets and even that one was negative and if you look at here the worst performing ones we can see that really we have some bearish numbers. Okay so then you can see there is seasonality in crypto that's important and so again there is some outlier here but so if I remove that you can see some patterns that are interesting here for example we know that um Q1 and Q4 are generally bullish quarters in crypto. And Q3, we always know that it's really not really that bullish, especially September, as you can see.

And so these are some of the things that you might want to consider as a general framework. And you can actually integrate that as one of the metrics of your considerations for your risk management or for how much you want to have in stables, etc. If historically since 2017, June, or September or August have been bearish month, you might want to consider that or not. And then if historically April and Q1 and Q4 have been bullish, then this is something you might want to look.

Okay, so now large caps, narratives and large caps. So it's important to know the difference in performance of Bitcoin, because as we said, you're putting time and effort into that. to trying to outperform bitcoin right because you can just easily just hold bitcoin and do nothing as many people do but if you're putting your time and effort you want to outperform holding bitcoin right so what assets are outperforming bitcoin why is why is important to trade narratives in my opinion for example you can see here already top five top ten top 50 20 30 all of them are underperforming holding bitcoin okay that's a big thing so if you if you hold all of these you know you hold all of these you hold all of these etc you would underperform just holding bitcoin so that's a lot because you pay in gas fees there are more risks maybe with some of them um and there is a lot more effort to manage your portfolio um risk adjusted returns are will be worse but you're still underperforming bitcoin So what's the point of doing that? However, if you look at the performance of top three narratives, then...

you can see a clear difference okay this is top three it changes every time these these usually do not change that much but still there is a big difference right at least 2x difference more than 2x so there is merit into looking into narratives and as we said if you stare for long enough into these charts i promise you that it's not that hard to eliminate some of the least interesting things like as i said wallets money markets and some of these you can options gamble fi i mean it's it's uh it depends on what you like etc but uh you will at some point see consistently some patterns and so it will not be that hard to uh also considering the assets etc to find some real alpha here and focus your attention on what's trending and what's going up okay so uh again here if you're a more conservative trader you might want to say i just want to limit myself to top 20 assets by market cap because they are more established, they have less volatility, I'm more comfortable with that. Okay. Then you can see again, uni, for example, that was a catalyst of a fee mechanism switch.

It had a great month. And now it's your job to see, okay, is that a short-term thing or can this be sustained? And is this a big change? Again, I have my opinions, but I don't want to enter on these topics right now. So these are some of the things you might want.

What's happening with Filecoin? Why is it outperforming? Doge has been performing well.

SHIB and Doge, we said that meme coins are performing well this month. So in terms of rotation, we also know that when meme coins start to outperform, maybe it's the end of a rally. So again, these are all different things that you can consider and all the things that you have on your brain model or investment model.

So a top 50 assets, I think for me, that one is a bit more interesting than these ones. There is more happening. So layer two, Bitcoin layer two, a uni, a graph, a file coin, R&DR, et cetera, et cetera.

IMX, the gaming protocol. Some of these, yeah, I'm surprised to see. Again, for example, HBAR. I don't know the catalyst, but I don't.

pay too much attention to that, at least this is a one-timer thing for me. If I see it maybe next month, I would pay more attention. But for example, IMX, of course, I'm paying attention.

Again, I'm sharing these examples not because of the project itself, but just to give you an idea of how we can think about this. IMX has been performing well, not just this month, but in many months, in the last month. It belongs to the GameFi narrative, which I believe is strong.

the same for rndr the same for stx so when i see these things it actually reinforces my beliefs and my biases for you know holding them etc and so you might want to look at your stuff and your preferences and then decide accordingly okay so now we come to the second part of the dashboard which is a narratives breakdown so um Here we are breaking down all the assets that constitute this narrative and we are seeing their performance relative to a benchmark. This benchmark is always Ethereum except for the L1 narrative where I thought it doesn't make sense to compare them. I mean, it might make sense, but I didn't use Ethereum as a benchmark.

I used Bitcoin. So, yeah, let's focus here. So here you can see actually the performance of.

all these L1s, it's not an exhaustive list but it's good enough. And so you actually first, at first glance you can see, so as we said, you want to make money, this is one thing in USD terms, but you also want to outperform the market, that's why you're seeing the BTC pair here. And so here, for example, just looking at this more closely, you can see for example, CAVA, just a downtrend. although if you look at kava in usc terms maybe it's going up but it's underperforming kava so i'm not interested eos the same thing but on the other hand xrp the same thing trx the same thing telegram turn coin same thing but on the other hand the i'm seeing some strong uptrends like sui like say like solana etc so these are some of the things and of course and gno right gnosis some of the things that I might want to pay attention to, or you might want to pay attention.

Now here again, we already discussed in detail these charts, so I'm not going to do it again, but as I said, I don't want to enter into the details of what assets are good or not, but if you're into L1 narrative, okay for example which i i like l1 narrative i think it's good to have exposure to some infra project narratives like l1s l2s um you might want to have a deeper look into this narrative you know for example you can search l1 on the dashboard it will bring you here and then you can see okay i like l1 narrative which token should i buy should i buy bmb should i buy xrp and so you can see the monthly performance ytd performance more importantly you can see the performance you against bitcoin now here we have a very interesting pattern here i believe we are seeing all these almost everything is up in usd terms and uh however almost everything except few ones are down in btc terms meaning that bitcoin is outperforming outperforming all of these guys so let's look at let's look at an example bnb is up this month uh yeah it's up what something like 30 percent but if you look at bnb btc then it's it's down right it's down it's down like five percent or so so you can see here it's up like 36 percent and uh it should be somewhere here it's down like five percent okay here so um again our performance is what you're uh what you're interested so for me i would look at this part at the left side and see what's interesting Gnosis is again, this is a pattern that is not just this month. And that's why again, I want to emphasize on that. If you just look at this, you wouldn't know that Gnosis is very actually strongly trending because this has been a consistent pattern across the last month. Okay. Gnosis is outperforming Bitcoin.

Ethereum for the first time after a long time is outperforming Bitcoin. Again, I know that because I look at these charts every day and I know everything here. So Ethereum has been underperforming Bitcoin for many, many months. But for the first time, although at least until four hours ago, although Bitcoin had a very strong month, Ethereum is outperforming it by just a little bit.

So still, this is a pattern for me. I don't care about that number. I mean, I also care, but I care about that. But I also care about the position of the assets that I like. If I like Ethereum and Ethereum was always in that region, then now it's here.

So it might indicate that now the trend has changed and it's time to pay attention to Ethereum, maybe. Again, okay, so this was MTD. Now, here is what I really like, these kind of patterns. Look at this, just a good coincidence.

So SUI, new generation L1, is the worst performing of the month compared to Bitcoina, okay? And it's the best one in the year. okay so meaning that it had a great month in january but now it is there has been a pullback so for me if i believe that new generation l1s or specifically sui is an interesting project then i see this as a very clear opportunity and i don't even need to look at the charts because this is telling me everything i need so we had a great month last month and sui is now down maybe people took some profits and so this is already a buying opportunity maybe for me or at least a dca opportunity or scaling in opportunity and i don't even need to look at anything else uh if i like if i've already done my homework and i know that project and i know uh how they are doing and i follow them on social media etc etc i can just go and buy sweet for uh again i'm talking about this as just an as exam as an example okay but let's look at sui so sui in usc terms it's not that bad right in usd terms when you look at that chart it's not i mean that parabolic thing has broken but it's it has been a really healthy consolidation in usd terms and you can see how strongly sui like i mean this is a huge performance right right 5x in a few months but now let's look at sui btc look at that now this is a very different perspective and so sui is down really aggressively compared to bitcoin and also compared to other l1s okay so suey is clearly underperforming this is not something that you would easily see by looking into this chart but if you look at that then you see okay actually what is important is the game of rotation and the game of rotation and relative performance is telling me that suey has a buying opportunity here although it might not be apparent here Not financial advice, and I'm just telling you as an example, but these are some patterns that you might want to pay attention.

On the other side, ICP, Internet Protocol, or Internet Computer, is the second worst performing. L1 token or asset or coin I should say of the month but here is also the third worst performing which means this is a clear trend of you know underperformance so I'm not interested into that I will not buy it this is not a buying opportunity to me again as a trend follower I'm talking but these are some of the things you might want to pay attention and the same for EGLD which also had some good month in Q4, I believe, but now it's not performing well. And for example, the same thing for EOS.

EOS is here. It's here and it's consistently on the right side of the chart. And yeah, it's not something that I really am interested in.

Aptos is not bad in EOS terms. And so yeah, this is kind of some of the things that you might want to have a look. This is a three-month performance.

uh to give you a broader view um say sui icp interestingly had some good month but now it has not and the volumes as i said this is just to give you some idea but especially especially for l1s you you cannot really rely on that but for others tokens like narratives like and dex says etc is reliable uh and it might give you some ideas in terms of liquidity etc so you can see now the performance of this specific narrative across time since its inception or at least since the start of the date when it made sense to start the date. And so here you can see the L1 narrative in the bull market of 2017, the last month, or even in the first quarter of 2017 had absolutely amazing performance. The same thing in January in 2021 in the bull market, but interestingly in 2022 as well. And so you can see also some of the things that I like here is you can see the drawdowns on the worst month, you can compare them across different narratives, and also if we are having a bad month, for example, let's say you can compare to the historical or on your specific narrative that you are looking into, you can compare to the historical drawdowns and then compare and see if it's close to the worst.

the lowest values it has ever had, then maybe it's a good buying opportunity. For example, here on L1, it's down minus 35%. Here, minus 33%, minus 38%, etc.

So if at some point you have minus 30-something percent down on L1s, maybe it's a good buying opportunity. Of course, you have to pay attention to consecutive month, but just things to consider. And the same thing for the upside, if it's going like crazy up. maybe you want to take profits. Okay, so that was it.

And then the same thing for all the narratives, the breakdown of what's happening. We don't want to, I mean, there is nothing to add here. So the same narratives over and over, you can just, and then with the, you know, with the specific tokens that they contain, and you can look at the, into the details.

For example, just as a last example, I like GameFi. And I just by looking very in just in a few seconds, I can see all these downtrends. But I can see Gala maybe is performing well. YGG is performing well.

I have yet to add some of the assets. But here I've added some of them which are not yet here. So I can see Immutable is performing well.

Chromia is performing well. Gronin is one that I would like to add but is not yet here. So these are good performing ones and it can.

give you idea again here you see imx you see chromia and imx both in the top three positions this month and also in january as well so they are having really good month if you look at immutable great uptrend if you look at ronin same thing and chromia as well finally okay so again you can see we had a strong performance in 2021. Now let's go finally to the final section which is the ecosystem breakdown. So we are lucky because all the charts are similar to what we saw previously on the narratives but now here the narratives are instead of being the narratives we are looking into the ecosystems and different blockchains that are supported on June. This is important because not all are supported on June or not all the assets I should say.

more precisely are listed on tune So here, for example, what I've done is take native assets off on each chain, for example, native DEX, etc., that are not present on other chains. For example, obviously, Uniswap and AVA and Maker are on many chains, so they are not here. But for example, on Arbitrum, if you look at Arbitrum, things like GMX, I mean, GMX is on Avalanche, but things like RDNT, GNS, these are projects that are just on Arbitrum.

And so yeah, here Grail, for example, is the main decks, native decks of Arbitrum. Pendel is now on more chains and the GambleFi project of VIN R is also mainly on Arbitrum. So this usually when there is an uptrend or as we say, season on any blockchain, like Solana season, Avalanche season, et cetera. the native tokens are the first ones to go to start going up because these are the best options so you would see that actually these are Dave so if it's Solana season then Solana native tokens will start like Jupiter etc they will start or bank from belonging to different narratives they will start to outperform go to the left side and all the things that we already discussed and for example it's interesting to observe that polygon is on the first position this month although it was consistently among the uh among the uh this like the worst performing uh ecosystems um in the last month so maybe there is a trend uh reversal now you might want to look into this kind of stuff if you're if you do ecosystem plays i recently added a new chart on this narrative dashboard which is this narrative leaderboard so let's actually go on into the real query so I can show you in more detail what this contains.

So here we are actually showing the performance of the narratives over the last six months. So we are ranking all the narratives and then we are giving points based on their rank, positive points and negative points. So the five best performance of each month are getting points proportionally, positive points and then the worst. performing ones the five worst performing ones are getting negative points then we are adding all the points which gives us a last score for each of the narratives so here are the details we can quickly look at the code so the first the best performing narrative will get five points the second best performing narrative will get four points and so on and the fifth one will get one point Let's mention that we have 30 narratives in total, approximately.

So, you know, these are good ones. And then, same thing for the negative ones. So, the worst narrative of the month will get minus 5 points.

The second worst will get minus 4 points, and so on, until the fifth worst narrative, which will get minus 1 point. And then... For the last six months, as you can see, we will add all of these points.

So we add all of the points. And then this gives us a point per narrative, but not all narratives. Only narratives that appeared in either the five best narratives of one of the last six months or the five worst.

Otherwise, they will not appear here. That's why you don't see all of the narratives here. So.

What does this tell us? I think for me this is very interesting, because it allows us to see what are the best performing narratives in the recent time, right? Because there is a lot of rotation with narratives, and what was relevant maybe one year ago is not relevant anymore. So first of all, there is this time component, so we are seeing the recent trends here.

And second, Although there are some outliers and one narrative might perform well for a specific catalyst in a given month, this doesn't mean that this is a general global trend. I'm again using the DEX as an example, a Uniswap mechanism feed that happened last month. Because of that, the DEX narrative was among the best performing ones last month.

most of the index tokens benefited from that, Uniswap, Sushiswap, etc. But if you look, if you zoom out and look at the last six months, let me actually zoom so you can see all the names here okay so here you can see that as i said i've tweeted about that but i don't trade dexes nor perpetuals because usually they do not perform well in terms of token after appreciation it's important to precise that because although these are really highly revenue generating established business models and and they are you know kind of profitable businesses protocols like GMX as a retail user or as an investor if you want to bet on the price appreciation of the token you need to understand actually and their upside potential and what we are seeing here is that these trends here these narratives here have not really performed well so I'm actually ignoring most of this with the exception of GameFi, so you need a bit of context to understand actually is this really some regular pattern or some short-term thing. I'm not ignoring GameFi, although it should be said that as we can see from the data, GameFi generally has not performed really well, although there has been some exceptions with infrastructure gaming tokens like Ronin, Immutable, etc. but now let's look at this part of the chart we can see clearly clearly you know some of the narratives that we know have performed really well uh identity with ens and word coin um i might need to actually change word coin to ai although it's i think it belongs more to identity anyways or ordinals had some good month um in q4 last year and also this month and they are performing well brc20 oracles so we saw pith from solana we saw chain link we saw ooma and api3 all of these tokens they performed well overall with the lrt and risk taking we saw a list c protocols like pendle benefiting from that and memes are performing really strongly in this month but also had good performances in october and december and L2s as one, you remember, Arbitrum, Optimism, Scale, Metis, as well as Stacks, STX, all of them had good performances.

So to me, what this allows you to see is actually where should I put my focus. So I'm certainly ignoring all of these narratives. I never have traded in the recent time any of these.

Again, there might be some exceptions. So I'm not ignoring NFTs in general, but I know that, you know, it's not their time yet. Although NFT is a big sector and some of them have performed well, like Puget Penguins, the same for GameFi, but anything here not actually really performing well.

Well, recently Bitcoin narrative is promising. And then here is, I have most of my focus here in this. like top five six so and this is of course changing every month and depending on the performance and depending on what's going on as you can see from this chart here and as you can see from the history of um of narrative so we know here identity ai memes lsds identity ordinals l2 ordinals ordinals etc um This is one thing I strongly recommend to look at this every month, every other week and put your focus on what's trending, okay? We know that betting on strength is something that historically works really well in crypto.

This is one thing. The other thing in kind of very practical advice that I wanted to share is Now, let's say that everything that I've said and all the analysis from all these charts and, you know, these charts and this chart, etc. Now you've decided that, for example, you want to focus on one or two narratives. What should you do?

What steps should you take and how should you trade them? So let's, for example, take the AI like this month. We have the memes and the AI narrative. that are the best performing ones so let's go on and let's go we can talk about them briefly let's go on memes so we can put here um flow key okay which brings us here to the meme narrative so here are a few of them compared to um if as you can see a great performance here on shiv on flokey on bald even on doge etc so really performing strongly recently i've added a bunch of these let me open this so you can see better okay so now let's say you want to trade the meme narrative And these are some of your options. This is not an exhaustive list, especially for the meme narrative where we have thousands of them.

But usually I put the strongest projects where there's ones with the highest market cap or liquidity there. And if there are new trending projects, I try to add them. So let's just for the purpose of this exercise, let's just focus on the list that we have here. Again, we mentioned that you have two ways of thinking about that either.

you want to focus on you know the best performing ones or if you want to see if there is a maybe a pullback or something on these ones and um have that so this is a choice that you should make but and there are some now now that we want to narrow down and practically know how you can trade that let me give you a few advice few tips on how actually i use that personally so here starting with the left part we have this project which is a recent one um sheep flow key will go pepe so i of course uh sheep is a big one pepe is a big one uh probably one of the biggest and flow key as well so to me uh you again you can think in two ways into that do you want to go with more established projects who are probably safer options in terms of maybe rock pools and this kind of stuff and concentration in the big wallets. These are better in that regard. Or you prefer the smaller projects who have a smaller market cap and might have much higher volatility but can have more upside potential.

This only depends on your risk appetite. I cannot give recommendations, but you should know that if you go into some of these projects, Some of these were newer, like Troll, you know, this is a recent one. Trump is a few months old. This one, Hemel, is pretty recent, I would say. These would have a lot more volatility.

Bobo as well. So if you can't handle like 50% drawdowns in one week, which some of these might have, then you should avoid this. But if you prefer... to have exposure to this narrative and you know um you don't have appetite for that much volatility you can go with some of these options so let's go let's say that that's your risk profile and you want to you prefer to go with the peer projects and this is what i would do personally or you can mix you can create a portfolio like if you want to allocate let's say 10k to the memes you can say okay i will find I will pick five of these.

I will create a meme portfolio for myself. And then you can go, then you can do combinations. For example, you can say, I will pick three like more established projects and then two like more risky projects.

And then the weightings depend on your risk profile. Again, if you want to be more conservative, you would give more weight to the bigger projects or maybe because now there are three against two, you can just... go with equal weights, et cetera, et cetera.

There are many combinations, and depending on your risk preferences, et cetera, or your conviction about, you know, maybe you do some research and you realize that actually, for example, Pepe has the strongest community in terms of whale distribution and wallets, et cetera, is a better one. And so these are some of the research that you have to do. to develop some conviction on each of them maybe you can score them on your own and come up with the scoring system based on different metrics like community like um everything you you want tokenomics etc etc i mean there are not a lot of metrics to talk about for memes but generally speaking you can come up with something for yourself and then um then you have a portfolio right you can say okay i will buy with my 10k i will buy 2k of SHIB, 2k of PEPPER, 2k of BOBO and 2k of Bitcoin and 2k of let's say ELAN.

Okay and then then you have to go on the entry side and on the trigger side, which is not the subject of this conversation here, this video. But just to give you an example, this is Pepe, for example. And you need a strategy, right? To enter and to buy and to sell.

Again, just for the sake of illustration, I will just take the moving averages because that's the simplest thing we can do. and you could say okay when there is a crossover here on whatever a number of moving average or exponential moving average you like you can buy and then when there is a crosstown you can sell on whatever time frame you like right so you have to come up with what you like and what you don't like um rsi etc and this is something that you have to decide but um then you have actually once you do that you will have a full system where you have a portfolio you have chosen your your tokens for a given narrative and then you have your entry and exit and you have your risk profile because you have defined the weighting of each of these etc etc let's also briefly talk about the ai example because i think it's a bit a better example compared to meme which is very limited in terms of fundamentals etc so ai so let's put ocean okay so here we are and so yes as you can see a very good performing narrative this month so again you have all of these options some of them have a higher market cap some have lower market cap so you can go on coin deco for example and if you put fat is the name so you can see already rank 49 market cap close to 3 billion so that's a pretty established project on the other side this one in q ai just 100 i mean not just but 112 million market cap and the rank much lower, this is ranked by market cap. So again, you can think in the same way, you can say, I will create a basket of three, four, five tokens, whatever you like. I recommend for each narrative to keep it between two to five, generally.

And then you can say, okay, I will take, like, if you like four, then you can say, I take two bigger projects and two smaller projects because they have more upside potential. You can do some research on some of these protocols and understand what they do. Again, here it's easier because, you know, it's not just about community, they're actually trying to achieve something, right, in terms of AI. You can try to research them, what is it that they're trying to do, is it decentralized compute, is it GPU related, is it like some kind of AI services that they're doing, and you can try to...

and actually build some conviction for yourself. So market cap is one consideration. The other consideration is what they're trying to do, their competitive edge, et cetera.

This might be a good subject for another video. I do not go too deep into evaluating different projects right now because we're talking about narratives, but you choose your tokens as you like. You keep the weightings, and then you're able to go. You have, as we discussed, you have your, here, for example, Fed has been also performing really well. So you define your entries or exceeds where you want to eventually enter on a pullback or anything, and then you have exposure to this narrative.

Or if you're a longer-term investor, you might not care about these moving averages and these technical analysis stuff. You just might want to allocate directly. With a long-term view, that's also a very good approach. And that's it.

So that's how you trade a specific narrative once you have chosen your preferred narratives. Just to finalize on that and some tips, I would recommend generally to focus only on two to four narratives. Minimum two because you need diversification of narratives because narratives of a given... tokens of a given narrative are highly correlated. As you can see, for example, most of the AI narratives related tokens are performing well, and most of the memes now are also performing well independently of the meme.

As you can see, they all have a good performance. So it's also good to think there might be a month where they will not perform really good, so you might want to allocate to two narratives or three or four, knowing that the less... narratives and tokens the easier and the more time you have to build conviction on them and to follow up with their development as well um so two narratives to four and then for each narrative two to four token again uh general just rule of thumb recommendations so that if you go with two narrative and two tokens you can have four tokens in general in your portfolio which is a good number if you have high condition and but if you go with for example four narratives and two tokens per narrative or three you would then have eight or twelve tokens i generally recommend having less than like 10 i think is a good number 10 or 12 um as different assets on your portfolio that gives you a very good diversification and and that's everything i wanted to cover in this video i really hope you enjoyed this in-depth tutorial narrative trading That's it for today. If you enjoyed this tutorial, please give it a like and subscribe to our channel.

We're just getting started on YouTube. We've done already a number of interviews with tier one protocols, as you can see, like Pendel and Etherfly and Kelp and others. And there are more videos coming soon. Also, make sure to follow us on Twitter where we are much more active and regularly posting content about narratives and new trends.

And from here, you can access our Dune dashboards and tutorials. As you can see, we have our narratives that are the most popular ones. Make sure to give a star to this dashboard that we discussed today so that you can easily access it from your favorites. And we have also other dashboards that you might want to see from CryptoSignal, Want to Buy and Sell, or Trading Names, or... the LRT protocol.

And finally, make sure to check out our newsletter. We have a weekly newsletter where we are sharing the best trends on crypto, as well as our premium sub-stack newsletter where we are sharing all the alpha. See you soon.

Transcript for:Navigating Success in Crypto Trading

Transcript for:
Navigating Success in Crypto Trading