How a Single Strategy Crypto Algorithm Gained 176.31% While Bitcoin Up 65% in 2022
Before we get into the nitty-gritty of how a simple rule created the kind of insane return on investment mentioned in the headline – during one of the worst crypto winters in recent history – let’s be clear about one thing.
You cannot copy this now.
But anyone with access to Cointelegraph Markets Pro in 2022 could have. This is not just a back-tested strategy. It’s a real-world strategy – even if you’re about to see historical results.
This is no longer a thought experiment or proof-of-concept; there is an actual way to make money from crypto trading.
For our purposes, it’s also a perfect way to illustrate how a simple strategy can work for real traders in real life – even during extreme market declines.
So let’s dig in. What can you do right now, today, with this algorithm?
What does “Buy 85, Sell 80” mean?
Here is the basic premise. In collaboration with data firm The Tie, Cointelegraph Markets Pro has developed the VORTECS™ Score, an algorithmic determination of how bullish or bearish current trading conditions are for a given crypto-asset.
The score is based on historical data, and it essentially sifts through the entire history of a coin or token looking for conditions similar to those it is observing right now.
It looks for a range of similarities and outliers – such as trading volume, recent price action, social sentiment and even the volume of tweets about that asset.
If it finds similarities, it looks at what happened next. Did the asset go up or down? How consistent was that movement? How significant was the rise or fall?
By combining all these data points, Markets Pro creates the VORTECS™ score, a dynamic and ever-evolving evaluation of current trading conditions for each supported asset. The higher the score, the more positive the outlook – and the more secure the algorithm.
Conversely, a very low score is bearish (with equal confidence). A neutral score of 50 means the algorithm sees no significant correlation between current conditions and past price performance.
The Markets Pro platform offers a whole range of strategies to traders.
A “Buy 85, Sell 80” strategy means that a trader can buy an asset that crosses the 85 score, which is considered strongly bullish. And then “sell” the asset when it goes below the 80 score.
This of course happens live at an exchange. Or a trader can simply “paper trade” the asset to test the algorithm.
For example – if Solana’s SOL crossed 85, and was the only asset with that high score, the trader could place a percentage of his current portfolio in SOL. However, if Binance’s BNB then also crossed 85, the trader can allocate another percentage of his portfolio to BNB. Or not. The choice is theirs.
So why is this valuable to know?
The point here is to assess whether the VORTECS™ algorithm is good at its job.
When it sees bullish conditions, is it correct more often than not? When the score goes up, do prices generally go up? Of course the answer is yes.
Buy 85, sell 80 is just one strategy. There are other strategies that have created a huge return on investment in 2022.
For example, buy 90, sell 85. It is sitting on gains of +96.89% in 2022. Even stronger strategies include:
Buy 90, Sell 90 | +159.15%
Buy 85, Sell 75 | +102.65%
In fact, Bitcoin (BTC) has returned -65% since the start of 2022, and Ether (ETH) did no better with returns of -68%, while VORTECS™ based strategies averaged +81.50% across the board, beating the pants from BTC and ETH respectively.
And it signals that VORTECS™ is working properly. It shows – generally over time – that historical trading conditions for digital assets can be a useful gauge of the current state of health of that asset.
In other words, a high VORTECS™ score has a proven correlation to price increases. Not in all cases, not for all assets…but overall, the results in 2022 have been a compelling case.
Warren Buffett (perhaps paraphrasing Georg Wilhelm Friedrich Hegel) once said that “What we learn from history is that people don’t learn from history.”
(As a cryptoskeptic, he might want to revise his stance.)
That’s what the VORTECS™ score is all about. Learning from history. And that’s why a real return of 176.31% in the middle of one of the worst crypto winters in market history is important.
That tells us we’re looking at the right story.
Cointelegraph Markets Pro is available exclusively to members on a monthly basis at $99 per month, or annually with two free months included. It has a 14-day money-back policy to ensure it suits subscribers’ crypto trading and investment research needs, and members can cancel at any time.
Cointelegraph is a publisher of financial information, not an investment advisor. We do not provide personal or individualized investment advice. Cryptocurrencies are volatile investments and carry significant risks, including the risk of permanent and total loss. Past results are not an indication of future results. Figures and diagrams are correct at the time of writing or as otherwise specified. Live-tested strategies are not recommendations. Consult your financial advisor before making any financial decisions.
All stated returns are accurate as of 08:00 UTC 17 November 2022
