Before getting into the algorithm itself, it is essential to be clear that no human can copy this strategy. Even a bot can not replicate this particular strategy in real life as it’s a conceptual experiment instead of an actual plan of making money in crypto trading. Only exchange fees would ruin this specific strategy for most traders.
However, that doesn’t mean that this strategy is useless. It’s the perfect illustration of a simple system that can work in real life for real traders.
The Crypto algorithm
Cointelegraph Markets Pro, in partnership with data firm The TIE, has developed an algorithmic determination (the VORTECS™ Score) of how bearish or bullish trading conditions are for a specific crypto asset.
The Score depends on historical data while sifting through the whole history of a token, searching for conditions similar to the coins it observes at the moment.
It’s looking for similarities and outliers such as trading volume, social sentiment, recent price action, and even the number of tweets about that asset.
If it manages to find similarities, it goes to the next level. It starts finding out if the asset goes up or down; how consistent was that movement, or how significant was the increase or decline.
After connecting all of these points, it creates a dynamic and continually growing evaluation of the current trading positions for each supported asset, which is also the VORTECS™ Score. If the Score is high, the outlook is also positive, which means that the crypto algorithm gains more confidence.
A neutral score means the algorithm detects no significant correspondence between current positions and past price performance.
The Markets Pro team began testing a various range of strategies after it went live.
There is a strategy called “Buy 80, Sell 12 hours,” which means that the test purchases every asset that passes the 80 scores and sells it after precisely 12 hours. It’s happening on a spreadsheet and not on an exchange.
Why people can not do this
The test is working 24 hours a day for more than ten months, which means that the human can not be awake for that amount of time. Another reason is that the algorithm does not consider order depth on any asset on any exchange. It buys and sells at the current price.
And the third reason is that exchange fees for a rebalance per hour would be prohibitive, no matter how much FTT or BNB you have.