Chart Of The Day: Avoid This Token Trap

(Resumen en español al final.) 

Summary

  • New Steem-Engine tokens are showing a strange price pattern, crashing 80-90 percent in only some days.
  • Be careful with the new tokens.
  • (Testing migration of posts. I published this post originally on Steempeak and Steemit, August 16, 2019.)

Making my researches about Steem-Engine token prices I realized there are some really strange cases. Some tokens crashed 80-90 percent from one day to the other, or in a couple of days. Like heavy stones falling. I think mostly the new ones.

New Steem-Engine tokens crashing 90-99 percent

TUNES, SPACO, AFIT, RHB, MARLIANS. What do these tokens have in common? They fell 90-99 percent in some days or weeks. These are the worst-performing tokens among 30 by my last research.

PORN and SPORTS didn’t reach the 90 percent line, but the price move is very similar, I see the same pattern. A quick crash in 1-5 days. (Let me assure you that the organizers or developers of the tribe may have done all right. I don’t mean that was their fault.)

cod avoid this token trap.jpg

(Click to view in higher resolution.)

Mispriced IPO-s

How could this happen? I have a theory, knowing similar cases in the traditional stock market world. The cases of mispriced IPO-s (Initial Public Offerings). Sometimes the issue price, or the first price on which the stock is reaching the public market, is simply wrong, set too high. The market mechanisms are working, moving by their way, and the truth, the real price comes to the surface in some days or weeks. The stock begins its career with a huge free fall.

Facebook also began with a big fall, but recovered later, and is doing very well since then. Some of these tokens can recover in the future. The truth is, I have no idea. I don’t know how much the “real value”, “fair price” or “fundamental value” could be.

No method to estimate

Perhaps, Steem-Engine token investors have simply no idea either how much a token is worth. Steem-Engine tokens are something completely new, there are no known methods to determine any initial price, equilibrated value.

Also, the “dumping effect” is strong by these low Steem prices. As people are selling Steem, pushing the price down, I suppose also many of them are selling Steem-Engine tokens and walk to the exit.

Lower price, more sellers, more sellers, lower price

In the new “Spanish Tribe” or “HispanoHablantes” site, @ylich wrote about why people are dissatisfied with SPACO token and are dumping it. He says many aren’t familiar with downvotes, are experiencing it as aggressive behavior. They are also disappointed with the decreasing price of the token. So they are selling it in big quantity.

People are used to seeing downvotes in first place on posts made with plagiarism, or spam or posts having other major ethical issues. If they receive a downvote they are offended or discouraged. Maybe this shall be a warning to other tribes, and HF21-lovers, too: be careful with the weaponry of the downvotes.

Conclusion?

I think I should never buy a very new token, seems to be better to wait 2-3 weeks until things calm down. And if I plan to sell something, I should better make it quick.

But I can imagine also other scenery in the future. If Steem went upstairs, if all token prices went up, in a new hype… maybe new tokens could bee scarce and prices would surge after the first day. But this is also only a theory. The general rule, maybe you are tired of it already, but very true: Take care of yourself and never invest more than what you can afford to lose.

Resumen en español

Este gráfico ilustra que algunas monedas nuevas de Steem-Engine, como también SPACO, muestran movimientos extraños de precios. En los primeros días, o un poco más tarde, pero rápidamente, en solo unos días pueden caer 80-90 por ciento.

Una explicación para esto es que el precio inicial fue subestimado. Este es a veces el caso con nuevas emisiones de acciones también en el mercado de valores. Ylich escribió que muchos se sentían atacados cuando recibieron un voto negativo. Les parece una agresión. Otros venden SPACO porque les molesta la caída de los precios.

Conclusión:

Simple. Cuidado con los precios de las monedas nuevas, no arriesgues demasiado.

The series “Chart Of The Day”

I started a series with the title “Chart Of The Day” because I see every day interesting events or phenomena on the markets or in the news. Other parts here:

The last ones:

Older ones:

(Photo: Pixabay.com)

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