Are you new to crypto and don't have time for FA and TA? You might come across ads on twitter or social media for signals groups and think they will do collective organised research for you. In theory, without thinking too hard. They do seem like this.
Welcome to the drama filled land of pump n dumps.
Back in the bull-run days of BTC, you could flip a coin and 10x your profit. Everything was going up, so pump n dumps seemed to be working. Now that we are in a bear market though, prices of entry have dramatically dropped, groups have started biting each other, and the deception is becoming painfully clear.
Eventually, everyone ends up despising these groups, and you will end up with a portfolio worth less than if you'd just invested in a handful of top 10 alts. If this were a regulated market, they would be highly illegal. And the reasons go beyond just market manipulation.
Who am I? An ex-admin of a popular group. I did not directly post signals to any channels, but I was used for a long time for research and hard work, only to be kicked when I didn't pay up, strangely enough (these people don't have business intelligence and wish to milk everyone they can).
How signals groups make their signals appear successful.
From deleting posts to just outright making up calls that never happened, you name it. Here's one from Kara's Coins where she claims 34% profit out of thin air. This is consistent in the calls she makes, alongside deleted posts.
One common method employed by Cryptoland and Palm Beach Signals is to post results of what would happen if you bought the coin at the earliest time they ever called the coin. So, if you buy ICX in december at $1, and they close the call, but then re-open it in feb, even if the coin goes down from the second call, if it is at $3 they will claim a 300% profit.
Groups have a harsh policy on criticism so when people start asking about where the signals came from, they are kicked without refund and all of their posts are deleted, as if they never existed. Because it's crypto, you have no chance to complain and no recourse to recover your money even if you purchased a lifetime membership.
This user was kicked shortly after posting this. It's a common occurrence as they realise what's really going on.
How signals groups make money.
It's a simple process. When they make a call, they already have their money in. Generally some of the larger groups collude to produce the same signals. There may be some TA or research behind the signals, but the groups don't do it. It's freely available info from twitter.
Once the admins all have their money in, the call is made in the premium member groups. The premium members get in and hopefully the price goes up. The only thing sustaining the small tail for the members are the free channel losers at the end, trying their best to FOMO into a pump.
These signals are a great way to lose your money, damage the crypto space, and are illegal.
Things to check for
- Do the groups never seem to back up any of their calls?
- Is the chat largely comprised of users talking, and no admins teaching?
What to take from this?
Signals don’t work in a bear market. You need to either learn how to sideways trade and take responsibility or move into tether and set a healthy stop gain.
A heavy understanding of the market and advanced trading expertise are required to survive in this environment. There are no short cuts.
There are groups out there that are free and have a lot of expertise and are just focused on learning and sharing actual TA. If your group is asking you for money, reconsider the motives behind it. You are the product, and you will walk away poorer.