No longer a pawn for big players, master the trading strategies for Memecoins in the era of social trading.

Written by: Route 2 FI

Translated by: Chopper, Foresight News

After enduring the long silence of a bear market, the frenzy cycle of Memecoins has returned.

The market's risk appetite has fully warmed up, feeling like a return to 2024. This situation is not only happening on Solana but is also appearing on the L2 blockchain Robinhood Chain, which has only been launched for two months. In addition to the hot trading of Memecoins on-chain, a business model that can generate real profits has already emerged within the Robinhood Chain ecosystem.

For example, Pons is the main token issuance platform on Robinhood Chain, where users can issue and trade new tokens. It has now entered the top ten of the crypto industry revenue rankings, second only to the leading token issuance platform Pump.fun.

As platform revenue skyrocketed, Pons tokens formed a positive self-circulation, with a market value once exceeding 900 million dollars. Early investors gained substantial returns, and it has become a benchmark target for the entire ecosystem and even the whole market. Cashcat is the first Memecoin from this public chain to gain wide attention, while Pons has lowered the threshold for ordinary people to issue Memecoins.

After this, a large number of coin varieties with astonishing price increases were born, attracting a group of old players who once declared the end of the crypto industry back into the market.

The current market is indeed filled with money-making opportunities, with people showcasing their profit and loss screenshots everywhere, but in fact, most profit screenshots are not genuine.

Trading Memecoins is one of the most volatile investment activities: profit can multiply by a hundred in the morning, but by night it might retract by 99%. Ordinary investors often enter the market too late, as insiders, front-runners, and early buyers have long acquired their chips at low prices.

Just because others are making substantial profits does not mean you can profit too. The liquidity of Memecoins is extremely thin; paper profits do not equal realized gains.

This article will teach you how to trade steadily in a gambled market, avoid suffering large losses, earn your profits, and not become the pawn for big players dumping their stocks.

To excel in Memecoin trading, you must establish a complete trading plan. Blindly entering just because others are displaying profits is a wrong start. You need to clarify your trading direction; otherwise, you will only follow the crowd and end up with nothing.

Select a Fixed Trading System

The competition for Memecoins is extremely saturated, with new projects changing rapidly. If you cannot manage your attention, a massive amount of noise will only waste your energy.

You need to clarify the specific trading models you focus on, control your attention, and continuously improve your trading skills, which is particularly important for beginners. There are various trading styles in the market:

• Belief traders: Lock onto a set trading logic, hold with high stakes over a time period, waiting for the market to reward.
• Follow traders: Track the wallets of many top traders, and when multiple wallets buy the same coin simultaneously, conduct in-depth research, adopting others' trading logic to form your own judgment.
• Short-term quick entry and exit traders: Early involvement in coins with a market cap of only 100,000 dollars, and take profits upon reaching target prices. For instance, selling 50% of the holdings after the coin doubles, keeping the remaining holdings for higher returns.
• Single-chain deep players: Focus on a public chain with informational advantages, continuously scan new Memecoins, capturing asymmetrical profit opportunities.

There are many more ways to play. For experienced traders, multiple strategies can be attempted simultaneously, but beginners should avoid casting a wide net. Prioritize deeply developing one or two trading models and concentrate your efforts.

As trading experience accumulates and trading ability gradually improves, then attempt to expand into other trading styles. The most effective way I enhanced my trading ability early on was by fully documenting every transaction, regardless of whether it was profitable or not.

Why did I incur a loss? What is the core logic behind the profits? What conditions lead to a stop-loss exit? What supports the bullishness of this trade, and what are the risk points that could break the logic?

A trading journal is the best way to enhance Memecoin trading skill. No longer mindlessly rushing into low-quality coins, every operation should have sufficient trading logic. Having experienced the full cycle of bulls and bears and captured numerous unexpected coins, there are even more trading principles.

Some may think that frequently trading short-term is easier. But for beginners, short-term operations without clear trading logic are hard to achieve stable profitability. It is better to choose early quality targets for long-term holding based on one's own judgment, as profits may surpass those from frequent trading of low-quality coins.

With the popularization of following trading models, traders no longer need to manually scan on-chain data or pay Gas fees separately to complete trades. Some veteran players still retain traditional trading methods, but trying new tools is also a good choice; convenient tools can lower the threshold for profit-making.

Below are two mainstream social trading applications: Pumpf.un and Fomo App.

Fomo App

If you have been active in the crypto community recently, you've likely seen a lot of users sharing their trading profits and losses using Fomo App while trading Memecoins. This product is popular because it simplifies the complex processes of Memecoin trading: Gas fees, token authorizations, and other tedious steps are all encapsulated and simplified, allowing users to buy Memecoins with a single click.

The product supports direct purchase of tokens with bank cards, a feature that has propelled it to widespread recognition. Currently, Fomo App has surpassed 500,000 users, ranking among the top ten on crypto income lists.

The true innovation of Fomo App lies in its breaking of closed circles. In the past, players who made substantial profits from Memecoin markets mostly belonged to private groups; now you can directly track profitable traders, see the trading logic behind each coin, and if you agree with their viewpoints, you can follow their trades with one click.

The first time I downloaded Fomo App, I followed about 20 prominent figures in the crypto community and then switched back to the X platform. My phone notifications continuously popped up, one after another...

The overabundance of notifications left me perplexed; I had no idea which coin to buy, and ultimately had to close the software notifications to focus on researching the market. Afterward, I devised a correct method to use the tool.

Profit screenshots are merely superficial; do not blindly rely on displaying them for following trades.

The most common mistake for beginners using Fomo App is opening the leaderboard and bulk-following 20 top traders.

The constant barrage of trade push notifications can replicate my initial experience. Emotional, random buying, impulsive trading ultimately leads to losses.

These impressive profits are mostly just paper gains and not actual realized profits. In the past 60 days, only 0.25% of traders have made profits exceeding 500 dollars. These profit screenshots do not reflect the true earning situation in the market.

Personally, I pay more attention to the 30-day rankings and overall period rankings, filtering for traders who have been steadily profitable over the long term rather than those who became wealthy in a single day or are on short-term seven-day leaderboards.

The core purpose of checking the leaderboard is to learn from top traders, analyzing why they can always capture new narrative coins in advance.

When filtering traders, prioritize those you are familiar with who are quality traders: those who publicly record long-term stable profits and thoroughly explain their trading logic so we can learn from their analytical thinking.

Do not follow a large number of traders; at most, select 5-7 quality accounts to avoid being distracted. Quality traders who rely on logical trading will not frequently open positions, and every trade notification they send will have reference value rather than being ineffective noise.

Kyle is a well-known trader in the crypto community, and he has impressive earnings on Fomo App. Checking his positions, $PONS is his heaviest asset, and by clicking on the coin, I can view his complete trading logic. After reviewing his four core trades, I summarized his trading strategy:

• Long-term steadfast holding of assets, laying out heavy positions early in the market.
• Publicly sharing complete bullish logic for others to reference.

Having established his strategy, following his trades becomes much easier, but this is not a simple task. Rasmr, a well-known player on Fomo App, has also shared trading insights: how to identify market catalysts and filter coins with upward potential.

Your trading speed must surpass that of other followers.

The biggest misconception for beginners using Fomo App is to follow the crowd and use one-click following for all trades. If your only advantage is mindlessly syncing orders, your results will align with those of the majority of retail investors. You need to act quicker than the average follower.

Automated trading is the best solution; there is no need to build tools from scratch, ready-made applications can handle it. This solution is not suitable for pure beginners but rather for investors who want to automate Memecoin trading without spending late nights watching notifications.

Select the top trading accounts you want to follow, search by username, set automated follow parameters, and your strategy will run automatically. A crucial reminder: this method is very risky; your financial gains and losses fully depend on the proficiency of the trader you are following.

Fomo App also has some overlooked practical features.

Trending boards: this is my favorite feature, providing a clear view of the hottest narratives in the market, predicting the direction of upcoming trends, and understanding which targets current market funds are concentrated on, assisting us in determining whether to enter the market. I usually start by looking at the top ten assets on the board and researching the reasons behind any short-term declines in coins to assess whether there is a rebound opportunity.

The popular tokens feature is similar, showing the most highly regarded tokens at the moment. Tokens with the highest holdings often have larger market caps. As the name suggests, funds are concentrated on these tokens. However, on the trending page, you will see more lower market cap tokens, as they are just popular for the day, yet they may also become the most held tokens.

For this reason, I pay special attention here, carefully studying the narrative logic, making it easy to capture unexpected coins. Ultimately, the core driving force behind a coin's rise is the community consensus built around the narrative.

Pump.fun

Pump.fun's logic for filtering quality traders is generally consistent with that of Fomo App. The rankings on Pump.fun are divided into three categories: total profits, realized profits, and paper gains.

In contrast, Fomo App's rankings only account for floating gains. Combining these three data points, I pay more attention to traders who can continuously realize profits; at the same time, I observe the profit-taking points and accumulation methods of floating gain traders, applying the analytical approach used for Fomo traders in research.

On Pump.fun, there is an additional profit incentive mechanism: Callout recommendation rewards. If you have confidence in a particular coin, you can publish a recommendation to showcase to all your followers. Pump.fun distributes Callout rewards daily to incentivize users to post high-quality content, with the reward amounts linked to the trading volume generated by your recommendations. Data shows that 87% of rewarded users have less than 250 followers, meaning smaller accounts have more opportunity.

Just a reminder: do not spam the platform for rewards by brushing up token arbitrage; the activity has strict user agreements.

If you've read this far, it indicates that you seriously want to deepen your on-chain Memecoin trading. Following trades has fundamentally changed the trading model in the last Memecoin bull market of 2024.

While there are still some tools I want to list in my mind, it’s not necessary to be overwhelmed by having too many tools. In fact, top traders, like Smartestmoney who earn millions of dollars annually, have stated that they have never used TradingView. This shows that tools are ultimately just tools.

Your persistence, mindset, experience, etc., are the keys to your success in trading. Wishing you to seize the bullish market!