This article introduces the DEX Unique Traders metric and how to capture bullish and bearish signals via it.
The Unique Traders metric refers to a sum number of unique addresses with buy/sell actions of a particular token on DEXs in a given time.
For example, suppose there are four transactions.
|Address A sell tokens to address B|
|Address A sell tokens to address C|
|Address C buy tokens from address B|
|Address C buy tokens from address A|
There are three addresses with buy/sell actions of this token in the above case. Hence, the Unique Traders number is 3.
How can I use it?
This metric can reflect the level of market enthusiasm. Generally, hot projects will attract more investors.
Identify bullish and bearish signals.
An increasing number of addresses are trading the token. This is because this token may have attracted public attention as positive news or significant developments from its project. Generally, a well-known token attracts massive traders that may benefit the price.
A decreasing number of addresses are trading the token. This may reflect that traders are giving up this project as pessimistic emotion, negative news, or bad reputation of the project. Decreasing amount of traders can cause liquidity issues and price drops.