Using DEX Platforms
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When using any decentralized exchange (DEX) app for trading or charting, you will find a section called Top Traders, which displays the wallets with the highest profit and loss (PnL) in the traded token. This section can provide valuable insights when looking for profitable wallets to copy-trade.
The Top Traders section can reveal important patterns and behaviors of successful wallets. However, it is crucial to differentiate between different types of wallets. There are two primary scenarios to consider:
Wallets that sold more tokens than initially bought:
This means they transferred the tokens from other sources, making it essential to track their origins.
Use tools like Solscan or other Solana block explorers to trace their history.
These wallets will typically appear as "Unknown" in the Balance tab of DexScreener.
Example: If a wallet shows an "Unknown" balance, further tracking is required.
Wallets whose number of tokens sold is equal to or less than the amount initially purchased:
This indicates that the purchases were made entirely from the same wallet.
No further tracking is needed.
Example: Wallet 2 may show information in the "Balance" tab, making analysis easier.
When analyzing a token in DexScreener, you may observe the following:
Some wallets will have sold more than they bought, meaning they received tokens from another wallet. You will need to track their source.
Wallets that have purchased and sold equal or fewer tokens can often be more reliable for copy-trading.
Platforms such as Photon, Defined.Fi, and GMGN provide similar features, but there might be minor differences in data sources.
While the Top Traders section provides valuable insights, it comes with several drawbacks:
Highly Accessible Data:
Anyone viewing the token's top traders can access the same wallets, leading to increased competition and making them heavily copy-traded.
Capital Requirements:
Many of these traders operate with large amounts of capital, meaning their strategies might not be effective for smaller traders.
Example: Top traders make large-volume buys that smaller accounts may not be able to replicate.
Token Transfers:
Many top traders move tokens between multiple wallets, requiring additional effort to track the complete trade history.
Sniping Behavior:
Some successful wallets achieve profits by sniping token launches within the first block.
This tactic is difficult to replicate without specialized tools, such as custom sniper bots.
An example wallet: BECep66KrL7NbUNHq3qyPcMrUTokZbuTxXNCkkceM5w
This wallet might have shown large profits due to early sniping techniques.
Tracking its history can provide insights, but replicating its strategy could be challenging.
Using the Top Traders section in DexScreener can provide a starting point for wallet discovery, but caution is advised. Keep in mind:
Always conduct further research beyond DexScreener data.
Be wary of wallets that transfer tokens from multiple addresses.
Ensure your capital aligns with the strategies employed by top traders.
Ultimately, relying solely on this method may not be the most effective approach, as heavily copied wallets tend to exhibit high risk and volatility.
