Predictive Strength
unravel
unravel
Predictive Strength
Measures the ratio of positive to negative mentions on Telegram.
Telegram groups exhibit faster reaction times to market-moving events compared to traditional sentiment sources. Crypto OGs and professional traders often coordinate in private Telegram channels before news becomes mainstream, creating a 6-12 hour lead time window. The platform's encrypted nature allows discreet position-building that later manifests in public market moves.
Top crypto Telegram groups represent a self-selected pool of committed market participants. Unlike Twitter's broad audience, these channels contain:
This density of high-conviction players creates a "smart money" signal filter.
Positive sentiment → Price increases → More bullish messages → New entrants joining groups creates a self-fulfilling prophecy loop. The platform's group discovery algorithms surface trending channels to new users, creating a natural momentum amplifier. This reflexivity is particularly potent in low-float altcoins where Telegram communities directly influence liquidity conditions.
Telegram sentiment data is sourced through exported chat logs of specific cryptocurrency-related groups, followed by preprocessing and analysis via machine learning models. The raw sentiment scores are then normalized against historical averages to create a relative index.
unravel
To understand a predictive factors predictive power, we create a simple long/short strategy and simulate its past performance (with daily rebalancing):
The strategy is rebalanced daily, on a continuous basis. There are 0.5% transaction costs applied on each position adjustment.
Get started by validating the historical performance of the strategy with our transparent code snippets.
Copy and paste the code snippets below into your Python environment or download the files below.
Predictive Strength
Predictive Strength
Predictive Strength
Predictive Strength