G'day frothers,

Here is one of the economic indicators that I have been using to assess the crypto-economy, and why the market cap is relevant to assessing both individual coins and the strength of the economy as a whole.

1. MARKET CAP - coinmarketcap.com
![](https://steemitimages.com/DQmPRCjpFFPMhkGCQLAZ3WAT3VZCsvYNU63q7r46XbkFXwJ/image.png)
The market cap indicates the relative worth of both the overall economy and individual currencies within the crypto-economy

The picture above (although a little blurry) is a screen shot from a tab I always have open. This is, without doubt, the most important indicator in the crypto-economy. 

I  was able to identify last week's correction as a "panic sell" most likely led by professional profit taking following some extraordinary gains in the previous week. I surmised that it was not confidence in any one coin that had been rattled, rather a correction in the overall value of the crypto-economy. 

When one coin starts plummeting even I am tempted to sell. BUT a 20% reduction in the overall market cap gives me confidence that it is nothing more than panic, driven by professional profit taking. If I am correct with this assessment, all I have to do is wait for overall market confidence to be restored, and the money will flow through the economy and into my coins (provided I have done my research and chosen good companies to invest in).

By doing your research and using market caps as an economic indicator, you too can see these sell-offs as an opportunity to stock up.... if you haven't overcapitalized (ie. spent most of your investment budget with previous trades).

More economic indicators to come. But the market cap is for me, the single most important economic indicator in the crypto-economy.

Keep frothing frothers,

Fish