If you just briefly follow the crypto markets and news you probably noticed that there is a serious downfall in prices happening in the last few days. Some call it a “bloodbath” “a burst of the bubble” others see it as the opportunity to increase their positions – buy more cryptocurrencies. So which is it then?
Panic or opportunity?
With all the hype surrounding the cryptocurrencies, it’s only natural that these things happen. It is perfectly reasonable for prices to fall 20-30 percent in a single day. Do not forget the fact that we saw prices increase as much as 150% and even more in a single day. Taking a quick look at the total market cap chart shows us that we are basically where we were less than a month ago market cap wise.
There were a lot of people that didn’t know what they are getting into and just bought cryptocurrencies because of the FOMO or just overall hype. When the prices start to drop these people with no long term strategy, tend to panic sell which then causes the prices to drop even further. Eventually, prices stabilize because of the long-term investors and traders with clear strategy and knowledge.
This is what the market does; it eliminates the people who aren’t patient and don’t have the strategy and just bought in because of the hype or some other un-rational reason. Having the right strategy and sticking with it always proves to be the right way to navigate the stormy seas of crypto markets. Do the research, choose an investment strategy and make sure you stick with it. If you don’t feel competent enough yourself find a professional to do it for you and you to will see the next “bloodbath” or “a burst of the bubble” just as another opportunity to increase your positions – buy more and get ahead.
Peter, Crypto-Trader Club