Good day Hiveians!
Join me in analyzing the crypto markets!
The last couple of weeks and months have been rather red
Seemingly we are going from one low to another. But it is in times like these that one can actually learn how to put emotions aside and learn from market movements. Psychologically, it can be tough to see -30% or -50% or even -80% in one's portfolio. Newcomers might "freak out" or get depressed when caught in such a position. What makes it more terrible is that one might tell oneself that the market is about to go up again, only to see it go down another 20%... Anyone who has been with crypto knows that these times come and go.
The emphasis is on go. The market never just continues to go down, just as it never continues to go up. The "trap" however is that the downward corrections last much loger than the brief upward movements. One realized pretty fast that all markets are actually a representation of humanity's psychology. The wave pattern symbolize the working of our emotions and sentiments.
But I have found that one can earn a valuable lesson in these situations.
Detach yourself from the immediate
And think long-term. The best thing one can do is stick with a project that has potential. By doing so you know why you are invested in the project and you will be able to withstand (heavy) losses. Hive is a great example. With Hive it is e.g., possible to continue to earn in correction phases. Just keep posting and curating content and you will get a 10-15% return! You can also take this as a chance to learn more about the fundamentals. What projects are there on Hive and how will they perhaps add value to the whole ecosystem? What tokens could be a good investment? You get the picture... It is a great time to detach oneself from price and learn about the potential of Hive.
Learn how the market works in a (mini) bear market
Another great thing one can do is to do is to look at how the market trades in real time on a small (or large) scale. Let's try this out...
BTC has seen three corrections and plateaus over the last couple of months:
In all of these phases it looks like bitcoin is going to continue lower and lower. Prices dip and dip and the "fear index" is very high. But then, just like that, the tides turn and bitcoin jumps higher and enters into an impulse wave. This always happens when things look the worst. Just look at the first ellipse: would you have expected bitcoin to make that jump up? It looked like it was just about to head to 20k... But it didn't.
To get a better understand of that we can have a closer look.
All of these three "scary" movements were/are trading in a downward pointing channel. But something happened which stopped that movement. You can look at my previous posts to see that there are generally trend lines which act as a support and can make such a trend change. But in this post I want to take a bit of a different look...
In the 15min chart we see something interesting.
At this scale one can really see how the market moves in close up. Have a look at the following movements marked with the rectangles.
We see a pick up in volume when price goes down, but in all of these cases the red volume bars turn green. This means that there is a "wall of buyers" that are acting as a support. This happens quite frequently and means that the "bears" and "bulls" are battling it out. What this signifies to me is that there are still enough bulls to keep the price afloat. Even very strong sell offs are met with this resistance. The fact that this is happening so often could indicate that the support in this price area is strengthening rather than weakening - just as we saw in the previous two plateaus. The patterns as such are very similar to one another.
Another thing that can explain price movements are the horizontal support and resistances seen here:
These can go very far back and in fact we have support from these lines from over a year ago. With being said, anything of course can happen. But my advice would be to try and detach oneself from these market swings, which of course also means that when prices jump 100%+ that one also tries to look at the market in a detached way. Maybe it is a good selling area, or just hodl as the bull market top should still be in for 2022
As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!
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