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3 things that can not be done when bitcoin falls.

With cryptocurrencies gaining traction in recent years, Bitcoin is a standout asset worth considering. The cryptocurrency has fluctuated substantially since its launch in 2009, and it can be difficult to know what to do when Bitcoin falls. Here are three key points to remember about the crypto: it cannot be sold, bought on margin, or hedge a portfolio. Knowing and understanding these critical points can help investors make wise decisions when Bitcoin falls.

If you are going to trade or invest in cryptocurrencies (or are already doing it), be aware that this is a psychological battle with your own shadow. Market players often recall that investing in classic stock markets requires extreme mental discipline..

It consists in the strict control of himself when the market becomes unstable. She protects them from making stupid decisions and keeping a calm, judicious look at her strategy.

If classic investments require strict discipline, then the cryptocurrency market requires the mental strength of the Jedi. The cryptocurrency market is more volatile than any other that the world has ever seen. Your emotions should be locked in the same way as Master Yoda, who meditates on a mountain peak during a meteor shower, when bitcoin falls.

Reza Jaffery, Bitcoin Consultant and Head of LVLUP Dojo, Tells What Should Not Be Done in a Falling Cryptocurrency Market.

Fortress of spirit.

bitcoin is falling

Cryptocurrencies are a market in which there are many more individual investors than anywhere else. You can see it for yourself if you look at the price graph in comparison with the Google search trend graph for the word “bitcoin” or bitcoin.

Bitcoin Falls

12-month BTC

Bitcoin Falls

Google search volume for 12 months

Charts are similar in nature. It says – the higher people’s interest in bitcoin, the higher its value. The graph of search volumes looks smoother because fewer data entry points are used to build it..

In fact, we see that an increase in search volumes directly affects the value of cryptocurrency. This is a simple market law: more interest – more demand; more demand – higher cost of goods.

When the market is highly prone to sentiment, price movements have emotional implications. However, in order to reach the top of the market driven by emotions, you should completely exclude your own feelings from trading..

Managing emotions is not the need to do something specific (as is often the case in any field). It is a necessity not to do something that is difficult to control. This is a manifestation of mental stamina, which was mentioned at the beginning.

When bitcoin falls and its price flies down, you watch how all cryptocurrency holdings lose value. Keeping cool at this point is really difficult. You want to sell assets, but you are wondering if Bitcoin will return to its previous level. Unfortunately, no one has a magic crystal ball to predict this with accuracy. But with quite a lot of certainty, we can say that he will go up again.

1. Do not try to “find the bottom”

bitcoin is falling

When you look at the cryptocurrency value chart, watching how it falls in price, you wonder when the decline will stop. You involuntarily try to “feel for the bottom.” You are trying to enter the low point of the trend in order to buy currency at the lowest cost and earn more in the end. But such a “grope” is very dangerous, therefore, in the English-speaking investor environment it is also called catching a falling knife – catching a falling knife.

If you regularly try to catch this knife, most likely you are going to skip bidding. Trying to be a perfectionist, you lose more than you gain, since a long wait almost always leads to the loss of a good moment.

Sometimes, if you plan to enter a downtrend, it is not necessary to make a deal at the very minimum. Waiting may not pay off.

Of course, if you are a master of technical analysis, like Gandalf White or the Cosmic Trading team, you have a chance to find the bottom of the chart. Then this advice is not addressed to you, but to the rest of the retail investors, who are the majority. They are not “Wall Street wolves,” and they can earn more money if they stop thinking about themselves in that way..

2. Do not betray your strategy for growing trends

Your line is simple and straightforward. You have a plan, and you act in accordance with it. Many of us want to shop at the bottom of the trend and then watch their assets grow. But not everyone has the patience. Make it enough for you.

It seems that every time someone sells one of some cryptocurrencies under pain of losing everything, right after that it starts to rise. This is called FOMO (Fearing of Missing Out) – a common fear that provokes a large number of bad decisions in the market.

I’ll try to tell you what this leads to:

1. You buy $ XYZ for $ 0.25. You have studied the market, trends and the schedule well, therefore you are ready for risk. You don’t even try to “find the bottom” because you are making a long-term investment. cool.

2. 2 weeks pass. The price of $ XYZ does not change. You begin to doubt your decision. Logic and even reality itself is being called into question. The older generation comes under a hot hand when you argue with them about what money is.

3. Another 2 weeks pass. The price of $ XYZ drops to $ 0.20. Your friend, who got into the cryptocurrency topic a week ago, talks about some shitcoin’e called $ ABC. You laugh at him, not considering any other currency except $ XYZ. He buys $ ABC, and after 6 hours the price of this currency rises by 70%. A friend imagines himself the king of crypto investment and offers you his advice.

4. There comes a fatal moment in which you lose sight of the most important thing. Your strategy. You break down: “This market is meaningless if idiots like my friend win on it!” In the end, he traded only 12 hours, and has already grown by 80%. This is either a joke or an injustice.

5. The next day, $ ABC rises by 150%. You look down from the window of your house and think that after falling from a height it will be less painful than when listening to your friend’s songs about investment success. You go home and sell your $ XYZ stocks at a loss, moving capital to $ ABC.

6. The next day, $ XYZ grows by 800%, and a friend brings you congratulations, talking about the fall in the price of $ ABC to the level of three days ago. He says that he should adhere to your advice, and go into $ XYZ.

Protect yourself from such a scenario. Don’t be that person.

3. Do not look at charts all day

Believe it or not, you will not be able to make the line on the chart crawl up or down with the help of mental tricks. This is what many do and spend countless hours studying graphs. Honestly, such an activity is useless and can be replaced by something more valuable. It is much more productive at this time to delve into the topic of the market and learn new tools for working with it..

You yourself will see that most mistakes are made precisely at such moments. You, with hawkish vigilance, study the schedule, but remain unproductive. It sways emotionally.

Perhaps sometimes the best thing you can do is close the page with the chart. Trust your strategy and always remember – if you do not play the market according to strategy, you simply play a game of chance with guessing.

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Comments: 3
  1. Avalon

    What are the implications for investors when bitcoin experiences a decline? How does this impact the overall cryptocurrency market? What steps should individuals take to mitigate losses and navigate through a falling bitcoin market?

    Reply
  2. Sadie Murphy

    What are the three things that become impossible to do when the value of Bitcoin drops?

    Reply
    1. Nova Kelley

      When the value of Bitcoin drops, three things become more challenging to do. Firstly, it becomes difficult to make a substantial profit or return on investment when selling Bitcoin at a lower price than what was originally paid for it. Secondly, it can be challenging to attract new investors or buyers to purchase Bitcoin when the value is decreasing, as people are more hesitant to invest in a depreciating asset. Lastly, it becomes harder to use Bitcoin for purchases or transactions, as its purchasing power decreases with a declining value. Overall, a drop in the value of Bitcoin can limit opportunities for profit, investment, and spending in the cryptocurrency market.

      Reply
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