How to trade Bitcoin and altcoins during a bear market

How to trade Bitcoin and altcoins during a bear market

How to trade Bitcoin and altcoins during a bear market

The crypto industry has proven to be one of the rapidly growing industry from the beginning of the pandemic until today. Every day  more people are selecting to invest in cryptocurrencies by making an account on an exchange or  virtual wallet. And the number of entrepreneurs investing in the crypto industry with their new ideas is increasing day by day.

It is estimated that ten percent of the world’s population has invested in cryptocurrencies worldwide, around billion people.

Markets are currently in a state of uncertainty and while the situation is likely to get worse in the near future, that doesn’t mean  investors should sit back and watch from the sidelines. There is no doubt that history has shown that one of the best times to buy Bitcoin (BTC) was when nobody is talking about it.

It’s been hard to find anyone, including the mainstream media, speaking positively or negatively about cryptocurrencies right now.

During this period of sustained downtrend and sustained sideways trend, savvy investors stocked up during this period to prepare for the next uptrend to come.

The fact is, nobody knew “when” this parabolic surge would happen, but the example is just to illustrate that while cryptocurrencies could be in a crab market, there are still great strategies to invest in. in bitcoins.

During A Bear Market, There Are Three Ways to Trade Bitcoin And Altcoin:

                                   Of course, no one knew “when” this parabolic surge would occur, but the example is just to illustrate that cryptocurrencies could be in a crab market, but there are still great strategies for investing in Bitcoin.

Let’s see all three.

  • Savings by dollar cost averaging

When it comes to investing in long-term assets, being independent of prices helps. A price-agnostic investor will continue to identify and add to his positions some assets  that he believes will be immune to fluctuations in value. If your project has good fundamentals, strong and active use cases, and a healthy network, it makes more sense to adopt the Dollar Cost Average (DCA).

Two years ago, an investor who used DCA to buy $50 worth of Bitcoin weekly over a two-year period is still making profits today, and with DCA, there is no need to trade, monitor charts, or get emotional Expose the  stress that comes with trading.

  • Trade the trend and go long off extreme lows

In addition to consistent and reasonable cost averaging, investors should also build a dry powder reserve fund and simply sit back and wait for the next generation of buying opportunities to emerge.

It is usually a good idea to enter the market when it is severely oversold and all metrics are in extreme regions.

This is often a good time to open long cash positions, but preferably with less than 20% of your own dry powder.

It’s time for investors to look around when assets and price indicators are
two or more standard deviations from the norm.

It’s not uncommon for traders to zoom out on a three-day or weekly timeframe to see when assets correct to higher timeframe support levels or earlier all-time highs as a signal to invest.

In addition, there are other traders looking for rates to turn key moving averages like 118 DMA, 200 WMA and 200 DMA back to support.

Either way, gap spot longs throughout extreme sell-offs typically seems to be an honest swing trade or maybe entry purpose for a multi-year-long position.

  • Do nothing until the trend changes

When the market is in a bear market, trading can be difficult and capital and portfolio preservation are paramount.

Because of this, some investors may find it better to wait for confirmation of a trend reversal than to try to predict it.

A good trader knows that “trend is your friend,” which means that every bull market trader is a genius. So if that was you, then wait for the next bull market. and then he can be a carefree genius then.

It is well known that downtrends, consolidations and bear markets are notorious for stalling traders and reducing the size of their portfolios. Therefore, it is not advisable to trade against the trend unless one has experience in short selling and knows how to trade the trend during bear markets.

Cryptocurrency investors shouldn’t live in a vacuum when it comes to monitoring the stock markets, as it’s important not to live in a vacuum.

Traders in the crypto space tend to focus their attention solely on the crypto markets, but this is a mistake as there has been a strong correlation between the stock markets and BTC and Ether (ETH) has given.

By looking at the market structure and price movements of the major stock indexes, we gain important insights into the strength and duration of any uptrend or downtrend Bitcoin can exhibit.

tags: How to trade Bitcoin and altcoins during a bear market, bitcoin and altcoins, relationship between bitcoin and altcoins

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