Investing in the crypto market has for quite some time been the best thing one can do, as even with just a bit of knowledge and understatement of how this market works, you could make high profits. Now, due to recent developments, the value of these coins dropped significantly, which was a red flag for many. That brings us to the task at hand – what to do during a volatile bitcoin market. So, let’s explore some of the best options.
Avoid panic selling
It’s pretty understandable why this is the first thing we will mention, as people often tend to make a decision based on fear or the unknown. Now, the latter is an even bigger issue, especially with digital assets and cryptos, as even though cryptos have been with us for more than a decade, many are still unaware of how this market works. Knowing this, it’s nothing unusual that they also don’t know what affects the value of cryptos and why the volatility is so high. On the other hand, those who have a bit of knowledge regarding these coins are well aware of how they can use this volatility to their benefit.
Selling any assets simply because of several bad reviews and false predictions is never a good idea, and this gets even more emphasized when it’s about BTC, as its value can only go up. We must add that selling to avoid any possible losses is understandable, but that doesn’t mean that you should sell all BTC you have, as smart investments are what the crypto market is all about. So, make sure to sell only to save your initial investment, and then spread your further investments into several coins so that you can maximize the overall profits once the market starts rising again.
Know when to trade
The best advice anyone could give you is to avoid trading when the market is so volatile, but we understand that such high volatility also means that there is much more chance to make big profits fast. That is why before you start trading during such market conditions, make sure to learn how the market behaves under these circumstances. Namely, the goal here is to avoid making any trades during the first and last hours of the trading session, as this is when the market is the most volatile, and in such a way that it’s extremely difficult to predict how and when to make any decision to your benefit. Another thing to keep in mind is to try and make more automatic decisions, meaning that you are less reliant on making the right choice in the heat of the moment, and this is where scaling can be of much help.
Make a long-term plan
Okay, this is something of a must regardless of what type of investment we are talking about, but many still look at cryptos as something where they can earn big fast, which is why having no backup plan is such a common thing. Now, to avoid stressful situations, there are two main things to keep in mind. The first one is that the crypto market, as it is, is so highly volatile, even without these recent developments, and the second is having a long-term plan regarding the future of your investments in this market. On the other hand, in order to be able to create such a plan, you need to learn the basics so that you can evaluate what the future might bring. In this situation, bear markets typically have periods when the market drop by more than twenty percent, but these periods are short, which is why it’s highly recommended to ignore these drops and to remain focused on the things that matter, which is your initial long-term plan.
Just wait for a while
Although it is almost impossible to predict whether the BTC price will go up or down, no matter how many different articles and research we read, it is certain that it changes rapidly. It is sometimes good, as we can gain profit in a short amount of time, but once the price starts to fall, it can be challenging to stay calm, as it can result in losing a lot of money. However, panic selling is not a solution, and if we sell everything we have for a lower price than it was when we bought it, we will lose money for sure. In that situation, it is always better to use the buy-and-hold strategy, and wait until the price is high enough, so you can make a profit by selling your assets. Sometimes it can be a few months or even a few years, but being patient always pays off in the end.
Always have an alternative
Bitcoin surely is the most valuable and most popular cryptocurrency, but thanks to the improvement of this market, we can find many others that can be a great alternative to BTC. Of course, they are also extremely volatile, as volatility is the characteristic of the entire crypto market, not only Bitcoin but investing in a few different ones can be a great solution to gain some profit. Of course, choosing the best ones can be pretty challenging, as new ones appear almost every day, and it is necessary to do proper research before the final decision. One of the options is to go with so-called stablecoins, which represent cryptos linked to some stable currency such as gold or fiat money. Thanks to the stable prices of gold and fiat currencies, it is less likely that the price of stablecoins will fluctuate like the price of cryptos.
However, proper research is a must for everyone who wants to make the best possible decision, and it is crucial to find reliable sources, which is much more difficult than it seems. If you do not know where to start your research and find trustworthy information, visit coincarp.com and learn everything you need to know about how to become successful in the crypto world.