Towards the middle of 2022 the crypto asset market is in the red. Is it necessary to stop or continue investing in market conditions that tend to decline like today?
Crypto asset investors do not need to worry because the market is declining or commonly referred to as a bear market. Because things like that aren't always bad.
The decline in crypto prices basically occurs because there are more selling actions than buying actions by investors so that there is more supply in the market than demand. However, this massive selling action certainly occurred due to the negative sentiment that occurred recently.
I think the negative sentiment that caused crypto to decline the last few days was due to the Fed's policy of raising interest rates. This policy aims to reduce inflation in America which is soaring. Therefore, it is not surprising that the 'whales' (a term for investors who invest in crypto in large quantities so that the impact can be felt in the market) choose to sell their crypto assets and exit first.
Seeing the crypto market which is declining significantly, it is considered that investors tend to wait so that the movement of the crypto market itself tends to move slowly to bullish again. He provides trading tips that can be used when facing a bearish market.
First money management. This is very important whether the market conditions are bearish or bullish, trading crypto or whatever,
If an investor has good money management, however, market conditions will not affect him too much. In fact, if someone has bad money management, even when the market is green, he will not reap profits. So, someone needs to have good money management so that they can understand when to return to the market according to the budget and investment plan that has been made.
Then for the second tip, investors can also take advantage of this condition by buying crypto because the price is being discounted. This term is often referred to as buy the dip.
"This buy the dip condition is usually carried out by several institutional investors such as Microstrategy Inc or the country of El Salvador, which has several times bought bitcoin for its country's foreign exchange reserves when the price was discounted. After investors bought the crypto, investors could save and sell it when the price went up. later.
Because often when the market declines like this, there are times when the price of Bitcoin and others suddenly increases drastically and doesn't go down anymore. That is, a decline like this is still not too worrying. Analysts still mention that there is still a high possibility that Bitcoin and other cryptocurrencies will rise suddenly and drastically.
The market has experienced something similar before. If you look at historically, a bearish pattern like this will still occur and will most likely be followed by an All Time High again later.
By using the buy the dip trick, investors can increase their crypto portfolio. However, even though investors want to buy the dip technique, it is recommended that investors be careful, keep using cold money, choose crypto assets that have good fundamentals and have large capitalization, and stick to the trading plan that has been made.
Finally, investors can look at other crypto assets that are not affected by the Bitcoin price drop.
