Bull Run Basics
I am sure we can all agree that not only Bitcoin, but the entire cryptocurrency market is in a full blown bull run. The market is seeing drastic rises in current market prices of many cryptocurrencies and more and more new people are flocking into cryptocurrency everyday.
This is a great thing for the cryptocurrency space, but can also be dangerous for many who may not understand entirely what they are doing and underestimate the risks they are taking. So, whether you are brand new to crypto or have been in the space for a while, below are 4 tips to help you navigate safely through this bull market.
You may be wondering, what does bull run or bullish even mean. It is a term used across all markets of a time when the market is seeing constant rising of market prices across assets in that class. The opposite, bearish or bear market, refers to times when a market asset class is in a downward trend in pricing. There are ways to make money both ways, but you have to develop those skills to be consistent.
First and foremost, you need to avoid the FOMO, or Fear Of Missing Out, and not chase pumps. FOMO can cause you to jump into a trade or make a buy when the market has seen a pump in price and usually is followed by a dip or pullback in price. Even in bull markets, nothing goes up all the time. There are periods of retracement where prices pull back to previous levels of support before moving higher.
Using the Moon Lines tool in Newscrypto can help you identify support and resistance levels as you want to do more buying at support level and not as much when right under resistance levels. There are many other aspects of technical analysis you can use to make better trading decisions, but start with the basics.
If your strategy is not to trade in the short term and just buy and hold, it would be best to have the mindset that if you make a purchase of any crypto and then it dips, your strategy should be to accumulate more in those dips. Again, this is mainly if your strategy is just a long term buy and hold. This will allow you to increase your holding and lower your cost basis, which in turn would have you in profit sooner when the market prices move higher.
When it comes to trading, the most basic of trading strategies is to buy low and sell high. That is easy in theory, but hard to time when trading a market. If you are trading, avoid entering trades after a cryptocurrency has pumped drastically in price. Our basic human emotions want us to jump in and not miss it, but to trade we must learn to control our emotions.
Second tip is related to the first tip and that is to either reevaluate your strategy or decide what it will be if you do not have one. If you plan to buy and hold for the long term, then it is not wise to check the price multiple times a day as you are not trading the dips and spikes in price. If your plan is to accumulate more on the dips, then you can set alerts based on either hitting a specific price or in terms of percentage drops within a day to alert you of buying opportunities.
For instance, I teach people that if you are buying Bitcoin, Ethereum, and others at current level near their all-time highs, you should also be prepared to buy more if the price drops 10%, 15%, or even 20%+. Zooming out on the charts within the Newscrypto platform and looking at past market movements, you can see these volatile swings can happen at any time so preparing for them is your best strategy.
If you are a trader, make sure you are using stop losses and also have your take-profit level or levels identified before entering trade. In a bull market, many will enter a trade without those identified and potentially give back all potential profit when the market pulls back because they felt the market would continue to go up. You can easily be blinded by greed or a false sense of confidence due to trades you may have ultimately just lucked out in making. Remember this, everyone can think they are a genius in a bull market because almost everything is going up. But if you want your profitability to be sustainable, you must learn how to enhance your trading skills and you can learn to make money whether the market is going up or down.
The third tip is to be leary of scams and scammers that become more and more prevalent in a bull market. Greed in the market is high and scammers will attempt to lure in unsuspecting victims and prey on that greed. Scams, although they have evolved over the years, all have serious red flags to help you identify them. Even some old methods of scamming come back during bull markets due to the influx of new investors and traders. First and foremost, make sure you only trade on legitimate exchanges.
Coingecko has a trust rating system for all exchanges if you have any doubt about one. You will want to make sure you avoid any suspicious exchanges. Also, scams we have seen in the past and are emerging again that revolve around others trading for you, sending money to a company to have a “bot” trade for you, “smart contract” money multipliers, and cloud mining contracts are all examples of scams that prey on people who are looking to make easy money in the market by doing nothing.
Be sure to avoid any that utilize any of these methods. There are legitimate trading bot companies, but they never require you to send your crypto to them. They use what is called an API key to set up and your crypto never leaves your exchange account. Most of the others mentioned should also raise red flags when they guarantee a certain percentage return either daily, weekly, or monthly, and in many cases, the percent returns are way higher than what is actually possible if it were a legitimate program.
To add to these scams, some will even ask for more money when you try to withdraw, saying it is a necessary fee to withdraw. This is just another scheme to get people to turn over more money to the scammers. Cryptocurrency allows you to own and control your money. Do not turn that over to a stranger over the internet or a company with a fancy website. When in doubt, reach out to those knowledgeable in the space if you have questions about a program's legitimacy.
The fourth and final tip is to become a student of the market and of the cryptocurrency space if you want to have long term, consistent success. Many right now are filled with way too much confidence but at the same time are ignorant on most things they need to know about trading and investing in the crypto market. Everyone can be a genius in a bull market.
The ease of selecting a cryptocurrency to invest in or trade and having it make serious gains are as easy as guessing if the sun will come up today. Stay humble and remember to continue learning and growing. Develop and enhance your strategy and it will allow you to have great success no matter if it is a bull market or a bear market. Nothing goes up forever so be prepared for the market to pullback and you can capitalize on it, rather than cry over it.
Dig in to all the tools within the Newscrypto platform, Newscrypto app, and the blogs on Newscrypto page to continue to enhance your skills and your knowledge. For trading practice, test your strategies as you develop them on the trading simulator. You have to ask yourself in a bull market if your trades outperformed the market, not just if you made a profit. Along the way, you may have doubts or questions, so make sure you are part of the Newscrypto telegram group, https://t.me/NWC_PublicChat , and if in doubt, go to the tutorials section under school and click the “Ask Crypto Coach” button.