Getting started with Cryptocurrency: The things you won’t hear from an expert.
The cryptocurrency market has risen again from ashes to the spotlight of the public and media. I have been active in the market since 2015, but it took me 6 years to understand the market and write this article for you. Summing up all my experience, I’m writing to help those who are trading cryptocurrency in disguise.
Since its inception itself, unlike the general public, cryptocurrencies have drawn the attention of the government and authorities thinking as a curse to society. You might have heard news or allegations against bitcoin or any cryptocurrency then, but now it is receiving a hugely positive reception from the same people who once turned down them. This radical shift has taken cryptocurrencies towards the mainstream market. So keep in mind we’re not one among the early adopters of bitcoin anymore.
Existing in the cryptocurrency market is really easy, but finding success isn’t. There are few basic things you need to succeed in the market, that is what I’m going to explain here.
1. The Bitcoin Bull Run: Major Phase of the Cryptocurrency Market Cycle
As you can see in the above chart, bitcoin follows a four-year cycle, during which it rises from the dump of the previous cycle to a New All-Time High (ATH) price of bitcoin, after which it enters into a bear market.
The first leg of the four-year cycle is right after Bitcoin Halving — an event that occurs periodically to reduce the reward for mining Bitcoin transactions in half. Due to this event, bitcoin supply reduces which makes it more precious for the future. Hence, basic supply & demand economics kicks in and the price of bitcoin increases exponentially.
This is then followed by Bitcoin Bull Run, which may last a year or less, where there will be a spike in bitcoin price, as well as the prices of the altcoins. Once Bitcoin reaches an All-Time High we can expect the bear market to enter. In a bear market, traders are more likely to sell than to buy, but let’s now focus on the bull run.
The bull run can also be viewed as follows,
This cycle of the crypto market can understood as the following, where the cycle begins by accumulating bitcoin for fiat currency. Then, after the bitcoin halving (bitcoin gains more value), we can slowly buy the altcoins for bitcoin. Once bitcoin reaches an all-time high, where it dumps, sell your bitcoin for altcoins, and wait for the altseason to end. During the altseason, buy back the bitcoins and sell the rest to fiat.
2. Altcoins always follow Bitcoin; and The Bitcoin Dominance
Bitcoin is the first cryptocurrency in the market, all the other coins or altcoins (alternative coins) came into existence because of Bitcoin. Hence, there exists a correlation between bitcoin and the altcoins, this has also resulted in the calculation of Bitcoin Dominance.
Bitcoin dominance is the ratio between the market cap of bitcoin to the overall market cap of the overall cryptocurrencies in the market. This simply explains where the traders are more focused on, the fall in dominance makes altcoins raise against bitcoin which is also known as the altseason. It’s during the altseason people make the most of their returns from Crypto, often the massive pump of altcoins happens by the end of the bull run. The coins usually perform more than 10x during that time.
Every fall in bitcoin dominance brings mini altseason during the bitcoin bull run.
3. The Path To Mega AltSeason
During the bull run, we can see mini altrun where the low-satoshi coins performing 10x to 20x, but there will be the experts of the crypto who keep bragging about the Altseason. The following chart explains how the alt season will come.
The altseason is due to the inflow of money from bitcoin to altcoins after bitcoin reaches a very high price from the previous cycle’s low price You can keep your coins till the altseason or safely sell for the price you have gained before this run because it’ll last only some days and the chances of FOMO are more.
4. Control your emotions while trading
The cryptocurrency market is highly volatile and unstable, no one can deny that. Hence, controlling your emotions while trading is a must, once you succeed that, there won’t be a turning back to the red days of the market.
You will win the market when you realize, FOMO( Fear of Missing Out) and JOMO(Joy of Missing Out) don’t help you in the process, instead, HODL(Holding) can do wonders.
5. Fear and Greed Index
Now you have known, it is important to have your emotions controlled, there is a unique indication in the cryptocurrency world, that shows you the market sentiments. In which the fear indicates the investors are worried, which is an excellent buying opportunity and the greed indicates the investors are greedy, which means the market could go to correction mode.
https://alternative.me/crypto/fear-and-greed-index/
6. Stop following the crypto influencers
You should be selective about the news/tips/signals that you hear while you are actively trading in the market. There are a lot of scammers, whales, and influencers who are looking out to manipulate the market by pulling the crowd in the wrong direction. Be disciplined in the trade you make.
After all, make sure you sell it when you hear the news. Because, “buy the rumor, sell the news” is one of the key strategies to make a profit in crypto.
7. Trust in the process
If you are ready to take all the risks to invest your money in the process, why don’t you have some faith in yourself? The market cycle itself is a 4-year journey, you need to be calm like a saint till you make it to the bull market.
Once you are in the bull market, things will seem like a paradise, sometimes even as hell, but the end will be worth it. If you can’t be present in the market, just leave it till you hear the ATH rates in the news, that will definitely help you out.
Of course, you should analyze and rectify your mistakes and learn from them, but it doesn’t mean to quit from which you once believed that it can be attainable. You can make millions out of crypto if you do it right, but you need to have the right mindset for that, otherwise, you can lose everything in an instant too.
Cryptocurrencies are getting more attention; brings new traders who come with no idea of the market often tend to get burned in the process, I’m writing with the hope that you can understand how the market really is. Hope this helps.
