How to handle bear market, specifically in crypto.

euricsanti (27)in #cryptocurrency • 6 years ago

Most investors don’t know how to handle bear markets, mostly newbies… Today I bring you a guide to read before taking action on bear market.

Don’t panic.

In the first thing you must be clear is, never panic. Panic leads to anxiety and anxiety leads to bad decisions. As an investor you must be cold hearted when it comes to taking action on your assets, mostly on bear markets.

Panic is your worst enemy on bear markets, hence: DON’T PANIC.

Keep trusting the math.

One plus one will keep being two, even on red candlesticks. The math never lies, even when markets seem to go the opposite side of profit. If the math tells you to hodl ,do it. But also if the math tells you to sell, do it. Trust the math.

See, I didn’t say your math, i said.. the math, meaning that is the math what you must trust, not your unique calculations… expand your reach research wise, use the markets to educate yourself more on the assets you hold and how are they being handled upon possible upcoming risks, which leads to my next point.

Look closer to the projects you’ve invested.

Bear markets are the best opportunity to test on projects, why you may ask? Well, how team and development handles that pressure will tell you what to do on short/long term with that investment.

If the team and their wallets are quite normal, if they don’t pay attention to market and keep working like is a normal monday. No need to worry. If the team starts talking diligently about the market and shows panic on how the things are going… look closer and turn on notifications on that.

In any way you most look closer to the product itself, because sometimes the team just… shows themselves strong, while they are not; leaving investors side blinded while getting out as fast as they can. What brings me to my next point.

Research what’s going on and what’s triggering the bear market.

This is the math you have to trust. One plus one, will be two. There are always reasons behind every dip, the question is, does that reasons affects the projects I am invested short/long term?

You have to look at the bigger picture, if the reason of bear market affects directly the expansion or growth in the project you are invested… you might consider getting out. But do your research, keep up to date by the second on news and updates.

Sometimes… you can’t hodl

The most common word when the market is down on every community is: hodl. Am… that’s not always a good option, if you are losing too much, you might have to get out to avoid full loss.

This is an unpopular opinion for community managers, don’t hate me folks; sometimes you can’t hodl you have to sell. You don’t debout to any community you debout to your money and your money only, this is not a friendship space, even communities make you feel that way; everyone is in it for the profit “tech”. So if you have to sell because the math says you must, just do it: avoid loss.

Of course, do your research, and take my points into account:

Don’t panic;
Keep trusting the math;
Look closer to the projects you invested;
Research what’s triggering the bear market;
if you can’t… don’t hodl;

Buy more?

There’s always this option to “buy more” when the market is down, but… be careful not every shining asset is gold. You might end up with a ton of stupid invaluable things after huge buy’s on bear market.

Yeah, it might be a big opportunity to buy cheap, but… don’t just buy, buy, buy; also research, research, research. Is important to invest on what will give profit mid-long term, if not… what’s the point right?

Conclusion

Yes, this is considered to be a financial advice, but don’t blame for your stupidity. You are responsible for your actions, be a grown up.

And of course, is never late to state that you can follow all the steps and calculate all you want and still get rekt. Markets are volatile and stupid sometimes. So… be ready for everything and never invest more than what you can lose. Of course is good to find pointers, but at the end of the day… things can get crazy.

Disclaimer: most of this points are to be consider on mid-long term investment, for money making machines and quick trading… maybe in another post, but those are basically gambling, unless you are a whale.