Bear markets typically strike fear in investors, as they connote periods full of uncertainty and pessimism.
28 Jun 2022, 15:08
Bear markets typically strike fear in investors, as they connote periods full of uncertainty and pessimism. Although the price declines seem prolonged and endless, it is important to bear in mind that they are a natural phenomenon in any investment cycle – even in cryptocurrency.
To navigate the wilderness of the crypto bear market, knowledge and the right skills can illuminate your way forward. The following steps will equip you with effective bear marketing strategies to embrace bear market trading without being weighed down by doubt.
A crypto bear market is a period when the value of major crypto assets like Bitcoin falls by at least 20% from their previous highs and remains at that value due to fear and a gloomy outlook. It usually plays out in the following four stages: recognition, panic, stabilisation, and anticipation. Although it can be difficult to tell when a crypto bear market is starting, some tell-tale signs include, such as; ow trade volume due to extreme fear, bearish technical and charting patterns, collapses of major crypto projects.
While it might seem natural to stay out during such volatile times, crypto bear markets often present the best buying opportunities for long-term investors. If you are a beginner, you can look at diversifying your overall portfolio by investing in blue-chip cryptos and projects with solid fundamentals. You can also use dollar-cost averaging to mitigate market timing risks.
During a crypto bear market, it is important to gain a sense of the overall market sentiment and where the market is expected to head. According to crypto bear veterans, tools like the Fibonacci Retracement method to determine support and resistance levels have proven to be essential to investors in such times. To find out more about his bear market trading strategies and tips, read his Bybit Bear Stories, where he breaks down key concepts such as leverage trading.
For a specialist take based on notable trends happening in the crypto space, Bybit’s bear market report offers timely insights for investors looking to make the most of their circumstances. From revealing on-chain and off-chain activities to exploring how investors can weather the bear market with DeFi, its bear market analysis will help you better gauge the market’s health and aid you in your decision-making process.
Investing safely and smartly