- The recent crypto cash has made most of the cryptos trade low.
- The market has fallen from $1.7 trillion in May to $9.6 billion in October 2022.
- However, traders can grip on a few strategies to overcome the bearish moment.
The recent crypto crash in the summer of May 2022 put the market in red, specifically due to the fall of Terra Luna and 3 Arrow Capital (3AC). During the May-June period, global crypto slumped from over $3 trillion to $1 trillion. Apart from the aforementioned reasons, several macroeconomic factors, such as the Russia-Ukraine war andthe high inflation rate,shook the market vigorously.
Bitcoin has clicked its usual “red September,” this time also with a monthly high price of $22,789.2. This range is comparably low to the one in 2021 and high to that in 2020 and before. The master coin has dipped by more than 56% dip during the last two consecutive Septembers.
However, coins such as Ethereum signaled green at the moment before PoS Merge in September, but as several ETH holders were pessimistic about the transition, they liquidated the coin, making ETH go down for the day. Besides, Cardano also met new heights during its Vasil upgrade days.
To note, like the old well-known phrase, ‘after every storm, there is a rainbow,’ the crypto market would blink a good hope in an optimistic viewpoint.
There is a sardonic fact that crypto bellwether Bitcoin swings according to the traditional stock market movement. But some analysts like Cameron Winklevoss weigh in that the coin “has been remarkably resilient” in the past weeks of September, although the stock market dwindled, “losing trillions in value.”
Bitcoin has been remarkably resilient the past few weeks despite the stock market losing trillions in value. No idea if this is the bottom but there's been a curious decoupling. Are folks starting to re-examine the "disaster insurance" thesis?— Cameron Winklevoss (@cameron) September 27, 2022
Source: Market Cap During May 1-October 5
On May 1, 2022, the crypto market cap showed a $1.74 trillion range, which then went steeply down to $9.63 billion, as of now. Although the market surged on May 5 to $1.8 trillion, all sorts of macroeconomic features led it to nose dive until today.
Why There is a Bear Market?
In crypto, a bear market is a situation where the price of coins dips due to prolonged macroeconomic factors. Technically, if the market price dips by 20% or more from its recent high price, and surrounds by negative investor sentiments, it can be well titled as a bear market.
So, from the aforementioned analysis it is clear that the market oscillates in line with global economic factors, and what crypto enthusiasts can do is to learn from the crash by following some crypto strategies.
Resilient Traders Can Easily Survive a Crypto Crash
The basic quintessential thing a trader must keep in mind is to thoroughly understand the market trends or patterns. Knowing what makes a coin hike or dip, analyzing what pattern follows a downtrend, and considering trustful predictions would definitely help traders to withstand the bear market.
Having patience is very vital during a crypto crash. If traders are looking to buy from the dip or find it too hard to accept, always be calm and think forward rationally.
This strategy is important because several market trends move according to the investors’ sentiments.
There are people who always look for the bottom price. Although experts do technical analysis, their predictions would not always get right and it is investors’ own responsibility to get things right in their hands.
The traders should have a gut feeling to play through the dips, avoiding pessimistic concepts.
This trading strategy helps traders to buy any coins in small amounts regardless of their price. Although this is a long-term process, it is very simple because, for instance, a trader can buy a coin for $50, every week, instead of investing $300 at once.
More so, traders can schedule their DCA occasionally according to their requirements.
Crypto shorting is a strategy that traders use to earn profit by selling coins with the prediction that the market may go bearish in the future. Experts find that shorting or short liquidation can lead to severe market losses because when an investor does so, there is a chance for heavy liquidation of their position.
In times of market downtrends, traders can rely on staking passive income. Staking is the process of earning rewards by locking or storing a coin for a specific time on a proof-of-stake (PoS) blockchain.
Disclaimer: The views and opinions, as well as all the information shared in this price prediction, are published in good faith. Readers must do their research and due diligence. Any action taken by the reader is strictly at their own risk. Coin Edition and its affiliates will not be held liable for any direct or indirect damage or loss.
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