Oct 03, · The chart below shows the past 3 Bitcoin market cycles, which consist of bull markets, bear markets and accumulation phases. Based on this Author: Anthony Bertolino. Dec 14, · Bitcoin’s Current Market Cycle Is “Average” For what will soon be a year, Bitcoin has been going through an extended hangover from the exponential rally of . With Bitcoin specifically, using the terms that describe the phases of a market cycle from the above chart (not official terms, but useful terms) it might look like this: Smart money, institutional investors, early adopters, etc accumulate Bitcoin low (they accumulate during a lower period that looks like anger and depression to those who held.
Bitcoin market cyclesLookIntoBitcoin | Charts
Euphoria — the sustained bull run is reaching its peak. This is the point where everyone wants a piece of the asset. The press is getting worked up just like other investors. It is where most money gets into the cycle. Some people would even leave other assets to get to this. Complacency — the first signs of a stop in the bull run shows.
Most traders, however, are too invested to believe any other possibility except a rise. They end up assuming that it is a slow run before the rise gets back to normal. Anxiety — this is the point when the realization that at some point, prices will go down.
A small downturn on the value marks it. However, traders are not letting go. They can hold on as the reductions are on a low scale. Denial — the traders have already sensed the effects of the downturn. The assets are dropping rapidly.
The traders are, however, still hoping for a market correction. They tend to believe they cannot be on the wrong side of the market. Panic — after denying the market situation for someone, the traders suddenly open up to reality. The bear run is the reality, and losses are unavoidable. The traders don't want to lose everything.
They end up selling out of fear. Capitulation — not everyone sells at panic. Some tend to believe the market can still salvage. After some time, they realize they lose a lot while holding the coins for longer. They sell, thinking its now a free fall. Depression — at this point, the traders don't care about the markets anymore. They have lost all hopes in the markets. However, it is also the point the market starts to rebuild to start from stage 1.
The Depression stage might last for an extended period. The whole system can be summarized in short as accumulation, greed, distribution, fear, repeat. The duration of the cycles is not any important. Whether it runs for weeks, months, or several years, the cycle remains the same. Bitcoin currently seems to be on the belief market cycle stage. Most traders didn't imagine it would run against the falling traditional economy.
After a sustained value increase, they started hoping it beats the slump. Afterwards, they wanted it as the best alternative investment. For now, they trust the coin would bounce from any market issue. Understanding the market cycles is just half of what you need for successful crypto trading.
You need more to learn crypto investments. The first hurdle is emotional control. You are human and falling to the pressure is part of you. You will always have the urge to move with the masses. The whale traders have mastered the art of using emotions. They can create a market decline which the other traders follow.
They end up buying the assets at lower prices for accumulation. The market cycle helps you rely on data rather than emotions. Stable emotions also help to stay calm even when on the losing end. Once you master the emotions, the second step is to learn more. Consider learning from the other successful traders—research more about the market movements from other research and studies.
Remember, market cycles can end. Not every asset stays up forever. Some diminish never to make a return to the market. You have to know whether the market is on the cycle or ending. It seemed like it was headed to the deathbed. Such long slow times are quite hard to distinguish. It takes a little bit of craziness to keep assets when every signal indicates a lull.
Still, in Bitcoin's case , it seems the crazy ones gained more than any other group. Understanding the bitcoin market cycle is a must for any serious trader. You have to analyze the market to determine the perfect time to buy or sell the coin.
However, market cycles in itself are not enough. It would help if you had other tools like technical analysis to understand the real market state. The right tools are the best for successful trading. Like this article.
I have lost lots of money testing them for over an year. Since its inception, the coin has been on a high G20, in its most recent announcement, has unveiled that there will not be any new regulations in Privacy is one of the top-selling points for cryptos.
There is a need for privacy in digital Transaction costs and speeds are the ever-present phenomena in crypto. Most users are looking Risk warning: Investing in crypto takes time. Besides being a new medium of exchange, several coins available Sweden, the country of innovation and testing, now is testing and innovation again by launching What Is Ripple?
Risk warning: CFDs are complex financial products. They have a speculative character. Trading in But, despite the despair, the price is actually finding a floor. And this floor will be the springboard for the next stage of the market cycle.
Disclaimer: This information is not financial advice, and should not be treated as a recommendation to buy or sell. It is to be used for educational purposes only. Kieran Smith is a content marketing consultant at Bitcopy.
He provides content strategy and copywriting for blockchain and cryptocurrency companies. Bitcoin Rush Review — Is it a scam or legit? Bitcoin Code Review. The Psychology of a Market Cycle As a nascent market with few real fundamentals, the cryptocurrency market is driven primarily by sentiment — human emotions Feelings—from deep depression to euphoric mania — compel traders to buy and sell assets in an emotional cycle.
The Stages of a Market Cycle Disbelief After a market crash, the first signs of a recovery are hard to believe. Hope and belief As prices rise up from the bottom, investors become more hopeful.
Thrill and euphoria In the next stage, the bulls take full control of the market. Complacency As the price pulls back from the parabolic curve, new investors are not too concerned. Anxiety and Denial As the price continues to swing lower, investors start to lose their cool.
Capitulation and depression In the final shakeout, the retail investors give up and sell their investments in desperation. November 4, July 21, May 29, Leave A Reply Cancel Reply.