Surviving and Thriving The Crypto Bear Market
As the crypto market continues to drop, people in the industry, especially those who have invested a lot, are having the dilemma of whether or not they will pull out all of what they have invested over the years. However, it has also proven that the crypto market bounces back after every drop or crash — and they do it big time! The crashing or dropping of the crypto market is called by industry pioneers as The Bear Market.
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.
The start of 2022 has been absolutely brutal for crypto investors. Bitcoin has plunged to its lowest levels since July 2021. Other coins, like Ethereum, Cardano and even Dogecoin, have followed suit.
To navigate the wilderness of the crypto bear market, knowledge and the right skills can illuminate your way forward. Good investors know how to deal with bad times just as well as good times. Here’s a guide that will equip you with effective bear marketing strategies to embrace bear market trading without being weighed down by doubt.
Spotting a crypto bear market
A crypto bear market is a period when the value of major crypto assets like Bitcoin fall by at least 20% from their previous highs and remain 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:
• Low 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.
Reading the market’s direction
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 veteran and Bybit affiliate Daniel from Chart Champions who has more than a decade of stock and crypto trading experience, 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 bear market trading strategies and tips, you can 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.
Invest safely and smartly
Bearish seasons may seem bleak, but every cloud has a silver lining. Even in a downturn market, there are always windows of trading opportunities that allow you to grow your crypto assets with minimal risk. Trading products such as Bybit Savings and Dual Asset can support you in trading safely and smartly using low-risk strategies.
These products could earn stable yields by staking coins and tokens like USDT and BTC with competitive and guaranteed APY. It supports flexible and fixed terms so you can generate maximum returns based on your investment time horizon. For those risk-takers and are confident with short-term speculations, Dual Asset could net you high returns in markets with low volatility, with APYs reaching upwards of 100%. All you have to do is predict the direction of a specific crypto asset within a set timeframe and it will do the work of maximizing your returns.
The news, research, analyses, and other information contained in this article are provided as general market commentary, and do not constitute investment advice, recommendations nor should be perceived as independent investment research. Investing in the bear market poses high-risks. Do in-depth research and seek advice from experts to avoid major financial loss.
Vivid | How to survive the crypto crash
The start of 2022 has been absolutely brutal for crypto investors. Bitcoin has plunged to its lowest levels since July…
What is a Bear Market and How Can You Survive (and Thrive) in It? | Binance Blog
Bitcoin's fall from $64,800 in mid-April 2021 to $31,100 in early June may signal a bear market, which means bad news…