6 Things To Do During A Crypto Dip
Over the last couple of days, the prices of several cryptocurrencies have fallen significantly. However, you must understand that a dip is no longer new at all in the crypto space. And when it happens, rumors, sentiment, and fundamental developments are rapidly factored into the market. Sometimes, you are uncertain about what action to take —whether to buy, sell, or wait. But worry no more because, in this article, we came up with 6 things you could do during a crypto dip.
Now you have to stay focused
The idea of staying focused in a bearish market is to enable you to make the right decision. It might seem like a no-brainer. However, individuals who master their emotions in a bearish market, profit from the investment process. Yes, it is not easy to hold your nerves and watch your portfolio plummet by the hour, but the dip isn't unusual for these assets. Cryptocurrencies are well known for their volatility, and freaking out will not change anything.
Avoid blaming others
My brother I hope nothing oo
Why are you even venting your frustrations on people when you should be praying to God to preserve the remaining assets you have? A lot of people tend to pour out their anger on fellow traders who have no hand in a bear market. For example, someone introduced you to Bitcoin, and for the past months, you've been enjoying the bliss and frequent profits from the market. And suddenly, when there is a red market, you seek ways to drag them to the mud. Yes, it can be nerve-wracking for a new trader looking to get started but even if you blame people, it would change nothing.
Buy the dip
Yes, buy the dip
Whenever there’s a dip, the idea is to buy the dip, and when prices return to their previous highs, the dip buyers will bank profits. However, this is where a lot of people miss it. There is a way to buy the dip if you are unsure. The best way is to adopt the DCA method —Dollar Cost Averaging. This strategy involves breaking up your reserve funds into smaller trenches and making several trades over time. Let's say, for example, you have $1000 in reserve funds, all you would need to do is break up the amount into 5 tranches of $200 or 10 tranches of $100 and place your trade using those smaller amounts. Since you don't know when an asset has bottomed out, it would be unwise to trade all your money at once.
Say NO to FUD
Information is great in the crypto space. Traders thrive on information, but you must trade carefully and do your own research (DYOR). In a market downturn, it is easy to FUD. FUD is a common crypto term that means Fear, Uncertainty and Doubt. It is regarded as negative market sentiment, often triggered by internet rumours or prominent figures in the crypto space. And oftentimes, traders sell off their assets hoping for a price decrease. In a bearish market, avoid falling prey to FUD.
Stay with the community
During a bear market, people tend to exit some crypto groups on social media. This is mostly out of frustration and anger. But that is actually the best time to stick with fellow traders, get the latest news and know what line of action to take. Those crypto groups are there to encourage and make you feel better, even when your portfolio seems to plummet. Always remember that "Only the strongest is immune to the dip". Master your emotions and stay with the community.
If you have read up to this point, then you must be positive. Stay positive and anticipate a green market soon. It's a new month, sit back and watch your portfolio smile again. Be positive that your assets would soar and if you'd bought the dip, then it would pay off in no time.
It is always expected of a financial market to have a correction in the form of a dip. However, this comes with an emotional response from those who have their assets in the market. This response can lead to wrong decisions that may lead to further loss. It is important to master these emotions and follow the steps above to survive through a dip.