During A Bear Market, Here Are 3 Ways To Trade Bitcoin And Altcoins

Share Market Daily Writer By Mahesh Limbani Published September 3, 2022

There is no doubt that everyone is a genius during a bull market, but how should one trade in a bear market?

When investing in assets over the long term, it's helpful to be price agnostic.

Dollar-cost averaging accumulation

Price agnostic investors can withstand fluctuations in value and will identify a few assets that they believe in and add to their positions.

It makes more sense to dollar-cost average (DCA) into a position if the project has good fundamentals, an active use case, and a healthy network.

The investors who auto-purchased $50 in BTC every week for two years are still in profit today, and DCA eliminates the need to make trades, watch charts, or experience the emotional stress of trading.

When the market is deeply oversold and all metrics are extreme, it's a good time to open spot longs, but with fewer than 20% of one's dry powder.

Go long off extreme lows and trade the trend

It's time to start looking around when assets and price indicators are two or more standard deviations away from the norm.

As a sign to invest, some traders zoom out to a three-day or weekly time frame to see when assets correct to higher time frame support levels.

Others watch for price to flip key moving averages back to support, such as the 118 DMA, 200 WMA, and 200 DMA.

When buying at extreme multi-year lows, on-chain fans usually follow the Puell Multiple, MVRV Score, Bitcoin Pi indicator, or Realized Price indicator.

When buying at extreme multi-year lows, on-chain fans usually follow the Puell Multiple, MVRV Score, Bitcoin Pi indicator, or Realized Price indicator.

It is important to preserve capital and portfolios during a bear market. Due to this, some investors prefer to wait for confirmation of a trend change.

Until the trend changes, do nothing

During a bull market, everyone is a genius and a superb trader, so if that was you, then wait for the next bull market and be a happy-go-lucky genius.

As downtrends, consolidations, and bear markets can chop up traders and reduce portfolio size, trading against the trend is unwise unless you have a PNL positive trading method.

Cryptocurrency traders should not focus exclusively on crypto markets because equities markets and Bitcoin and Ether (ETH) prices are closely correlated. BTC or ETH charts, Dow Jones, Nasdaq, S&P 500.

The strength and duration of any bullish or bearish trend that Bitcoin might exhibit will be determined by the market structure and price action of the largest equities indexes.

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