Weekly highs and lows in the crypto market. Are you taking advantage of the specials?
There is a recurring theme I have noticed in the crypto market every week for the past few weeks. Every week at some point during the week the market looks like this on coinmarketcap.com:
Most of the coins, more than 90% of them are in the red, i.e. at a 24h low. And in almost every case this is followed a few days later by a similar picture but with all the coins in the green.
I like to look at this number though:
It seems like it likes to drop down to close to around the $90 billion total marketcap, and then climbs back up in the following days to +- $105 billion. That's a +- 15% potential gain each week if you try and buy during the low and diversify your investment.
What is happening here and why is there a drop? This could be because people want to try and take profits before the weekend and not have to worry about their investments while they take some time off. Some people see the market dropping and they panic and this drops the market even further. Others have stop losses they now start to trigger causing further drop and the cycle continues. Bv the end of the weekend or when a low has been reached people return to their trading and see massive specials and take advantage of the now undervalued market. People gain new confidence when green starts appearing all over. Also, cryptocurrency announcements often happen during the week creating a new positive vibe. Before you blink your eyes everything is green again and many try to jump in now at the new highs.
This is where allot of people go wrong. Why are they jumping in on the high and panic selling during the red? I have noticed this pattern every week and unless there is major news that warrants the weekly drops I will buy more during those lows. Personally, I see crypto as an investment and don't sell during the high, though I could do that too and make even more.
Do you take advantage of these weekly specials to buy more or do you panic and sell during the low? Do you only buy during the highs i.e. when everything is green?
Disclaimer: This is an opinion piece and should not be used as investment advice.
Lots of red there. Blood in the streets, but be greedy when others are fearful is my motto!
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Very interesting. Great article, especially for those that do daily/weekly trades :) Well done @munchmunch!!!