How to manage a situation that is objectively difficult and which worries many investors in Bitcoin and cryptocurrencies.
The long-awaited cryptocurrency crash has arrived. Bitcoinwhich was the best of this phase, lost 10%, the rest did much worse. The causes start from the world of traditional finance – and have caused havoc in a world, the Bitcoin and crypto world, where movements are generally amplified.
But can we protect ourselves from the worst? What to do now? How to move? We will answer all these questions during this in-depth study, taking advantage of a wake-up call that has arrived for many for the first time, and for just as many for the umpteenth time, liquidating portfolios and positions.
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Losses are the best of lessons
We know that these are very harsh words when you open your wallet and see losses of even more than 20%. However, we also know that before experiencing losses, few people take into consideration moderation tips that we have been writing on these pages for years now, so on Bitcoin as on the rest of cryptocurrencies.
- Even 5x leverage is EXCESSIVE in the cryptocurrency world
Cryptocurrencies are extremely volatile. It is not uncommon to see runs or corrections of more than 10% in a few hours. It is also not uncommon to see movements of 3% in a few minutes.
This, multiplied by 5, or even just by 3, means exposing yourself to instant losses of up to 50%. The lever should be used, in this case, only with great moderation. And only for short periods and if we know exactly what we are doing.
It is not a good idea to move with leverage haphazardly, hoping that the next bullish move will make us rich. On the contrary, it is the best recipe for burning everything during the bull run.
The composition of the portfolio is not important, it is the only thing that matters
We think we have a fair amount of experience in the world of cryptocurrencies. And thanks to this experience we compose the our public portfolio extremely unbalanced towards Bitcoin and Ethereum. And it’s not that we don’t want to enjoy the incredible booms of less capitalized cryptocurrencies, but it’s a strategy.
Read the contents of the Criptocurrency.it portfolio here.
It’s a wallet you can take home with you every day incredible gains? No. But it’s still a wallet that can protect yourself when there are days (or more days) like the ones we have faced over the last few 48 ore.
Timing is important
And it doesn’t mean searching obsessively the best moment of entry: no one succeeds with any regularity and spending energy to have the perfect entrance is often an exercise futile.
In the short and very short term, very in-depth analyzes are necessary for those who trade. On the our Premium Telegram channel the analyst Alex Lavarello it offers you this type of inputs and outputs, but it is not the only strategy you need to implement in order not to lose (which is the first part of a profitable experience in the crypto world).
For the rest, in the presence of events that we report to you as high volatility It’s best to mind your own business if you’re trading short. And it absolutely is NOT RECOMMENDED operate with financial levers that multiply volatility that is already enormous.
And now? What to do?
Count the damage, understand where you went wrong – and apply 5 tips that have already helped us while we were having our first experiences on the crypto and Bitcoin market:
- Put the desire to recover quickly out of your head
You have lost, you see your wallet in the red and the desire to recover dominates your every thought. But this means being in tilt – and therefore make less than rational decisions. If you want to up the ante to try to recover faster, think twice. Then think about it twice more. And then let it go. Defeats like those of the last 2 days are the right time to start thinking about it how to not make it happen again what happened.
- Think about your portfolio
Here too, however, our advice is to think with the coolest mind possible. You lost more than 10%, which is more than the most solid of the troop lost, i.e Bitcoin? It’s time to think about how your portfolio is made up. Is it balanced? Did you follow this guide?
- Remind yourself how much you can afford to lose
Have the losses caused you excessive anxiety? Have you had any sleepless nights? Are you sure you have allocated the right amount of money in these investments? Are you sure you didn’t exaggerate?
Crypto investments – and we say this against the interest of the industry – are very volatile and risky. And the percentage of our capital to be allocated must be considered.
- No adventures, not even in bull runs
When there is the scent of the bull run, every adventure seems like a challenge that we can overcome. And instead, it is precisely in bull runs that greater care must be taken, because corrections can hurt us, and cancel out any gain accumulated in the phases of positive movement.
- Sitting still for a while isn’t a bad thing
We know that the crypto market is fast-paced and always calls for action. However, when we are not in a position, staying still is a more than smart option.
For the rest, get help in managing these moments on our Official Telegram Channel. There is a lot to learn in the crypto world – and these events, if interpreted correctly, are the ones that lead to growth.
