- How to react to a massive dump in cryptos -
How to react to a massive dump in cryptos
Fluctuations are normal and healthy, but when suddenly things are changing, currencies start tumbling and your portfolio is already down by 15%, it becomes frightening. Then, you finally realize that it's Bitcoin falling down, dragging with it the whole market in its dump. It's a panic, you rush to sell to recoup your gains or limit your losses, and even if it's already too late, you will at least "save your losses". This is the most common classic reaction in such a situation.
Volatility in crypto world is powerful, recurrent and unpredictable. An official announcement, a rumour, an attempt at manipulation, whales, the value of BTC are all reasons that can cause major capital movements.
If you're investing in Bitcoin for long term, you won't necessarily look at your wallet every day, you may not even notice all this because it only lasted a few days or a few weeks maximum. Your crypto investment is in a personal wallet (software or hardware), it does not linger on trading sites, you are serene and confident in your investment. But..
What is the right decision when you're on a trading platform and a crash comes to shake things up?
Do nothing. This is by far the safest position to adopt, especially in the event of a crash. You let the storm pass... Even a banker would tell you that.
Make your stack bigger
It can be a profitable practice if you have a clear idea of the currencies you own. You have an estimate of their intrinsic value, you measure their potential, and you have an up-stream knowledge of the project. Those that have a strong, singular concept and solid technology are generally those that are likely to regain their value most quickly.
Buy The Fucking Dip !
Any currency at its bottom has to be considered. The idea is to estimate the margin between the potential value and the current value of money. The larger the margin, the stronger the growth potential. Says, if following a general dump, Ethereum goes from 300 to 200 $ and Radium from 80 to 20 cents. The observation is that Radium can make x4 when Ethereum regains 1/3. That is the question. This example is just an illustration.