When the cryptocurrency market changes, you should do the same.
Some people are happy when they make a 3% or 4 % return in the Bitcoin market. As for me, that doesn’t work at all. That would actually irritate me.
Personally, when I see a big crash, I want to at least double my investment. You should do the same.
I am not a financial analyst and have learned everything by just watching the market. My college degree had no effect to help me read the market. So you don’t need a college degree to do this.
The math is really simple and you don’t need to understand chart analysis except for some basic fundamentals.
1. When the market crashes, you need to have the money to spend.
While investing, always have a stash of money on the sidelines. You never know when the market crashes unless you’re a Bitcoin Whale. I’m sure some of these Whales talk to each other from time to time.
As the market crashes, you’ll have money to put back in the market. Sometimes it’s tempting to buy Bitcoin or another cryptocurrency. You have to wait until the market settles a bit.
I’m not a chart guy, but go with feeling when I invest. I normally take a quick scan of the market. Bitcoin is usually the key indicator to follow. When Bitcoin moves up or down, the rest of the market usually follows its lead. There will be the unicorns that do their own thing from time to time.
2. Analyze your favorite cryptocurrencies.
Once, the market has settled, you should have some cryptocurrencies you like. See how much percentage-wise these cryptocurrencies have fallen.
If a cryptocurrency has fallen only a few dollars or about 20%. You want to pass on these cryptocurrencies. You want to look for a cryptocurrency where you can really make money.
Yes, you could make a couple hundred or thousand dollars when the cryptocurrency rebounds. When you chase these cryptocurrencies, you are limiting yourself. There are bigger returns out there.
3. Look at the previous all-time for the cryptocurrency.
When you look at the charts for your cryptocurrency, look at the previous high. My guess is the cryptocurrency will touch or possibly surpass that high.
This is not investment advice but what I have done for years in stocks and now cryptocurrencies. Stocks are a little different but the principle is the same.
You want to buy good quality cryptocurrencies that dropped because the entire market crashed. So when the market recently crashed, I did not buy Dogecoin or Ethereum Classic. These cryptocurrencies do not fit my plan. These cryptocurrencies will most likely reach their previous high but as I mentioned, you want to buy good quality cryptocurrencies.
4. Once you find cryptocurrencies that meet the 100% criteria, then you buy.
When the market crashed, I narrowed my picks down to two cryptocurrencies.
I bought Ethereum (ETH) and 1Inch (1INCH).
When I look at a cryptocurrency after a crash, I’ll look at the previous high and low. I narrow the search down to the past 7 days and then the past 30 days to get a better overview of the cryptocurrency.
For Ethereum, it had a high of $4,376 in the 30-day chart and bottomed at $1,895.47 in the 7-day chart. Sometimes you have to adjust your view to find what you’re looking for.
Screenshot of Ethereum
It is hard to time the bottom when investing in cryptocurrencies. Not many people can. As long as you’re close, that’s what counts.
I bought Ethereum at $2,592.43.
Ethereum is close but didn’t meet the 100% criteria. This is a gamble but I expect Ethereum to surpass its previous high.
For 1 Inch, it reached a high of $7.89 on the 30-day chart and a low of $2.65 on the 7-day chart.
Screenshot of 1Inch
I bought 1Inch when it was $3.61.
1Inch passed the test and should reach it’s all-time high for a 100% return.
When you invest in cryptocurrencies, you should always have an exit strategy. Staying in the market too long you could lose your investment.
Following my advice does not guarantee you will always see a 100% return. The market could decide to crash tomorrow similar to the 2018 crash. A lot of investing is being in the market at the right time.
There is a lot of uncertainty about the future of the cryptocurrency market. With big business involved, they could play the same game the Whales have done for years. Big businesses could sell and cause the market to drop.
As the market is trying to correct, prices will trade sideways until you’ll see a steady rise in the market.
See these other articles on cryptocurrencies.