The Crypto market crashed again should we panic? Remember what goes up will come down however the reverse is also true so sit back and enjoy the ride
Why the Roller coaster ride with crypto
Just like the general stock market share prices are often driven by people to help with their trading.
Day traders are a nuisance ( sorry guys) that can manipulate the price. Particularly when they are whales
moving volumes that upset the supply-demand channels.
However, it is a fact of a trader’s life and it is here to stay.
Forget that pain in the pit of your stomach and think long-term.
Crypto basics for those wanting to learn more
Short selling and future options
Many traders play the futures game where they take an educated guess at what direction the market will take.
They short sell and long sell and create movement in the turnover when they achieve a goal or fail.
Therefore if you have a very large position betting the market will go down you have every reason to pedal some rubbish to help drive that direction or lose a bundle of money
When the Press causes a move
This is sometimes done in ignorance and at other times to affect market sentiment and create a
fear tantrum among the more cautious traders.
The amount of FUD being pedaled on the market would have us all hitting the panic button if we did not know better.
Every day on YouTube and in the press, there are dire predictions of a Crypto crash however also
opposed by conflicting Hype on growth. So who do you believe?
Press announcement can create a sugar hit
There are all sorts of announcements that hit the market by the relevant Crypto AltCoin.
It may be a quarterly return, a big joint venture arrangement, system upgrade, or any sort of news that has had to be announced.
Unfortunately, these reports are often leaked before the average punter has a chance to act.
A recent disclosure in the market that typified all of this was in Tesla stock.
The Hertz effect
Hertz rental car group ordered a lazy 100,000 Tesla cars for its fleet. A Billion dollar deal. On top of that, they then stated it might double the order soon.
This is about 20% of the current car volume in one hit. A partnership, a large sale, and a bit of mystery that they are being on-sold to Uber drivers.
Of course, the Tesla shares went up and Hertz also capitalized on the news with a 43% increase in the share price. We all know that insider trading never happens however we would have all loved this news a few days prior.
If it was a straight line there would be no tomorrow
This is planned growth around fundamentals in-car deliveries and profit however never continually upward.
What a great place it would be at the bottom of a continual market increase. Hey, we see this regularly as a product skyrockets through the pricing barriers however everything has a ceiling.
There are limiting factors that control the market. For instance;
Etherium, Solano, and Cardano all share a similar market yet they have wildly different prices.
These are top 10 products and are widely accepted as value stocks.
Putting it in figures
Furthermore many are talking of Eth killers however reality is another thing
Etherium price today $4177 value $490 B however circulating supply 118 million
Solano $ 220 $58 b 303 million
Cardano $1.80 $59 b 33 Billion
As you can see the price is based on supply and reality. Etherium was first to the market and much tighter held.
They build their own limitations with supply.
Being scared of the Bitcoin generation
The crypto market is so new it brings a lot of ignorance with it
This market is yet to reach peak acceptance. Mainly because most people have very limited knowledge of the product. This means that they will be very hesitant to step near the doors.
Just the mention of Bitcoin will have eyes rolling through the back of the head like they have been hit with a hammer. Even continual proof only brings greater fear.
The future may be uncertain however a total collapse is Highly unlikely.
The trend is doubling every year
Whilst the race to the top is erratic the general trend appears to be a doubling of price every year.
The famous Kathy Wood of Ark investments has a five-year plan. That is she looks at where a shore or asset should be in Five years and acts on that.
Therefore daily trading is of no concern and even some of the big free falls don’t worry her.
If you bought Bitcoin at $60,000 this year;
- 120,000 in 2022
- 240,000 in 2023
- 480,000 in 2024
- 960,000 in 2025
This is right in line with the forward predictions being made so you could be a millionaire.
Finally, it is worth remembering that the Crypto market is relatively new and adoption is still some time away.
Conclusion
Don’t let the fear mongers get at you and only listen to advice from those that understand the market. Certainly not from the doomsday brigade.
None of this is financial advice as I am not qualified or able to provide this.
I aim to educate and open your mind to possibilities for the future.