Successful Tips To Research And Invest In Cryptocurrency
Cryptocurrency is an alternative financial investment that can provide financial freedom. One who understood the niche of cryptocurrency succeeded in making huge fortunes.
It’s incredible to witness so many financial investment options and schemes evolving and creating the potential ability to beat the inflationary pressure of diminishing wealth and multiply your income sources.
Becoming financially stable and achieving wealth creation has become a lot of easy by investing in Cryptocurrency, Mutual Funds, Equity market. All you need to know is that learn to master the technique of investing and trading in the capital market.
What lies behind the success of gaining good returns from cryptocurrency?
I share some of the few tips from my investing and trading experience in cryptocurrency.
#1 - Investing is Similar to the Stock Market:
Even though the crypto market has relatively higher price fluctuations compared to the stock market, observations show that the equity market and cryptocurrency have a firm coincidence in their price trends.
Forecasts for equity market indices like Nifty 50, SENSEX, S&P 500, NASDAQ and Bitcoin almost share a similar trend. The only exception lies in the fundamental ratios of the stock market that do not apply to the intrinsic analysis of the crypto market.
Knowing the market trend from such indices and correlating it with the price of Bitcoin helps to predict the overall bullish or bearish trend for investment decisions.
#2 - It’s all about timing!
Cryptocurrency has volatile nature when investing in returns. From a money market perspective, cryptocurrency has the highest volatility index that adds risk factors for potential losses as well as potential rewarding profits.
While making any buy or sell decisions, looking at the 24 hr market cycle and opening market time of the Equity market of different exchanges, volatility of prices is predictable to some extent.
For example, In Indian Standard Time (IST), it has been observed that around 8:30 pm, 5:00 am and 10:30 am, the volatility is higher in prices than at other times.
Such observations help to have accuracy in making decisions. Hence, as an investor, noting the timings of the crypto market is self-improving practice.
#3 - Know the Latest Market News:
Investors look for certainty when it comes to making an investment decision. When the risk involved is at the higher end, then every news coming in the market affects the prices of Bitcoin, Ethereum and Altcoins significantly.
As an investor, staying updated with the latest news is essential for understanding the fundamental cause of price fluctuations.
On some tweets and news affectation coming from Celebrities, some crypto assets pump or dump massively, making profit or loss for investors in a matter of hours.
Checking Twitter and other social platforms to understand the market trend reduces the risk of an unknown unfortunate loss.
To prevent such accidents of anticipating upcoming investment opportunities, it is essential to continuously read and check for crypto news, and economic market news.
#4 - Know the Chart
What distinguishes professional investors is the ability to read charts and forecast trends. Chart reading involves understanding candle stick patterns, chart indicators and knowing different time frames on having clarity of approach for the long or short term.
You can place buy and sell orders with the best timing and accuracy if you master the chart reading techniques. So better know key chart patterns like Head and Shoulder, Cup and handle, Bullish/Bearish engulfing, etc.
#5 - Use Wisdom of Crowd Technique
Wisdom of crowd technique is about knowing overall market sentiment by audience polls and what majority of people bet their moves.
Prices of Bitcoin, Ethereum and other Altcoins depend on supply and demand in the market and what people are willing to pay or sell. There is constant wrestling between buyers and sellers, either pumping or dumping the prices of crypto coins.
Using Twitter and social media platforms, advice from genuine experts and reading the chart helps to have an estimated trend of the winning side (buyer or seller) at that current moment.
However, the wisdom of the crowd applied by asking and referring to a few people and sources may not work 100% as the market does not function on the sentiments of a few people but the entire global population.
The Long-Term Vision:
Cryptocurrency is an emerging financial asset class in the infancy stage of adoption and will impact the functioning of the traditional financial system in a redefined way.
Some countries have legalized cryptocurrency as a tender to buy and sell goods. On another side, few countries oppose cryptocurrency seeking outright ban or regulation under strict restrictions because of its unknown nature.
What matters as an investor and trader is knowing the technology, and its mechanism and working with the proper approach of understanding and learning to become a successful investor.
Cryptocurrency itself is an innovation of removing traditional financial loopholes. With evolving tech and its adoption, 21st century will see a massive transformation in the daily financial health of every human.
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