The last few days have seen what amounts to FUD from Korea spur on a quite sizable drop across the board (more or less) for the crypto markets. We have seen this before. Those of us who are long time in the crypto scene are used to this type of market behavior, BUT this time it is a bit different as there are CONSIDERABLY more inexperienced people coming blind into the market and as we all know, they bring with them "weak hands".
Buying into a coin after a bull run like we have had the last months, with everything going only up and up, usually means that you bought at a premium or near all time high price. Drops like this will have such individuals in full panic as the "losses" will likely seem to be brutal and huge. I put the word losses in quotes, mainly because they are not really losses unless you sell at those levels.
This is the important bit: Its only a loss if you sell. (At a loss). The term you are all familiar with "HODL" (Hold On for Dear Life) is not just a meme. This is when it should be your daily mantra. If you are not in with HUGE money, but rather whatever you could scrape together, then now is a very dangerous time to be doing nearly ANYTHING. BTC is down, but so is everything else for the most part. A common mistake is for people to look at Coinmarketcap and check whats still in the green and sell for more "cheap bitcoin".
This methodology is sound, if you are experienced and have a large amout of the "green" coin in question, but the fact is that usually people are checking the page and looking at the column showing % gain. You need to realize that that is a 24 hour %-/+, meaning its up that much since YESTERDAYS price. (Which could have been down by a huge % then, thus a respectable gain might actually be only a partial recovery. You must expand column to the VIEW ALL mode as shown here:
This will give you a bit more relevant data like so:
Looking at Ripple in the expanded screen shows a weak example of what I am trying to show here. It was UP 0.93% but that was after a -40.42% drop before that. I realize that most of you know this, but I want to put it out there as I have talked with many new "traders" that had no idea about it. (Which is kind of scary in its own way), and I only bring it up to illustrate the real meaning for this post. What do I do when the market is down in this way?
I'll tell you: I do NOTHING. Why? Well when in doubt the safest move in crypto is USUALLY to just HOLD and wait for safer waters. Unless you are very experienced, the odds are good that you will panic sell something that you shouldn't, at a lower price level than you had planned, and regret it.
If you dont sell, it can, and (if history shows us anything) probably WILL go back up again if you just wait for the FUD to pass and the next burst of confidence to sweep in.
The rare times when BTC is down and ALTS are UP are a good time to cash out some ALT profits into BTC and wait for it to rise back to former highs at which time you will have much more buying power (more BTC) to buy MORE of the ALT coin you sold, but at a better price level. But if you are like most people, and you have already put in all you CAN put in, the temptation to sell off something to gain more funds. THIS is the move that you will often times regret.
Do proper research, buy into solid coins with good teams, real product, and usefulness, and SIT ON THEM in times like this. Dont FUD out and sell yourself short! If it was worth investing in to begin with, its worth holding on to now. ALL of these coins are in their infancy still. Even BTC. 2012 wasn't that long ago. This is all still brand new and nothing is past its prime and ready to be put to pasture.
Instead of panic selling or trying to play the market when it is going nuts, accept that things are down now, and there's little you can do that will not expose you to more risk. Take some time and enjoy your family, friends, or hobbies, whatever. Forget about it for a bit, check the general health of the market once a day if need be, but otherwise just HODL and Chillax. The market will swing the other way again and you will be able to get to some trading sooner than you think.
I wish you all the very best, see you when the graph swings the other way! I'm off to binge watch some TV shows I have been ignoring while glued to CoinmarketCap. You should too!
Peace and Happiness!
///Mike
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