For May 1-27, bitcoin has fallen in price by 34% and at the time of writing its price on the Binance crypto exchange is $ 38.9 thousand. authorities to tighten regulation of mining and cryptocurrency trading, writes RBC Crypto.
Despite this, Bitcoin is still in a bull market and is on its way to the $ 100 thousand mark, says Bloomberg strategist Mike McGlone.
Experts explained what to do for investors who entered the market before the collapse of quotations.
The market is changing
Recent days have shown that everything can change very quickly from positive to negative and vice versa, says Andrey Podolyan, CEO of the Cryptorg.exchange crypto exchange. According to him, the main positive criterion is the entry of funds and corporations into the cryptocurrency market. Their investment horizon is much larger than that of the average static investor, the expert explained.
If the initial investment goal is long-term, then the investor must have a plan of how to act in this or that case. As a rule, investors keep free capital for averaging and buying at those moments when the market is strongly declining, noted Andrey Podolyan.
He believes that with a long-term approach to investing with a horizon of 1-3 years, there is no point in selling in any panic, otherwise a long-term investor turns into a speculator-trader. The expert advised long-term investors to look at the trading terminal less often and not to make transactions without a clear plan.
Long-term investor tools
Market participants who open positions with a horizon of several years should use three tools: a price change chart for a month, a logarithmic price scale and an analysis of the entire price history of an asset, Vitaly Kirpichev, Director of Development for the TradingView platform in Russia, advised.
“This will allow you to see the global trend without distortions associated with the transition to disparate price areas,” the expert explained.
There were times when bitcoin cost a few cents, then hundreds of dollars, and now it costs tens of thousands of dollars, reminded Vitaly Kirpichev, and the logarithmic scale “equalizes” all these periods of time. According to him, the historical trend is still unshakable, and the correction cycle has always been accompanied by a subsequent renewal of price highs.