You went to bed yesterday, you were happy. You already think of everything that you are going to be able to offer you with the profits generated by your cryptos. Of course, you still have to convert them in euros before it can spend, but it is a formality. You are asleep with a serene spirit, looking forward to you wake up the next day to see how your babies are well behaved.
In the morning, you check your wallet to know how much money you earned during your sleep. Because yes, in the crypto-currencies you can earn money while you sleep. But your face breaks down : you find the red anywhere. A sea vermilion ! The real Red sea is in front of your eyes. No !
What the heck does it have to happen ? The alarm clock is brutal. You refresh the page or your application, there may be a cache problem. Nothing, your profits earlier are evaporated, or even worse. What to do ? It goes on and on… does it sell ?
The market is not in a good mood – Source Pixabay
This feeling of panic, all of the novice investors in the crypto-currencies have experienced during their first correction. Here is a small guide to survive.
A correction, this is what, exactly ?
Here is the definition of a correction on the stock markets : “a correction is a decline of 10 % compared to the highest of the last 12 months “.
However, if this definition were to be applied to the market of crypto-currencies, we would have corrections every 2 days approximately. In this universe special, correction instead corresponds to a decrease of 20% compared to the highest of the last 4 weeks. But no matter. When it will happen and you will realize this immediately.
Why are these corrections ?
It does not necessarily need reason. Sometimes it just takes a impulse downward so that all the robots start to sell as if on the day of the last Judgment of the Bitcoin had arrived. The traders are human nerves are not very solid pick then not, margin calls accelerate the movement and in less time than it takes to say crash, it was panic. The corrections are nevertheless necessary in a healthy market. No asset constantly increases, in a linear fashion.
Will I lose my shirt ?
It is unlikely. If you have invested intelligently in a sum you can afford to lose, you have the luxury of being able to be patient, what the professional traders do not have.
Is this the end of the world ? Non – Source Pixabay
Is this not in the corrections that one can make the most money ?
If you have seen it coming and that you have sold before, of course. If you have nerves of steel and a brain that is insensitive to emotions, maybe. If it is important to buy when prices are low, buying during a correction remains complicated. The bounce of the dead cat, as they say in the jargon, is the trap par excellence for a correction. So, what to do ?
HODL, or keep your corners during a relatively long period of time, is the safest way and the less stressful of earning money on the crypto-currencies. The option that is wisest, if you have no more reserves to attempt to switch to the purchase by attempting to situate the bottom of the correction, is simple : do nothing.
Sooner or later, the market will eventually bounce back. This is especially true when one is experiencing an overall correction, as of the end of December 2017. It is of course different if one of your parts breaks down. In this case, you may need to you resolve to sell at a loss. But that is another story.
How can I protect myself against the corrections of the crypto-currencies ?
There is not much else to do. Bitcoin, despite the decline of its dominance, continued to make the rain and the beautiful time on the market as a whole. When it staggers, it is the market which is being shaken. And even if the boss stays on its legs, it can bring down everything around him.
We are so helpless in the face of corrections. They are part of the game, we have to accept that if something can jump by 100 % in a few days or hours, it can also plummet 30 % or more. As I’ve already said in these tips to get started in the crypto-currency, the most secure to survive a correction is not to touch anything. Disconnect-you, are going to take the air or go to the cinema. It should all be forgotten tomorrow.