November has been a pretty bleak month for cryptocurrency, the markets are hitting new yearly lows and for the first time in a very long time, we are witnessing a huge shakeup in the state of the markets. At the time of writing, XRP now sits above Ethereum by market capitalisation as Stellar now sits above Bitcoin Cash. The top end of the markets have been rattled, in a sentiment that has continued throughout. This marks a major incident, one that is leaving investors feeling a little deflated.
What does this mean?
Well, firstly if you look through the news, you’ll see a stream of reports stating that this is the time to buy. Of course, by definition what we see at the moment are very cheap prices, meaning you can buy Bitcoin for a low price and you can purchase EOS for a low price too. Let’s also bear in mind that we know Bitcoin has the potential to hit $20,000.00 and we know that EOS has the potential to hit $20.00, so now seems to be a sensible time to buy - you have the potential to get the very most out of your money.
What we should consider however though, does what you see in the markets today, really make you want to buy cryptocurrency? If you’ve never bought before, perhaps it’s worth taking a little gamble? If you already own crypto though, do you really want to risk anymore of your money on a market that has failed to perform for nearly 12 months?
What we see today and what we have seen through the past month is the pure essence of volatility. The cryptocurrency markets are very volatile, meaning investment is very risky. Just because prices are low now, it doesn’t mean that prices will fly back up again - indeed, if prices do fly, great, you’ve taken a good return on your investment, but you should be aware of the fact that prices might not fly back up again. So, when we tell you to only invest what you can afford to lose, this is what we mean.
Should I buy now?
So the real question, should you buy now? If you have money you can afford to lose, perhaps - there is a chance you’ll make a profit. However, please do remember that we are not investment advisors, therefore I would never actually recommend you invest, instead, what I will recommend is that you use the falling markets to inspire you to do further research, check out current prices and check out historical trends. Keep up to date with the news and keep your eyes on what is going on throughout the entire industry. This way, you can ensure you are best informed and can make educated investment decisions, that will hopefully enable you to see a return eventually.
What will happen next?
We all want to know what will happen next here, in order to determine if the markets will recover. Remember, we’re not experts, so this is just speculation, however, this is what we would like to see happen:
Bitcoin dominance currently stands way over 50%, therefore we know that Bitcoin has a grip on the markets. When Bitcoin moves in any given direction, the rest of the markets are likely to follow when dominance is so high. So, what we expect to see is Bitcoin start to recover (probably through correction) and in turn, we expect the rest of the markets to pull up too. Bitcoin could well climb back towards $6,000.00, when it does, the rest of the markets should continue.
Moreover, when the markets crash like this, we generally see a bull run initiate just after the end of the crash - this is generally down to a manic buying spree, so, with prices low, lots of investors will start to pump cash back into the markets, causing value to spike once more.
None of these scenarios will push Bitcoin up to $20,000.00 anytime soon, therefore don’t expect the next bull run to be the ride of your life, instead, just keep your eyes out for the signs that it might happen.
Overall, our advice is this - research well, keep your eyes on the prize and ensure you are trading in a safe manner. This is hard evidence that the cryptocurrency markets are volatile, it’s a tough industry to be involved in, one that really is full of surprises.