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Bitcoin (BTC) Remains In Strong Uptrend Despite Recent Sell Off
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Bitcoin (BTC) Remains In Strong Uptrend Despite Recent Sell Off

Bitcoin (BTC) has held on to its uptrend despite the recent sell off which has once again instilled fear in the market. The bears have once again become louder in convincing amateur investors that a $3k bottom is coming and they need to get out of the market. A big move is about to come and some fear that if this move is to the downside, it may take BTC/USD down to $4,000 or lower. Fearing that, many of them are waiting on the sidelines although they do believe in the future prospects of Bitcoin (BTC). It is going to continue to look like the price can fall further till the very last moment when the price starts to shoot up. By then you may actually realize that you were wrong but it would be too late to buy.

The only way to make a good return on investment in any market is to buy low and sell high. When the price is low, people are not going to be happy. The sentiment is always going to be negative when the price is low. If the sentiment is positive, it should be a cause for concern because you don’t want to buy when everyone thinks the price is going up. Similarly, you don’t want to sell when everyone and their cousin thinks the price is going down. This is called herd mentality. The majority of people lose money in financial markets because they trade on sentiment. You should definitely take sentiment into account for long term investments but then you have to look at the long term sentiment. The question to ask would be, “Do people believe in the long term potential of Bitcoin (BTC)?”

Chart for BTC/USD (1D)

Long term sentiment can be a very good indicator of future interest in market and where it is headed. However, short term sentiment can be very misleading. The mistake most people make when investing into Bitcoin (BTC) is that they forget what they are doing. You have to be very clear whether you want to invest for the next few days, weeks, months, years or even decades! If you are investing for the next five days, you are going to need a strategy that is completely different from the one you would need if you were investing for five years. So, most of the people waiting on the sidelines are thinking, “Let’s wait some more, the price may fall to $3k”, but they forget that they are in it for the long haul. If they were investing short term, they wouldn’t be waiting, they would be trading.

A lot of people seem to think that they can time the market. They believe that for some reason they might be able to tell when exactly the market is going to turn and they also believe that they would be able to fill their bags when that happens. Most of us who have been in this market for long know that this is a very unreasonable approach. Investors with this type of mindset and approach to cryptocurrency investing often miss out on rallies. Later on, they FOMO in when everyone is buying which is usually very close to the top.

 

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Fakhan

I work as the key Trading Analyst for Crypto Daily and provide the team with regular analyses and updates regarding the technical performance of all cryptocurrencies on the market. I am responsible for the production of articles and posts for Crypto Daily’s own technical analysis section and spend my time monitoring and commenting on the varied moves the markets make on a daily basis.

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