4 Things to Avoid When Bitcoin is Dropping
The cryptocurrency market is one of the most unstable ones, which is why such investments can be very risky. The value of all cryptocurrencies, including bitcoin, constantly varies, which means that at one point it can be very high, but in a short period it can fall. With each drop in value, a serious psychological war will be waged within you and that’s why it’s very important to be mentally disciplined so that, instead of having a panic attack, you can react properly at the moment. If you stop thinking rationally in a situation like this, it can lead you to the wrong steps that will make the current situation even more difficult. So, you must control your actions and continue to follow the strategy that you adhere to from the beginning.
As in any other business, in this case, you often have to be guided by personal intuition, which isn’t always so meaningful. However, the steps you take and the decisions you make should later lead you to the desired goal. The first step on this path is to find reliable trading software. Allin1bitcoins thinks that finding the perfect software solution doesn’t have to take much time at all.
When you sit and watch the value of your stock decrease, it’s hard not to get upset. But sometimes, even when it seems like there is no way out, it doesn’t have to mean that the problem arises because of what you don’t do, but because of what you do. If you are interested in how to avoid mistakes that can occur when the value of your Bitcoin decreases, pay attention to the following paragraphs.
1. First of all, avoid stress
Panic hasn’t helped anyone so far. The fact is that none of you can expect to be completely calm when you realize that you can lose the money that you have successfully stored for a long time in your digital wallet. But, surely someone warned you at the beginning that you enter this game at your own risk and that you have to accept the rules and come to terms with the fact that the crypto market is very unstable. No one can guarantee that you will end up as the winner. So stop for a moment and think about what it would be wise to do and don’t let negative emotions overwhelm you, but try to think rationally.
On the other hand, this is a good sign that this isn’t the right time for investors who are considering directing their financial resources to this market. Therefore, first of all, it’s necessary to do a good market analysis and be well informed about the current situation and whether it’s favorable or unfavorable for joining at a given time.
2. Don’t wait for the moment when the dropping happens
If you are already a part of the whole story and you find yourself in this uncertain situation, you must learn to deal with it. Experts believe that in the event of market failure, it would be good to have some capital invested in Fiat or BTC and start compiling a portfolio.
On the other hand, in the event of a drastic drop in value, many will want to wait until the fall reaches its final limit, and the situation with Bitcoin begins to improve. In other words, they are trying to “catch the bottom”, which isn’t the smartest decision because it can lead to losses.
Many will constantly wonder when it will stop, trying to wait for the right moment to close the trade. Trying to close the trade at the bottom of the downward trend is rather difficult, almost impossible. And while you’re just sitting and waiting for that to happen, you can miss the right moment to succeed.
There are many examples of investors who lost a lot of time and money waiting for the trend to reverse, convinced that the right time to react is yet to come. Trying to be perfectionists, they missed much more than they gained. If you are planning to trade while it seems that everything is going downhill, it’s recommended that you don’t wait to catch the bottom, but just get closer to it.
3. Don’t sell your coins in exchange for those whose value is growing
Another mistake that should undoubtedly be avoided is the thought that you may have made a mistake when you decided on Bitcoin because day by day you’re looking at how to take the lead over other cryptocurrencies that you thought were far below Bitcoin until yesterday. Don’t worry, this is a normal first reaction, but don’t let this feeling hold you for long. This common fear can cause you to make bad decisions that won’t help you in any way.
Once you notice that nothing is changing day by day, things are only getting worse, you’ll probably wonder if Bitcoin trading was a smart decision, if you were well informed and analyzed the market and you will start questioning the correctness of everything you opted for at the beginning.
You may have a friend who has been trading another cryptocurrency that is currently dominant in the market for a long time. You may have laughed at them at first, but now it’s becoming less and less funny as the entrance path of his Ethereum or Litecoin seems quite intriguing.
And while your friends become convinced that they’re masters of cryptocurrencies, everything starts to lose its meaning for you and you seriously start thinking about another solution that involves trading with some other coin.
If you allow these thoughts to conquer you, you’ll probably regret the step you took because it is by no means correct. Very soon when Bitcoin takes the lead, you are going to realize that there was no need to take such big steps and that you were wrong. Don’t do that!
4. Obsessively looking at charts won’t help you much
The whole situation that seems so hopeless anyway…you can still make it worse if you obsessively review the charts and try to telepathically force them to move. You will probably spend hours drawing, analyzing, and planning what steps to take next to get out of the current collapse with as little damage as possible. The practice has shown that this generally has no productive purpose or goal and that it can only lead you to make even worse mistakes. Experienced people advise you to simply set a limit and leave, and that is perhaps the smartest thing you can do.
Observing a declining curve is by no means pleasant. However, it is very important to react correctly to avoid unwanted situations that can put you in an even worse position than the one you are in – so listen to the above tips and spare yourself the extra stress.