- Bitcoin continued to decline approaching the $20,000 mark, pulling altcoins with it.
- The bear market phase is not over yet, and that scares investors, especially beginners.
Today we will look at tips to help you survive a bear market and wait for a bullish phase.
In a rapidly falling crypto market is not the best time for averaging and trading, it is better to keep some cash reserves in fiat to buy at lower prices. If it pains you to watch your balance decreasing on the exchange or crypto wallet, change your assets display from fiat to BTC/ETH and try to accumulate these assets as much as possible.
Explore other cryptocurrency earning opportunities such as staking. You can make money from crypto assets through more than just trading. At a time when it’s not making the former profits, cryptocurrency earning services such as Binance Earn can provide an alternative for your portfolio. Place cryptocurrency in a stack – you won’t be trading it anyway, waiting for markets to recover! You’ll soon see your assets grow in line with your annual percentage yield. It’s as high as 20 percent for ETH 2.0 staking and 26 percent for GLMR staking. There are also many other profitable cryptocurrency products available to you, with rates much higher than bank rates.
Buy at the bottom
“Buy at the bottom.” This is one of the main mantras in crypto trading. “Buy at the bottom” means to take advantage of low prices as profitable entry points into a bear market. The trader who chooses this tactic believes that it is only a matter of time before prices recover from a fall to a certain point, and hopes to make a good profit. However, avoid “falling knives.” Finding a real bottom is not unlike trying to “catch the falling knife,” that is, buying a rapidly depreciating asset near a recent bottom in anticipation of a quick recovery.
Remember: in most cases, “falling knives” end up hurting your portfolio. As with any trade, exercise caution. If you really want to buy, you can buy in small increments as the price of the asset decreases. For example, after each 5 percent drop in BTC price, you can buy 5 percent of the free fiat assets you allocated for averaging. This bearish strategy is called “ladder”.
Buy Stablecoins. Let’s face it: most crypto traders still measure cryptocurrency trading gains and losses in fiat: dollars or local currency. Consequently, in a bear market, it is sometimes wise to lock in some profits of your crypto portfolio in stabelcoins and avoid possible losses. In the future, you can exchange some more fiat reserves into stablercoins to prepare for the coming market recovery.
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Learn short selling
There’s an old saying: the market goes up the stairs and down the elevator. It means that markets go up slower than they go down. A bear market is just as good for shorts as a bull market is for longs. Learn how to use this tool, but the main thing is not to get carried away and do not use too much leverage in order to avoid liquidation of your position, and remember that shorts and margin trading have higher risks for your crypto portfolio.
Related: Crypto market bloodbath: Bitcoin (BTC) can further tank to $20,000, Ethereum (ETH) to $1,000