What is so scary about a decline?
1. Long cycle.
In terms of form, we can see that the most terrifying thing about a decline is that the "cycle" is particularly long. A short decline will last for a few weeks or even a few months, and a long decline may last for 1-2 years or even 3-4 years.
And although it seems that the decline is not large in the short term, if a cycle is extended, the decline of a decline will be more terrifying than a crash.
2. Large decline.
If we narrow down each small cycle, the decline of a decline is not large, but if we calculate a complete cycle of a decline, you will find that the overall decline of a decline will be much larger than the overall decline of a crash.
3. Retail investors are easily fooled by a decline.
A negative decline is a process that is very easy for retail investors to be fooled:
There will be rebounds during a negative decline, which can easily make retail investors have a fluke mentality during the decline, and thus blindly hold firmly;
A negative decline is a slow decline process, which can easily make retail investors "habitual" to accept small losses every day, but expect to get their money back, thus evolving into a "boiling frog in warm water" ending;
During a negative decline, the main force often spreads some good news to make retail investors mysteriously confident, and eventually turns into the result of "fellow villagers, don't leave";
4. The negative decline lasts for a long time, which makes retail investors lose their patience to wait for the bottom, and thus spend all the funds in their hands too early, and buy at the bottom at a high position;
Therefore, for retail investors, compared with the fierceness of the plunge, the negative decline is actually more cruel! !
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