Why is the market preparing for a correction?

The cryptocurrency market is historically volatile, and periods of sharp growth are inevitably followed by corrections. In November 2024, the market shows strong growth: Bitcoin reached $93,000, and many altcoins are setting new local highs. However, there are signs of a possible correction:

  1. Market psychology: After prolonged "bullish" trends, investors begin to take profits, leading to price declines.

  2. Macroeconomic factors: An increase in interest rates is expected in the U.S., which may reduce liquidity in the markets.

  3. Technical indicators: RSI levels for major assets like BTC and ETH are in the overbought zone, signaling a possible pullback.

Signs of an impending correction

  • Decreasing trading volumes: This often indicates a loss of buyer interest.

  • Sharp pullbacks from resistance: For example, Bitcoin has tried several times to settle above $92,000 but has not succeeded.

  • Bearish divergences on charts: The difference between price and indicators (RSI, MACD).

How to survive a correction?

  1. Portfolio diversification
    Do not invest all your capital in one asset. Reduce the share of highly volatile tokens in favor of stable ones, such as BTC or USDT.

  2. Profit-taking
    If your portfolio has grown by 20–50%, partial profit-taking will protect you from losses.

  3. Using stop-losses
    Set automatic stop orders to sell assets if the price falls below key levels.

  4. Plan new purchases
    Corrections are opportunities. When the market drops, you can enter promising projects at a favorable price.

  5. Ignore the panic
    The market often recovers after corrections. Focus on fundamental indicators instead of emotional decisions.

A sector that may withstand

Some sectors, such as stablecoins, DeFi, or NFTs, may prove to be more resilient to corrections. For example, tokens that provide liquidity may retain their value even if the market falls.

When to expect recovery?

Historically, the market recovers within 1–3 months after a major correction. Watch for key support levels: for BTC, it's $85,000 and $80,000. If they hold, the market may begin a new wave of growth.

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