#Altcoins are in a bull cycle, but how to handle flash crashes?

Today has shown that altcoins are super volatile.

They are able to drop by 10% when $BTC sneezes.

They are certain strategies that you can follow through those times.

Let's discuss flash crashes on #Altcoins. ⬇️

The markets are trending upwards, however, the sentiment can change in the blink of an eye.

Some bigger altcoins have been running upwards by more than 200% in a single week, erasing the bear market of the past three years in a single week. Don't get me wrong. We're in the same stage as in 2020, through which the sentiment is still overly bearish and therefore, the potential expectations for peak bull market valuations for those altcoins are also ridiculously low.

I don't expect Bitcoin to peak at $150K, I rather expect Bitcoin to peak at $500K and I tend to believe that we'll have a longer cycle due to the insane amount of liquidity being added to the markets + the trend switch on macroeconomics yet to happen.

Now, back to altcoins.

➡️They are super illiquid and when the sentiment is positive, people tend to overleverage themselves on illiquid assets to make more money.

Simple.

This means that, once the markets are rotating, the long positions are getting liquidated/stopped out, however, the liquidity that comes back into the order books through those forced sells is way larger than what the markets can absorb.

Especially in an event where Bitcoin makes it standard 5-10% correction on a day to take the liquidity on the long side.

This is likely going to cause a chainreaction across markets with deep wicks of corrections of 20-40% on the markets for altcoins.

That's where they come from and that's what I mean by 'flash crashes'.

What are strategies for those periods?

1 - The best thing is to be patient and to accumulate your altcoin positions NOW. In this accumulation period is the easiest period to be building those positions as the markets haven't gone vertical, yet.