A new round of panic has begun. Are you scared?
With the market crashing yesterday and today, many people are getting anxious again, possibly wondering: Has the bull market already left? Is there no hope in the cryptocurrency world? Watching the money in their accounts decrease day by day is really hard to bear. People start worrying that the market will continue to drop, feeling shaken and even considering whether to cut their losses.
Some people might regret thinking how great it would be if they sold at a high and then bought back when the market dropped. However, during bad market conditions, people's emotions tend to be low and filled with negative thoughts. In fact, everyone must adjust their mindset and not let short-term fluctuations affect long-term decisions.
Looking back at history, just like the prolonged downtrend that lasted half a year this year, we all got through it. After experiencing such a significant drop, no matter how bad it gets now, it can't be worse than then. Usually, before a major market trend arrives, the market will first undergo a round of consolidation. The purpose of this consolidation is to allow those blindly following the trend to throw away their chips, providing better buying opportunities for institutional funds.
Boost confidence, look at history
Come, let's give everyone some confidence by looking at historical data:
In January 2021, it rose by 14%, and in February, it rose by 36%;
In January 2022, it dropped by 16%, and in February, it rose by 12%;
In January 2023, it rose by 0.03%, and in February, it rose by 22%;
In January 2024, it rose by 0.62%, and in February, it rose by 43%;
In 2025, what will happen? Let's wait and see!
Looking at historical data, BTC rose by at least 20% in February. Now that the market is correcting, could this be a great opportunity to gradually buy the dip? Just wait another month, and by February, you will witness a wave of price increase.
Regarding the news: $6.5 billion worth of Bitcoin for sale
On January 9, there were reports that the U.S. Department of Justice received approval to sell $6.5 billion worth of Bitcoin, which could also be a reason for the market decline. From a news perspective, in the remaining time, Trump hasn't taken office yet, and he cannot interfere with this matter, so this batch of Bitcoin may be sold soon. It seems that the sellers are in a hurry, but Trump had promised not to sell this Bitcoin. Therefore, even though this is a short-term negative news, it doesn't need to be overly concerning in the long run.
Once Trump officially takes office, the market's digestion issue may not be significant, and it might instead become an opportunity. After all, in the cryptocurrency world, risks and opportunities always coexist.
The patterns of rise and fall in the cryptocurrency market: consolidation and rebound
The fluctuations in the cryptocurrency market are often characterized by 'slow rises and sudden drops,' usually occurring during market rebounds or upward trends. In simple terms, this is an old trick of a bull market's consolidation.
A coin rises for several days, then suddenly experiences a sharp drop, causing the gains of several days to vanish. This way, new investors and those who cannot withstand the pressure will become afraid and sell their coins. This is the effect that institutional funds hope to achieve: to let the chips held by retail investors flow out.
Once the market drops to a certain level and stabilizes, the coin price will slowly rise. When it reaches a certain height, more investors will follow suit, and institutional funds will act again, using a sudden sharp drop to clean out some chips. Such sharp drops are usually quick, lasting a short time, and may fall by 5%-10% within a few days, sometimes deeper, even dropping 15%-20%. However, there's no need to worry too much; prices generally stabilize near important support levels.
Summary: Don't be afraid in panic
Overall, the current decline is not a systemic collapse in the cryptocurrency world, but a technical adjustment with the bubble being squeezed. In fact, this could be a preparation for Trump's presidency; once he takes office, the market is likely to rebound, and the upward trend will begin, showcasing a stronger surge.
Therefore, there's no need to be afraid; panic is just a short-term fluctuation, and after the adjustment, a rebound will come quickly.
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Investing has risks; the above content is personal sharing and does not constitute investment advice!