How we are entering this bear market -
Many people think that the best time to buy is when prices are soaring. They see the crazy action and want to jump into the excitement and to make a quick buck (like many of their friends have).
Smart investors think the exact opposite. The best time to buy is when prices are on the way down. This can be a hard strategy to stick with since all you see is red, but using a few simple strategies can help you make smart trades.
The most simple strategy is to scale in over time. No one wants to catch a falling knife. Putting in all your money at one time on the way down is the best way to lose your whole stack. No one truly knows where the bottom is so don't try and guess it.
For example in the last couple weeks we have seen the crypto market fall day after day. Prices are coming back down and may soon start to bottom out. This downward market could last for a few more hours, days, weeks, or even months.
The best way to stay in the game and reap the benefits of these low prices at the same time is to scale in.
Prices are always moving, scaling in leaves you in a good position. If the market moves upward, the positions you have are making profit. If the market pulls back further, you are able to buy in at a lower price.
In either circumstance, you are in the game with out having to risk it all.
Note: The information above is intended to enable investors to understand some investment strategies. It is not intended as and does not constitute investment advice.
It's hard to know when the bottom is really reached. I bought some crypto in January as I thought the market was going back up. Not the best move, but not disastrous either. I didn't trade for few weeks, I got a bit discouraged, but I took the time to learn more about this market.
Yeah its impossible to know when we have hit the bottom. Anyone who says they know are lying! Sometimes its best to stay away from trading for a couple days or weeks, no shame in that.