The well-known quote that “Crypto Markets frequently take the stairs up and the elevator down” is highly relevant to the present crypto trends, and it suggests we are on the elevator presently! So, find out how one can utilize the ongoing market crash and mark significant profits as the meltdown continues.
The crypto market has lost roughly 8% of its total capitalisation in the last 24 hours, leading to more than $1 billion liquidations. Long traders, or those betting on rising prices, accounted for more than $793 million of total liquidations, accounting for 74% of futures contracts.
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The major currencies like Bitcoin and Ether lost critical support, resulting in significant losses for future traders. Both Bitcoin and Ethereum witnessed a ten-month low with a decline of about 20% over the past week, leading to a loss of more than 50% of their respective value since setting all-time high prices in November 2021.
With crypto prices plummeting across the board, the prices for top NFT collections are also decreasing rapidly. Many popular NFT collections witnessed significant price drops in the last 24 hours, reflecting the ongoing slump in cryptocurrency values. The floor price for many of the most valued NFT projects also dropped by 20%.
Further, the amount of outstanding derivative contracts that have not been resolved, or open interest, declined by 5.6%, signaling that traders liquidated their positions in expectation of a further drop leading to widespread discontent among the investors.
But here is how the ‘buy the dip’ principle can save you from discontent, posing a great chance to boost your profits.
The ‘buy the dip’ idea is predicated on the premise that price dips are transient anomalies that will right themselves over time. Dip purchasers expect to profit from price drops by purchasing at a bargain and reaping the benefits when the price rises.
Investors that buy the dip attempt to buy after it has fallen from its recent high. They believe that the price decrease is believed to be transitory or a short-term blip. After witnessing a long time of continuous fall, it is hard to predict when and where precisely the lowest bottom is. Experts suggest that the market is dealing with the effects of the US and global inflation as well as the European military confrontation.
However, if the past trends are to be followed, ‘every dip is followed by a new high’, so the current dip will also recover, when prices fell to comparable levels before rebounding to pre-dip levels and even peaking in the fall.
It is anticipated that the market will witness a rise, exceeding the buying price. In addition, market setbacks may also be unnerving. In general, the market rebounds to a new high following a drop. As a result, the purchase of the dip technique works brilliantly.
Also, the values of the major currencies, including Bitcoin and Ethereum, are likely to witness a rebound to former levels, but for now, they may potentially fall further. So, it might be a good idea to invest in dip while others are holding back for the market to rebound.
Experts suggest that a long-term recovery will determine how the global equity markets perform this week.
For more latest updates relating to blockchain, business, and market news, stay tuned with PCEX Member, one of the best trading platforms for investment with minimal trading fees.
