7 Unusual Signs on the Path to a Bear Market
written by
James Stone
posted on
It’s easy to envision that other people’s crypto paths (bear market or otherwise) are somehow smoother than yours.
Have you ever had thoughts like that?
Notions that everyone else who has some form of crypto success achieved it by getting in at the right time, while you:
- Take two steps forward, one back
- Stop to enjoy your mediocre results
- Forget why you’re even investing in crypto, so you get out for a bit …
It can feel like that, but I have to remind myself that I don’t actually believe success comes from timing.
The ‘’continually-trying-to-figure-things-out’’ shuffles goes hand-in-hand with a professional crypto trading life.
You can practice profitable decision-making to increase your chances of a favorable outcome, but that doesn’t make you immune to dips and the risk of going into a bear market.
And sometimes dips are exactly what we need to get clear about our priorities and make the next right choice.
To remind us that working hard toward those 200%, 300% gains is typically more awkward than elegant, here are seven — seemingly unpleasant — signs of a potential bear market.
#1 Someone tells you ‘’ATH coming soon’’
It could be your favorite content creator who boasts about their latest crypto addition or an article with an extremely positive market prediction.
The first time I read about bitcoin going to 100K, it went to 3K.
But that extreme optimism was an indicator that the market was at a peak, and as some of you know it made my portfolio go up in thin air.
If either I knew the signs or I had set my priorities differently, I could’ve gained so much more. I decided to trust the bulls and allowed myself to get caught up in the hype.
Trusting didn’t mean that I stopped doing my own research. I found that there were hardly any non-bullish articles or influencers, and I didn’t go out of my way to find them.
Three years later, the market is acting bullish again and I’m ready.
That original ‘’dip’’ was a priceless lesson part of my growth as a crypto trader.
#2 Someone doesn’t like you asking critical questions
Just because you don’t buy into the hype as everyone else, it doesn’t necessarily mean you don’t believe in crypto or bitcoin.
Remember the hype around Bitconnect and multiply it on a global scale, that’s what a bull market can be like. And we all know how that turned out.
If everyone in the market has the exact same bullish perspective, it probably isn’t that accurate. This is also a big red flag for any crypto project on your radar. If everyone you talk to is bullish but isn’t willing to answer your critical questions, it probably isn’t as good as they believe.
But if you find skeptical people amongst the bulls, good chances are that the market is still in an uptrend.
You should celebrate when the market has extended beyond the ‘’to-the-moon’’ community and landed in front of people with different opinions and market views.
#3 You see a decline in Bitcoin trading volume
It’s a tough thing to keep track of, but you can look for technical indicators.
To help you move past those technical terms, consider the position of other traders: are they still buying, or is the price of Bitcoin hardly moving?
If you’re worried about the potential risk of a bear market, many traders look at the trading volume. If it’s going up, that means we are still bullish, but if it is declining that means we need to be on high alert.
Low volume, declining volume are not only signs of a bear market but also of incoming dips, they can help you time your investments and make you an overall better trader.
It’s smart to assess when you want to get into a certain project so that you make the most of the gains.
Turning down an investment opportunity when the timing isn’t right for you is a turning point in your crypto career.
#4 You haven’t made any profit from the last few positions you bought
If you want to find another sign of an upcoming bear market, look no further than at your own portfolio.
Look at the last 4 to 5 crypto projects you bought and examine them. Have they been giving you a profit? Or are they giving you losses?
If you haven’t made a dime on any of them, you could be picking up signs of a new downtrend.
#5 You’ve ‘’wasted time’’ on market research
Investing time into the state of the market might always produce immediate payoff, but it’s never useless.
At the very least, traders who make their own continuing education a priority are making gains despite the state of the market. Learners: 1, Know-It-Alls:0.
Research can also help you get a head start.
Professional traders get comfortable with that. They prefer to make their decisions and get momentum, rather than wait for the market to be in a ‘’perfect’’ state.
#6 Stop what you’re doing when its march
March has consistently been the worst-performing month for bitcoin, with a mean average loss of 14.725% since 2017 when the market started to gain traction. The second-worst month, on average, is September, with a mean loss of 9.05% over the same time frame.
#7 You’re uncomfortable
I think your comfort zone gets a bad rap, but being uncomfortable is indeed a sign of a declining market.
Certainty feels pretty static, but if you’re not quite sure how things are going to turn out … they might be moving down.
Let me know what you think about the state of the market down below or on twitter!
James Stones
James Stones is Crypthena’s Editor-in-Chief. He writes on a wide range of topics, such as the state of market, the best hedge funds or who the best non-sleazy advisers are.
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