For 2018, the markets started off in a mostly positive direction, and have now started heading in reverse. The Dow plunged over 665 points, posting the steepest weekly decline in over two years. As mainstream markets decline, investors immediately start re-assessing their risk tolerance, and Crypto Currency (CC) investors are re-assessing risk even more, given all the discussion about how volatile this market space can be. It is not the usual mainstream economic drivers causing the CC plunge – it is fear, which is wildly contagious across all investment categories. Markets are largely driven by human fear and greed, two emotions that cause most investors to be unsuccessful over the long term. Cold hard analysis, coupled with “smart” Buy/Sell strategies, removes emotion from your investment decisions and paves the way to success. Strong bull markets need to correct once in a while, to restore balance and set the stage for the next run up.
CC Exchanges can be significantly less nimble than the mainstream stock market exchanges; however, there are several CC Exchanges that accommodate BUY and SELL LIMIT orders. Using those facilities as part of an “Entrance and Exit” strategy is highly recommended.
The news in the CC markets throughout January was mainly focused on the declining prices of almost all the coins. CC price declines preceded the overall stock market decline and are a reaction to more and more national governments indicating that they want to either ban CC’s, or increase their means to control and tax them. With all the fear that is now being generated in the mainstream stock markets, this is a perfect storm wherein CC investors have multiple sources generating fear.