When the Bulls Are Running: How to Spot and Capitalize on Crypto Bull Markets
Bull markets are every crypto investor's dream — a chance to surf a wave of green candles and lock in life-changing returns. But navigating a bull market can be a challenging experience. This guide will help you ride the raging crypto bull with caution and courage.
After such a prolonged crypto winter, you might not feel relieved just yet, however. And that’s okay, because navigating bull markets requires courage as well as caution. Lucky for you, we’re here to help you spot the signs early, have a plan to maximize gains, and know when to get out before the bears return.
Bull and Bear Market Difference
Bull markets are a crypto investor's best friend. When the bulls are in charge, the market is on the rise. Investor optimism is high, the economy is strong, and crypto prices are going up. In a bull market, fortunes can be made as crypto assets surge in value and investors ride the wave of gains.
Bear markets, on the other hand, are every crypto investor's nightmare. When the bears take over, the market declines. Investor sentiment turns negative, the economy weakens, and crypto prices crash. In a bear market, portfolios can be destroyed as assets plunge in value and investors are left with heavy losses.
The crypto market will always have ups and downs. But for the investors who can stay rational and detached while others succumb to fear and greed, there are opportunities to profit in any type of market. The key is knowing whether the bulls or bears are in charge and how to respond accordingly.
How to Identify a Crypto Bull Market
While there's no one-size-fits-all metric to pinpoint a bull market, there's a widely accepted definition: when prices surge by 20% or more from recent lows, you've got yourself a bull market. Now, predicting bull markets is no easy feat. In fact, analysts usually spot them only when the rally is well underway.
But don't worry; there are telltale signs to help you spot the bull:
Surging trading volume: As more investors jump on board to buy and hold crypto, expecting sweet capital gains, trading volume soars.
Increasing demand: In a bull market, crypto demand outshines supply as an eager crowd of investors clamors to buy, but few are willing to sell. This fierce competition pushes prices higher.
Tempting investor confidence: Rising crypto prices fuel investor confidence, enticing more people to enter the market, expecting handsome returns.
Soaring liquidity: Bullish markets boast higher liquidity, enabling lower transaction costs as investors anticipate swift, steady returns.
Improving fundamentals: Companies grow more confident in taking risks, fueling international investment, business growth, product development, and feature updates. Surging profits drive more expansion and attract more manpower into the industry.
If you never take fundamentals at face value, you might want to confirm the improving market sentiment by analyzing the charts.
Technical indicators analyze past price action to gauge where the market may head next. To tell if they are running into bulls, look for the following signs:
Bitcoin dominance shows Bitcoin's share relative to other cryptos. During bull runs, dominance drops as money flows into alternatives. A rising total crypto market cap combined with falling Bitcoin dominance often signals a bull market.
The relative strength index (RSI) measures whether an asset is overbought or oversold, indicating wider bullish or bearish sentiment. Cryptos are overbought around an RSI of 70, signaling peak bull market momentum. Under 30 means oversold, suggesting a bull run may start.
Moving averages track an asset's average price over time, like 200, 50 or 20 days. When the price stays above a long-term average, it points to an upward trend. If the price crosses above a shorter-term average, it may signal the start of a bull run.
Bull Market Example
Jimmy was a savvy crypto investor. When the market was down and assets were cheap, he invested in a promising project. Though he had to endure volatility for years, he held on, waiting for the next bull run.
Eventually, Jimmy spotted signs of recovery. Trading volume picked up as investors returned. His crypto's value started rising again. The market grew more liquid, and it became clear that the bulls were back.
As the rally gained speed, Jimmy's investment surged upward. His patience and vision were rewarded. By buying in at the bottom, he was perfectly positioned to ride the bull market up and lock in life-changing gains at the top.
While others panicked and sold at a loss during the bear market, Jimmy kept his cool. He did his research, invested in solid fundamentals, and held on until sentiment turned bullish again. Now, the same assets that were on sale years ago had skyrocketed in value.
Jimmy sold when it was time, walking away with substantial profits. The bull run didn't last forever — soon, the market turned bearish as the hype faded and valuations became stretched. But Jimmy had mastered the cycle. He preserved most of his gains, leaving a bit invested in case the next bull market offered another opportunity.
Jimmy knew crypto was volatile and cyclical. He didn't try to time the market or predict each turn. But by focusing on value, believing in the long game, and distinguishing bull markets from speculative mania, he was able to build wealth over time through the rises and falls. The key is keeping hope through the darkness so you're ready to once again ride the light.
And take a look at my top charts, which I will follow this week:)
Watch the price and formations and look for volume spikes before resistance levels. Those types will be the trigger for further movement to the bull trend.
See you soon, folks! Have a nice trades!
Bull markets are every crypto investor's dream — a chance to surf a wave of green candles and lock in life-changing returns. But navigating a bull market can be a challenging experience. This guide will help you ride the raging crypto bull with caution and courage.
After such a prolonged crypto winter, you might not feel relieved just yet, however. And that’s okay, because navigating bull markets requires courage as well as caution. Lucky for you, we’re here to help you spot the signs early, have a plan to maximize gains, and know when to get out before the bears return.
Bull and Bear Market Difference
Bull markets are a crypto investor's best friend. When the bulls are in charge, the market is on the rise. Investor optimism is high, the economy is strong, and crypto prices are going up. In a bull market, fortunes can be made as crypto assets surge in value and investors ride the wave of gains.
Bear markets, on the other hand, are every crypto investor's nightmare. When the bears take over, the market declines. Investor sentiment turns negative, the economy weakens, and crypto prices crash. In a bear market, portfolios can be destroyed as assets plunge in value and investors are left with heavy losses.
The crypto market will always have ups and downs. But for the investors who can stay rational and detached while others succumb to fear and greed, there are opportunities to profit in any type of market. The key is knowing whether the bulls or bears are in charge and how to respond accordingly.
How to Identify a Crypto Bull Market
While there's no one-size-fits-all metric to pinpoint a bull market, there's a widely accepted definition: when prices surge by 20% or more from recent lows, you've got yourself a bull market. Now, predicting bull markets is no easy feat. In fact, analysts usually spot them only when the rally is well underway.
But don't worry; there are telltale signs to help you spot the bull:
Surging trading volume: As more investors jump on board to buy and hold crypto, expecting sweet capital gains, trading volume soars.
Increasing demand: In a bull market, crypto demand outshines supply as an eager crowd of investors clamors to buy, but few are willing to sell. This fierce competition pushes prices higher.
Tempting investor confidence: Rising crypto prices fuel investor confidence, enticing more people to enter the market, expecting handsome returns.
Soaring liquidity: Bullish markets boast higher liquidity, enabling lower transaction costs as investors anticipate swift, steady returns.
Improving fundamentals: Companies grow more confident in taking risks, fueling international investment, business growth, product development, and feature updates. Surging profits drive more expansion and attract more manpower into the industry.
If you never take fundamentals at face value, you might want to confirm the improving market sentiment by analyzing the charts.
Technical indicators analyze past price action to gauge where the market may head next. To tell if they are running into bulls, look for the following signs:
Bitcoin dominance shows Bitcoin's share relative to other cryptos. During bull runs, dominance drops as money flows into alternatives. A rising total crypto market cap combined with falling Bitcoin dominance often signals a bull market.
The relative strength index (RSI) measures whether an asset is overbought or oversold, indicating wider bullish or bearish sentiment. Cryptos are overbought around an RSI of 70, signaling peak bull market momentum. Under 30 means oversold, suggesting a bull run may start.
Moving averages track an asset's average price over time, like 200, 50 or 20 days. When the price stays above a long-term average, it points to an upward trend. If the price crosses above a shorter-term average, it may signal the start of a bull run.
Bull Market Example
Jimmy was a savvy crypto investor. When the market was down and assets were cheap, he invested in a promising project. Though he had to endure volatility for years, he held on, waiting for the next bull run.
Eventually, Jimmy spotted signs of recovery. Trading volume picked up as investors returned. His crypto's value started rising again. The market grew more liquid, and it became clear that the bulls were back.
As the rally gained speed, Jimmy's investment surged upward. His patience and vision were rewarded. By buying in at the bottom, he was perfectly positioned to ride the bull market up and lock in life-changing gains at the top.
While others panicked and sold at a loss during the bear market, Jimmy kept his cool. He did his research, invested in solid fundamentals, and held on until sentiment turned bullish again. Now, the same assets that were on sale years ago had skyrocketed in value.
Jimmy sold when it was time, walking away with substantial profits. The bull run didn't last forever — soon, the market turned bearish as the hype faded and valuations became stretched. But Jimmy had mastered the cycle. He preserved most of his gains, leaving a bit invested in case the next bull market offered another opportunity.
Jimmy knew crypto was volatile and cyclical. He didn't try to time the market or predict each turn. But by focusing on value, believing in the long game, and distinguishing bull markets from speculative mania, he was able to build wealth over time through the rises and falls. The key is keeping hope through the darkness so you're ready to once again ride the light.
And take a look at my top charts, which I will follow this week:)
Watch the price and formations and look for volume spikes before resistance levels. Those types will be the trigger for further movement to the bull trend.
See you soon, folks! Have a nice trades!