Cryptocurrency market trends and cycles: what do you need to know
In recent years, the cryptocurrency world has grown huge growth and volatility in recent years, so it has been a very desirable opportunity to invest. However, as in any market, understanding of trends and cycles that make up the cryptocurrency landscape are very important to make conscious decisions on your investment.
What are the cryptocurrency market trends?
The cryptocurrency market is determined by the power of supply and demand, which is influenced by various factors such as the mood of investors, technological progress, regulatory development and global economic conditions. These trends can be divided into three main ways:
1
Delivery Trends : They occur when the total supply of cryptocurrency exceeds its demand, resulting in a reduction in prices.
2.
3
Neutral Trends : These are the periods when the market mood is evenly balanced between supply and demand forces.
Cryptocurrency cryptocurrency market trends
Cryptocurrency markets have experienced several cycles over the years, each with its own unique qualities:
1
Trends cycles : Historically cryptocurrency markets follow the trend bicycle model that can be identified, technically analyzed in chart models such as::
* 4 -hour candle model: Bullish (Bull) and Bear (Bear)
* 14 days of RSI (Relative Strength Index): Beary
2.
* Bitcoin 2017-2018 annual bull racing and subsequent amendment
* Ethereum 2020-2021 growth and subsequent amendment
Understanding the cryptocurrency market cycles
In order to switch to the complex cryptocurrency market environment, it is important to understand how cycles work:
1
reverse cycle : When a trend starts to turn around or decay, it can lead to significant price changes.
- Correctional cycles : After growth or increase, the correction phases often occur due to excessive reactions.
3
Neutralization cycles : Markets can return to its original state after a long downturn.
Basic market scores to watch
Analyzing Cryptocurrency Market Trends and Cycles:
1
Candlestick models
: Use technical indicators such as variable average convergence deviation (Macd) and RSI to determine the changes in trends.
2.
3
Basic Analysis : Evaluate market mood, economic data and news events that can affect cryptocurrency prices.
Investment strategies
Move towards the ever -changing cryptocurrency market environment:
1
Diversification : Spread investment in various cryptocurrencies to reduce risk.
2.
3
Long perspective : Focus on investment for a longer period of time as cryptocurrency prices can be very unstable.
Conclusion
The cryptocurrency markets are inherently complex and are subject to various trends and cycles. By understanding the main indicators, risk management strategies and long -term prospects, investors can make conscious decisions on their investment in this rapidly changing market.
Although previous results do not guarantee future results, it is important to follow market trends and be prepared for potential changes as the cryptocurrency landscape continues to develop.