{"id":180722,"date":"2023-08-29T01:39:22","date_gmt":"2023-08-29T01:39:22","guid":{"rendered":"https:\/\/precoinnews.com\/?p=180722"},"modified":"2023-08-29T01:39:22","modified_gmt":"2023-08-29T01:39:22","slug":"crypto-bull-run-traders-share-their-plans-for-the-tornado-to-come","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/crypto\/crypto-bull-run-traders-share-their-plans-for-the-tornado-to-come\/","title":{"rendered":"Crypto bull run: Traders share their plans for the \u2018tornado\u2019 to come"},"content":{"rendered":"
With as much as 130 million people introduced to cryptocurrencies since the end of 2021, millions of investors could soon be looking at their first crypto bull run, with some suggesting it could come as early as 2024. <\/p>\n
However, unlike the current bear market, a bull market is \u201cunlike anything else you’ve ever experienced\u201d according to Ben Simpson, founder of education platform Collective Shift. <\/p>\n
\u201cIt’s complete and utter chaos. It’s just a tornado.\u201d<\/p><\/blockquote>\n
In August, Cointelegraph spoke to hedge fund managers, heads of research at digital asset companies, and other crypto traders to understand how they\u2019re preparing for the upcoming bull market and some of the learnings they could pass onto newcomers. <\/p>\n
Get in, get out<\/h3>\n
Simpson said one of the biggest mistakes that new crypto traders make is holding onto their crypto bags too long \u2014 most often caused by getting caught up in the euphoria that they could make more. <\/p>\n
\u201cMy first cycle, I didn’t have a plan. I rode it up and rode it all the way down back in 2017.\u201d<\/p><\/blockquote>\n
Instead, Simpson said it could be helpful for investors and traders to write down a clear investment goal and understand what assets are in their portfolios \u2014 with a hard-set sell price for each one.<\/p>\n
Setting hard market exits may reduce the possibility of losing on an investment as \u201conce the music stops in a bull market it stops really quickly,\u201d said Simpson. <\/p>\n
On the same note, CoinShares head of research James Butterfill told Cointelegraph that dollar-cost averaging \u2014 periodic small asset purchases or holdings sales \u2014 could mitigate the volatility of cryptocurrencies, whether it’s a bull or bear market.\u00a0<\/p>\n
\u201cImplementing dollar-cost averaging can help lower the average purchase cost and diminish the influence of volatility on one’s portfolio,\u201d Butterfill said.<\/p>\n
Avoid memecoins<\/h3>\n
CK Zheng, co-founder and CIO of hedge fund manager ZX Squared Capital recommends investors to look into the more well-established and recognized cryptocurrencies, such as Bitcoin (BTC) and Ether (ETH).<\/p>\n
Butterfill argued Bitcoin behaves similarly to other alternative assets and has \u201cremarkable diversification benefits, surpassing assets like gold, commodities or real estate.\u201d<\/p>\n
Meanwhile, Deryck Graham, founder of crypto hedge fund Portal AM said to consider balancing investments between speculative and mature cryptocurrencies.<\/p>\n
Graham added to break down investment sectors \u2014 such as Layer 2\u2019s or the Metaverse \u2014 and choose related tokens while avoiding those with \u201clittle or no practical use,\u201d namely memecoins.<\/p>\n
\u201cConsider tokenomics, dev team track record, whale investors coming in and leaving, community size, market momentum and liquidity,\u201d he added.<\/p>\n
Find the theme<\/h3>\n
Matrixport head of research and Crypto Titans<\/em> author Markus Thielen told Cointelegraph that Bitcoin has \u201calways hit a new high\u201d in a booming market but added new themes drive new bull markets \u2014 supporting the idea of investing in new cryptocurrencies instead of those from the previous bull run.<\/p>\n
Related: <\/em><\/strong>2024 could be very bullish for crypto \u2014 Here\u2019s why<\/em><\/strong><\/p>\n
At the same timeSimpson said having high-conviction investments will help with staying on goal as most will have \u201cno chance\u201d of keeping up with a portfolio of altcoins.<\/p>\n
\u201cI spoke to a guy the other day that has 80 altcoins in his portfolio. There’s no way an individual investor can stay across and know exactly what 80 different coins are doing at any one time.\u201d<\/p><\/blockquote>\n
Simpson, Zheng and Graham all warned against overexposure to crypto through taking loans to invest in the market, investing more than a person can afford to lose or trading using leverage.<\/p>\n
\u201cA leveraged position can result in a total wipeout of capital when one is least prepared,\u201d Zheng said. \u201cIt’s important to have the mindset of investment, not speculation.\u201d<\/p>\n
Simpson added it\u2019s important to have time away from crypto and watching markets. He advised both trading veterans and newcomers to safeguard their mental health.<\/p>\n
\u201cGo for regular walks. Go for a run. Go to the gym. Be a human.\u201d<\/p><\/blockquote>\n
Magazine: How smart people invest in dumb memecoins \u2014 3-point plan for success<\/em><\/strong><\/p>\n
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.<\/p>\n