From Bull Run Basics to Trading Mastery: Your Ultimate Crypto Guide
Ever felt the rollercoaster ride of the crypto world? It sure can be a wild journey with all its ups and downs. But guess what? The real thrill is during a 'bull run' - that's where the magic happens!
But what is a crypto bull run? How does it compare to the market's past trends? And most importantly, how can traders strategize for maximum profitability during such periods?
This article addresses these questions by exploring the concept of a crypto bull run, its history, predictions, and the best trading strategies during these favorable market conditions.
Begin your crypto journey by understanding bull runs. Explore now.
Imagine you're at a festival and see a bull charging forward with unstoppable energy. In the financial world, the term "bull" is used similarly to describe a market that's moving upward.
1. Crypto Bull Run Explained
A "crypto bull run" refers to a period when the prices of cryptocurrencies, like Bitcoin or Ethereum, are expected to keep rising for a while. During this time, there's a lot of excitement, media coverage, and more people wanting to buy in, hoping the value will go even higher.
2. History of Bitcoin Bull Runs
The history of Bitcoin's price movements features several notable "bull runs" where the value of Bitcoin experienced rapid and significant upward trends. Here's a brief overview:
Late 2013: Bitcoin surpassed $1,000 for the first time in November. This was a significant milestone, considering it was only around $13 at the beginning of the year.
Late 2017: Bitcoin experienced a massive surge, reaching nearly $20,000 in December, drawing extensive media coverage and mainstream interest. This was followed by a significant correction in 2018, where prices dropped back to the $3,000-$4,000 range.
Late 2020 - Early 2021: In a rally often credited to institutional interest, economic uncertainty, and the increasing acceptance of Bitcoin as a store of value, Bitcoin's price surpassed previous highs and reached a then-new peak of over $60,000 in April 2021.
Each bull run has unique drivers, ranging from media coverage and retail speculation to institutional adoption and macroeconomic factors.
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Several factors can trigger a bull run in the cryptocurrency world:
1. Positive News: Maybe a big company announces they'll accept Bitcoin, or a country introduces friendly regulations.
2. Increased Adoption: More people and businesses start using cryptocurrencies.
3. Technological Advancements: Updates or improvements to a cryptocurrency can spark interest.
4. General Hype: Sometimes, the buzz and fear of missing out (FOMO) can increase prices.
5. Possible Regulatory Scrutiny: With the increase in activity, regulators might take a keener interest in the space, leading to announcements that fuel or temper the bullish sentiment.
6. Optimistic Sentiment: The overall sentiment in the community becomes optimistic. This can be observed in online forums, social media, and other discussion platforms where positive sentiments and future price predictions dominate conversations.
7. Increased Trading Volume: Bull markets usually see a surge in trading volumes. This means more cryptocurrencies are being bought and sold. High volume often validates a bullish trend.
"Equip yourself for the next crypto bull run. Get the insights now"
CZ mentioned in a recent Twitter chat that the year following a bitcoin halving typically we saw a price surge. However, he also predicts the current crypto price drop might last another 18 months.
Next April, Bitcoin's "halving" will reduce the new bitcoins given to the miners maintaining the Bitcoin network by half. This will change the reward from 6.25 bitcoins to 3.125.
Recently, JPMorgan analysts predicted that this halving in 2024 will make producing new bitcoins twice as expensive, which might create a new minimum price for bitcoin.
CZ mentioned that predicting Bitcoin's price is tricky. Still, he sees repeated patterns by looking at Bitcoin's historical price trends from 2013, 2017, and 2021. Based on this, CZ believes the Bitcoin price could surpass its last high of nearly $70,000 by 2025.
CZ commented positively on the recent U.S. bitcoin ETF applications, particularly from BlackRock, calling them "very beneficial" for the crypto world. While he knows these might compete with Binance to some extent, he feels the overlap with Binance's users will be small.
The Bitcoin halving is a significant event in the cryptocurrency world, and each occurrence garners more attention from investors, developers, and analysts. The event reduces the number of new bitcoins created and awarded to miners by half.
Here's why the next Bitcoin halving is significant
1. Supply Reduction: The most direct impact of the halving is that it reduces the rate at which new bitcoins are introduced into circulation. This is significant in the basic economic principle of supply and demand: price rises if demand remains constant (or grows) and supply decreases.
2. Miner Revenue Impact: Miners will receive fewer earnings with the block reward cut in half. Inefficient miners might shut down due to reduced profitability, potentially temporarily lowering the network's hash rate. But a surge in Bitcoin's price could balance this reduction in reward.
3. Price Forecast: Bitcoin's price has historically experienced significant movements leading up to and following halvings. Though past performance doesn't predict future outcomes, many investors watch the halving closely for potential price impacts.
4. Increased Media and Mainstream Attention: Halvings attract significant media coverage, bringing more awareness and potential adoption from a broader audience.
5. Economic Model Validation: Bitcoin operates on a predictable economic model. Each halving serves as a milestone that reinforces the reliability of its decentralized and predetermined monetary policy.
6. Long-term Security Implications: As block rewards decrease, transaction fees will become a more crucial incentive for miners. This shift could influence the fee market and the network's security in the long run.
7. Potential for New Price Floors: If historical patterns repeat, halvings could establish new price floors for Bitcoin. For instance, increased demand due to the reduced supply combined with the cost of production could set higher base levels for Bitcoin's value.
The upcoming Bitcoin halving will emphasize its limited supply, possibly influence its price and underscore its distinct economic design. While outcomes are Assumptive, the event is crucial to Bitcoin's overall story and growth.
"Trade smart during crypto's next bull run. Discover the best strategies"
During a bull run, emotions run high, and it's easy to get swept up in the euphoria. Here are some strategies to consider:
1. Buy trustworthy coins
In a bull market, most coins, even new ones, increase in value. But as time passes, only the trusted coins with realistic business plans keep growing. Coins that went up just because others did might only stay up for a short time.
At the beginning of the bull run, you can earn money with new, low-cap coins. But seasoned investors suggest moving your money to well-known, trusted coins as the market grows.
2. Look for undervalued coins
At the start of a bull market, some new, smaller coins might be priced lower than they're worth. Experts believe these coins can grow quickly in a good market.
3. Seek Out Innovative Tech
Most new coins in the market aren't just trying to replace regular money. Instead, they have specialized uses like handling decentralized finance (DeFi), managing unique digital items called NFTs, or supporting blockchain systems called oracles.
Some of these tokens use cutting-edge technology to address challenges that older, well-known coins face. Experts believe tokens designed for a specific purpose or a growing market segment will likely grow the most during a bull market.
4. Diversify your Portfolio
Most professional investors have strong opinions but agree on the need to spread your investments, especially during bull markets. Doing this lowers your risks, and can benefit from growth in different areas.
In the crypto world, a well-spread investment might have well-known coins, new tokens, coins involved in DeFi and other booming areas, tokens linked with new tech, newer low-cap coins, and more. It's like buying a piece of the entire market, which is a good approach during a strong upward trend.
5. Dollar-Cost Averaging (DCA)
Rather than trying to time the market, invest a fixed amount at regular intervals, regardless of the price. DCA approach can help moderate the impact of volatility.
6. Consider Taking Profits
If you've achieved significant gains, it might be wise to cash out a portion of your holdings to secure profits. You can then reinvest during corrections or diversify further.
7. Sell in Phases
It's wise to sell in different phases of the bull run. Since predicting the peak price for your tokens is tough, think about selling a portion this week, then a bit more the next, and continue in that pattern. This method evens out market changes and aids in preserving your portfolio's overall worth.
Jumping into crypto during a bull run is exciting but tricky for newbies. Just like starting anything new, it's okay to take it slow. Listen, learn, and don't get too lost in the buzz. With the right approach, even newcomers can make the most of the opportunities while protecting their investments. Let's do this together and enjoy the ride!
1. How are crypto bull run predictions made?
Predictions about crypto bull runs are often based on historical data, current market trends, macroeconomic indicators, technological advancements, and sentiment analysis. Experts might use chart patterns, technical analysis, and other tools.
However, it's essential to understand that predictions are hypothetical and not guaranteed.
2. Can global events impact the likelihood of a bull run?
Absolutely. Major global events, such as financial crises, elections, technological breakthroughs, or pandemics, can influence investor sentiment and behavior.
Positive global news can increase trust and investment in crypto, while negative news might have the opposite effect.
3. When is the next bull run expected in the cryptocurrency market?
Looking at Bitcoin's history, the big rise in crypto prices might begin after the next Bitcoin's halving in 2024 and could peak by the end of 2025. But crypto prices can change a lot and are hard to predict.
4. Why is the next Bitcoin halving significant?
The next Bitcoin halving is crucial because it reduces the rate at which new Bitcoins are introduced into circulation. Historically, halving events have been associated with significant price volatility and have influenced supply and demand dynamics, potentially impacting the overall value of Bitcoin.
5. Best crypto coins for the next crypto bull run?
1. Ethereum (ETH)
2.Binance coin (BNB)
3.Polkadot (DOT)
4.Chainlink (LINK)
5.Solana (SOL)
6.Aleph Zero (AZERO)