Check out if the cryptocurrency market’s low volatility is a curse or an opportunity
Cryptocurrency markets are known for their wild price swings that can make or break investors. But sometimes, the price action is calm and steady, which can be a chance for some and a bore for others. Investors can still earn extra income during these low-volatility periods by lending their tokens through DeFi platforms or centralized exchanges. They can also stake their tokens or use advanced strategies with derivatives options and futures. This calm trend is interesting because cryptocurrency markets are usually very volatile.
In the past, similar calm periods have been followed by big price movements, either up or down. But calm does not mean that there are no strategies that can help investors increase their returns.
Cryptocurrency Traders Anticipate Low Volatility:
Even though holding tokens while waiting for green candles is the most common strategy during these times, sideways markets can be exploited with a variety of other strategies, including some market-neutral ones. Crypto traders can take advantage of these times if they are concerned about when they will end.
David Duong, head of institutional research at Coinbase, told Cointelegraph that tight price action in the cryptocurrency space was partly caused by a sharp retracement of the dollar and that many traders were “waiting for a clear trend to emerge.”
Managing Risk During Downturns in the Market:
CEX.io’s Sarwate responded, “Price consolidations and bear markets can become timely moments to revisit and potentially rebalance one’s crypto portfolio,” when questioned about risk management tactics during market swings.
To Sarwate, these times of relative security can “give the space to breathe important to settle on strategic choices.” Conventional and fluid marking open doors CEX.io’s statistical surveying group has been following, she added, have prompted expanded network cooperation that is “quantifiable across an expansiveness of wallet divisions” as marking administrations can “offer instinctive entrances for members hoping to investigate the computerized economy.”
What Occurs After Bitcoin Exchanges Like a Stablecoin?
Getting some information about his possible viewpoint for Bitcoin and the more extensive digital money market over the course of the following half year, Ismail noticed that the market is “looking at its next cost impetus,” as economic situations show “financial backers are gathering BTC at lower levels.”
He speculated that, given the halving event in the first half of next year, there would be a greater likelihood of a significant price change as market sentiment changed.
Despite the increased regulatory scrutiny, “palpable optimism in the crypto space,” according to Sarwate. She stated that this year has been characterized by a “steady stream of inspiring technological breakthroughs and discoveries that are reinvigorating the digital asset space.”
