It’s been a tough early year for the crypto market, but investors are starting to show signs of hope. After its previous crash, we noticed new investors getting involved with cryptocurrency as it has now reached a mainstream audience.
If current developments in the crypto market has shown us anything, guaranteed investments are impossible due to the market’s volatile nature. There are times when the crypto market is at an all-time high, and there are times when investors move out of their investments in fear of it losing too much value.
For all of the technological coding and wizardry that occurs behind the scenes, the hundreds of blockchain applications being developed, and the consistent (and often inaccurate) speculations of future growth patterns by new altcoin evangelists, cryptocurrencies are the same as any other commodity.
Most crypto enthusiasts who spend their time studying the market are fully aware of this, as they have a fundamental understanding how real-world financial markets operate.
If you keep an eye out for them, the patterns can be easily seen – the fall and rise of values of assets. They tend to trend upwards, then rise exponentially due to an increase of interest, and then it drops when skeptical investors bail out. This is the usual cycle for the market, and it tends to change at unexpected times throughout the year.
What is a Bull Market?
In financial terms, when a commodity or asset is doing well (i.e. altcoins in late 2017), they are called bull markets. The prices tend to increase daily, meaning that there is a constant growth of new investments and new money. It also occurs when the mainstream media starts taking notice of the cryptocurrency (i.e. Bitcoin) outside of the financial realm.
As a result, investors begin to take notice of the crypto pair’s growth and try their hand at it; which prompts for more speculation. It signifies that you should get involved especially if you can invest in a crypto option during the beginning stages of a cycle.
Bear markets are the direct opposite of a bull market. It’s where the price continues to go downwards, and with no sign of returning back to its previous value. This is when traders and investors start to sell their stock to anyone that’s willing to buy it, usually at a discounted rate than their initial investment.
What Does This Mean For the Market?
Basically, despite the current decline, Ethereum, Ripple, Bitcoin, and other major players in the cryptocurrency scene are far from failing. Right now, the market is showing a dip before showing another increase in value. Due to the high volatility of the market, its rise can happen within a week, a month, or in a day.
There’s no guaranteed way of knowing how the market will change. That’s why people “speculate” on whether the crypto market will enter a bull or bear stage. But smart investors should look for altcoins that return to a bull market in the future.
Are there any additional questions you have about the current bull market?
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Disclaimer: The information in this post was made to educate our readers. If you do plan on investing in cryptocurrency, do so in your own risk.