We are in a historical period of high volatility among cryptocurrencies. It is not that there has been no volatility in the past, but now, in the bull run phase, it seems strange how Bitcoin at some point undergoes strong downward corrections. In fact, those who have recently entered the world of digital currencies were expecting the price to continue to rise indefinitely and this is demonstrated by the very high number of liquidations that took place yesterday (March 19), with the red candle on the timeframe. daily of BTC. Specifically, yesterday Bitcoin pierced the psychological support of $ 40,000 and also the graphic one given by the 200-period exponential moving average (EMA200) to go to lean on $ 30,000. At the close of the day, a shadow was formed with a width of about 50% of the candle, which makes it a bullish candle. If the following candles report closings of 42,000 or 43,000 dollars, we can hope for a restart in the short term. Here's what happened on Binance:
These corrections are physiological for Bitcoin and are also necessary. If they were not there, in fact, the graph would go into hyperextension and growth would not be sustainable from a capital and graph point of view. Therefore, we Hodlers must see these retracements as an entry opportunity and not a definitive loss. I would like to point out that the retracements have already occurred in the past bull-runs and this is evidenced by indicators such as the RSI which made a dip before the final peak in 2013 and 2017 as well.
The absolutely NOT-to-do when these price-level crashes occur is to sell. Closing positions when the price falls is a mistake that beginners make and leads to a very large loss. I understand that it is difficult to keep calm but the trader has to be apathetic and impassive to do his job. Emotions do not find space between the candles of the graphs!
Finally, I would like to close this thought with a consideration. We are in a phase where major cryptocurrencies have announced the launch of major changes and additions to their protocols: Ethereum (ETH) is moving to ETH 2.0, Cardano (ADA) has announced the integration of smart-contracts and Polkadot (DOT) is planning auctions for parachains. These are just the most important announcements made recently but there are many others and it would not be at all convenient to enter the bear market as long as most of these changes are still pending.
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