Fundamentals of buying and selling cryptocurrency

Cryptocurrency is endlessly the hot topic of the market. Everyone is looking for ways to do their research and start investing in the market. And why not? When you heard so many stories about how people made double, triple, quadruple or even more money, then you would definitely want to try yourselves there.

But what pre-gambling factors or preparation do you need before you start investing in cryptocurrency? Reading about terminologies is one thing, but what comes next? It's learning about them.

Crypto is just as valuable an investment as an asset. And before investing, you should be well aware of the situations that define its value, or more specifically, when to sell or buy Cryptocurrency. Since cryptocurrency is not managed by any particular regulatory body, it becomes somewhat tricky but very important to do thorough market research and keep up to date with current news and happenings.

Understanding the Stage of Euphoria and Despair

Just like we have Bitcoin season and Altcoin season, we have stages of euphoria and despair. Before we go any further, let's quickly understand these terminologies.

Euphoria stage: No, this is not an Enrique Iglesias album we are talking about. Just as we have ups and downs in the stock market, the Euphoria stage is the rise of cryptocurrency. This is the time when you want to sell. The reason is very simple; when prices are high, you will make profits.

Stage of despair: I know how smart my readers are, and most of you must have understood what the stage of despair means. But let's take a quick look. The desperation phase is when prices drop or fall. Since prices are at rock bottom, now is the best time to buy and invest in cryptocurrency.

Now, how would you know if this is the stage of euphoria or despair? There is a reliable website by the name of Glassnode where you can find a chart that will give you all the necessary information you need to make the right decision.

After having a basic understanding of what the euphoria and despair stages are, let’s now move on to understanding what fundamentals support the buying and selling of cryptocurrency. Whether you are an intermediary or an expert, you must have some of your own theories that could help support the decision. But these theories may or may not always turn out to be beneficial. To make a rigid decision, you must be aware of all the facts and news related to the subject.

Fundamentals to keep in mind when buying or selling cryptocurrency

Just as buying is an important decision, selling is also crucial. Before buying any cryptocurrency, you should research various factors to justify your purchase. In the same way, when selling Crypto, you should be well informed about all the factors and situations that could help you smooth the process. So let us understand some of the fundamentals you should consider before buying or selling a Crypto coin.

Technical Analysis: Whether you're buying cryptocurrency or stocks, calculation is crucial in both cases. Now what do you need to calculate? How many pieces should you buy and at what price? Or when should you buy a particular part? There is a technical analysis you need to do beforehand to protect yourself from losses or mishaps.

Technical analysis uses mathematical indicators to estimate market trends in order to learn how the market works and what factors will be responsible for future price changes. When studying an upward or downward price trend, we look at many factors. In addition, three assumptions underlie technical analysis. Let's take a look at these:

The Three Assumptions of Technical Analysis

Prices move in a pattern: Regardless of the time frame you have set or followed, the price will always fluctuate and show trends, even when market movements are random and not fixed.

Green and red marks indicate candlesticks in the chart. Their purpose is to show the direction of the price and the trend it is following. Like any other subject, prices are also said to follow a trend. Future price movement can simply be judged by looking closely at established or ongoing trends. The price trend can be in any direction, down, up or even sideways (to the right).

The market discounts itself: different cryptocurrencies have different prices. But have you ever wondered why this is so? This is because of their usefulness and demand. But what lies behind this assumption is that anything that could affect the price of a coin is reflected in the...