Relativity Is Everything In This Market
Regular readers are most likely familiar with the term “relativity ratios”. When it comes to designing and creating effective trading strategies, relativity ratios are key. Everything within the financial world is relative in one way or another. As a trader, understanding and leveraging relativity ratios is imperative. Risk/reward ratios are yet another example of a relativity ratio. A good investment opportunity has several relativity ratios working together in synchronization.
Altcoins may have been a lot cheaper earlier this year. However, concerning the price of Bitcoin, many are offering excellent entry points, especially for medium to long-term investors. When you consider that BTC has corrected a mere 19% from its local top, altcoins are currently offering enormous discounts. Polkadot, for example, has retraced as much as 53% from its local top.
Another excellent opportunity is Cardano, which has fallen as much as 54% from its recent high. Then, of course, there is the micro-cap sector, which is offering even greater discounts. Historically, we have always seen a correction around the time of the halving. And as always, it provides an excellent opportunity for altcoin and micro-cap investors. As I mentioned in yesterday’s article, this pain will soon be forgotten:
Essentially, within 6 to 8 months, prices will be significantly higher across the board.
This perspective and conviction encourage dedicated investors to take advantage of these prices while they can. You may be wishing for a serious pump to save your altcoin bags. However, in time to come, you will wish you could revisit these levels. You cannot initiate a market move. However, you can choose to work proactively within the existing market dynamics.
Learning to work with the market instead of fighting it is evidence of a maturation, regarding a trader’s psychology and approach. This is an important phase of the journey and is imperative if you are to establish and settle into a unique and personalized trading style. Most traders spend their time fighting the market. Being contrary to the market, they continuously seem to find themselves in a wrestling match.
Regardless of whether or not Bitcoin decides to travel lower, this is an excellent opportunity to begin dollar-cost averaging into altcoins. Choosing to go all-in at this point might rob investors of even greater discounts in the event Bitcoin chooses to find a local bottom at $55K, as opposed to the local bottom at $59K. Such a move is likely to affect altcoin prices rather negatively.
Final Thoughts
A long-term and dedicated investor is almost always in a state of accumulation, and so the price action over the past few weeks is interpreted positively, as opposed to negatively. Reading the comments of new investors shows just how emotional these market participants are. Unfortunately, that needs to change, and fast! Being emotional as an investor has a way of never turning out well. Anyway, that’s it for this one. See you next time!
Disclaimer
First of all, I am not a financial advisor. All information provided on this website is strictly my own opinion and not financial advice. I do make use of affiliate links. Purchasing or interacting with any third-party company could result in me receiving a commission. In some instances, utilizing an affiliate link can also result in a bonus or discount.
This article was first published on Sapphire Crypto.
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