Welcome back,
In today's blog, I am going to talk about a scenario we are all witnessing right now in the crypto market. But before we dive into that, I encourage all new readers, especially those who are just stepping into the crypto world, please check out my recent blogs. In those posts, I have shared how to start your investment and trading journey, why setting targets in the market is essential, and how to diversify your portfolio in the best way possible. If you're interested in those topics, go ahead and explore my latest posts and they have been shared recently and you will find them right at the top of my blog list.
Also, in my blog that I published yesterday, I shared about the importance of risk management, something every crypto trader must learn. The crypto market is all about managing risk. If you learn to manage risk properly, you will learn how to make money consistently. So, be sure to check out that blog as well.
Ethereum Pumps
So, let’s talk about something we are all witnessing in the crypto market at this very moment. Right now, we can clearly see that Ethereum has pumped extraordinarily, especially when compared to Bitcoin, other altcoins, or even coins within the Ethereum ecosystem itself. So, what could be the reason behind this sudden movement?
While Ethereum has pumped by almost 10% in the last 24 hours, Bitcoin is still up by less than 3%, and this is something we generally don’t see in the market. Clearly, Ethereum is outperforming BTC here, but let’s try to understand why this might be happening.
Why is this Pump happening?
If you look at the market and try to find any news related to Ethereum, there hasn’t been any major news about ETH so far that could justify this pump. So obviously, something else might be going on and it could be risky for us in case we decide to react on it. Maybe whales are manipulating the market. Maybe some whales are aware of something big that is about to happen in the coming days, and they are quietly buying up Ethereum from the market.
And it’s not just about the 10% pump in Ethereum over the last 24 hours, but also the 25% surge we have seen over the past 7 days. That’s something we must keep in mind. A 25% pump is not something we should ignore for Ethereum, especially considering its market cap which has grown from around $360 billion to $400 billion. That’s a massive shift in valuation.
If you are active in the market, you are probably aware of Walter Bloomberg. A tweet from him recently stated, "GENIUS Act will pass tomorrow. Spoke to all holdouts today." This could potentially be one of the reasons behind the recent market pump. However, I personally don’t see it as a solid explanation, as it might be an attempt to trap investors especially the retail traders who often react quickly to such news. If it’s true that the GENIUS Act, which was recently rejected in Parliament, is now expected to pass tomorrow, then it would definitely be a good thing for the market but we still have to wait to know if that will actually happen as it got rejected once already.
What should you do?
So, what is the best thing to do right now? I will share what I personally believe is the right strategy. There are two options I plan to follow. The first option is to sell 10% of your Ethereum holdings so that you can buy back when the market corrects itself. I believe the market will eventually return to a lower support level, and at that support you can enter with the amount you sold again. But the big question is, will Ethereum consolidate at this level and will it go even higher? That’s why we are only selling 10% of our ETH so that even if the price continues to rise, we will still hold 90% of our ETH.
The second option is to simply hold your position and watch the market unfold. Don’t panic. You don’t need to act all the time and sometimes it’s best to just stay in your spot position and wait. One last piece of advice, please don’t get involved in futures trading at this moment. There could be serious consequences. Don’t get tempted to open a short position or even long positions. Stay calm and be wise with your decisions.
My thoughts
I actually think this might be a market manipulation for ETH because tokens from the Ethereum ecosystem haven’t reacted to this pump. I am personally holding ETHFI (Ethereum Finance ) and Lido, and neither of them has responded significantly to Ethereum price surge which is very unsual. So, I just hope this is a manipulation in play. That’s why, personally, I have decided to sell 10% of my Ethereum spot holdings and wait to see what happens. But at the end of the day, always do your own research and make your own decisions. I am simply sharing what I believe is the right approach and what I plan to do. The rest is up to you.
Conclusion
So with that, I would like to conclude my blog by saying that while Ethereum price has surged and excited us all, there is also confusion about the actual reason behind this pump to worry about. That is why, in this situation where we might feel that following the hype or price action is the right thing to do I have decided to hold on to my asset and sell only 10% of my spot holdings. I might be wrong and the market may go higher from here, but at the end of the day, it is my decision.
I know that by doing what I believe is right, I won’t have regrets later. Since I am not selling all of my Ethereum, there is nothing to regret anyway. The only thing I will have is satisfaction because I didn’t let my emotions take control. And I believe this is how we manage risk in the market and make decisions that protect and grow our investments. Anyways The call is yours, think of long term, and don’t get trapped in a situation where you might end up losing a portion of your money. Act wisely!
Thank You and Happy trading Everyone.
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