6 Essential Strategies For Assessing the Crypto Market

Cryptocurrencies have taken the world by storm. These exciting new digital assets have promised to completely change the way we think about and conduct financial transactions, and we’re seeing them revolutionise a wide range of different industries.

If you want to get involved and start investing in and trading crypto, you’re not alone. We’re seeing huge numbers of new participants, but it’s vital that you know what you’re doing before you proceed. Assessing the crypto market goes beyond merely checking the BNB price, so we’ve written up a guide with a few key strategies to get you started. Check them out below.

Price Analysis

At the end of the day, the value of an asset is the most important thing to keep in mind when you’re deciding whether or not to invest. However, it’s not simply a case of checking the price that day and basing your decision on that. You need to analyse on a deeper, more detailed level if you want to ensure you are making the right move.

Checking the price on a given day is important, but it’s not as vital as checking how an asset’s value has performed over time. Look at the changes over the past week, month, and year. You’ll be able to see whether the asset has grown or fallen, and by how much.

This information is key. It will allow you to make more accurate predictions about where an asset’s value could be heading in the short and long term. Armed with this info, you’ll be able to make a more informed decision and you’ll be more likely to see a return on your investment.

Industry News

Accurately assessing the crypto market means having to stay abreast of everything that’s going on. The crypto industry is fast-moving and constantly changing, news stories break every day, and these can have a significant impact on coin prices.

Regulatory news is increasingly crucial. For example, a recent SEC ruling has given hope that crypto firms can escape regulation, news that saw prices grow across the board.

You should also be looking for news related to specific cryptocurrencies. Updates to technology and blockchain platforms can send prices skyrocketing, so ensure you are signed up to mailing lists and active on social media, forums and message boards.

Global Events

The crypto market, like any other kind of market, can also be affected by external global events, even if they are seemingly unrelated.

For example, the war in Ukraine has had an impact on the market. Cryptocurrencies are being used by involved parties to raise funds and bankroll operations. Additionally, widespread economic downturn as a result of the conflict has muted investor confidence, leading to a dip in crypto prices.

If you want to analyse the crypto market, it is absolutely essential that you are aware of what’s happening around the world and how these global events can influence the sector.

The Bitcoin Barometer

One key strategy that you should always remember when assessing the crypto market is that Bitcoin can be used as a barometer.

Bitcoin is the largest and most popular cryptocurrency, and as such it has incredible influence over other coins. When Bitcoin is performing well, there’s a good chance other assets will be as well. Conversely, when the Bitcoin price is faltering, this could indicate that other coins are also struggling.

Checking the Bitcoin price and analysing its value can be an excellent way of quickly assessing the strength of the wider industry. This is the perfect starting point before you dive in and start analysing in more detail.

Check Different Platforms

There are countless crypto platforms and exchanges out there, each of which can be used to both assess the market and buy, sell or trade cryptocurrencies. It can be easy to find a platform you like and stick to it, but if you want to get a clearer picture, you should explore different tools and use them in your assessment process.

Different platforms will use alternative analysis tools and can display slightly different results. By collating this information, you can build up average figures that give a more accurate representation of the market.

Furthermore, using a different platform might give you access to new options. You may be able to look back over a longer period of time or hone in on specific time frames for detailed, minute-by-minute analysis.

Buy Low, Sell High

The final strategy in our guide is buy low, sell high. This is more of an investment strategy, but it’s impossible to get right without effective market assessment beforehand.

If you’re going to invest in a cryptocurrency, you want to buy when the price is low and when you’re confident it’s going to grow in the future. This means you’ll be able to buy assets at a cut price and then sell for a profit at a later date.

This strategy is all about timing, and you won’t get it right all the time. This is why it’s important to set a budget and ensure you are never spending beyond your means.

Conclusion

Use the strategies we’ve outlined in the guide above to effectively analyse the crypto market and make the right investment decisions.

This information is of a general nature only and should not be regarded as specific to any particular situation. This should not be taken as financial advice to buy, trade, or sell cryptocurrency or use any specific exchange. This is not intended for use as investment, financial or legal advice as each individual’s need will vary.
Binance Australia is not affiliated, associated, endorsed by, or in any way officially connected with any individual or organisations mentioned in the article. Binance Australia is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly by use of this newsletter and expressly disclaims any and all liability for any loss or damage you may suffer.