Crypto Capitulation: When will be the end?

We all want to buy the exact bottom and the exact top. Short term, long term and whenever. So we try to spot reversals in trends, trying to find the perfect timing. What may signal a bottoming reversal for the crypto market?

A wonderful case study was March 2020. We saw a huge spike in volume and an impressive reaction from buyers with tons of liquidations and margin calls. The crypto market (the index is “Crypto Total Market Cap”) saw a 32% decrease from the 10th of February to the 10th of March. And after that 50% decrease came. Taking into account the previous dump.

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The trade between buying low and buying when the trend is already reversed is significant. Especially in crypto, where we want to accumulate but we also want to follow the trend. In theory, we should buy the dips when the market trends are higher and sell the tips when the market trends lower. But the hard thing is to know what is the timeframe that we should be considering.

To build a better perspective, we tend to see the long term. But we must also zoom in, to see when we should buy and when we should sell. The trend signals the general picture and the fundamentals tell us what to pick. Then we should also consider some “pumpamentals”, in order to measure the reasons why something may pump in crypto.

Right now we are getting closer to an area where the price tends to recover fast. And we keep on printing higher lows and higher highs in the crypto market.

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It is really important to accept that we will not be able to predict the exact reversal . That is why we talk about DCA and why we need to buy step by step instead of going all in, all of the sudden. We will keep updating.

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