How To Take Advantage Of DIP In the Cryptocurrency Market ?

ūü§ĒWhat¬†is meant¬†Dip in crypto market ūü§Ē
In cryptocurrency, the dip is defined as a sudden and sustained drop by price.This is a vast definition because whether or not a cryptocurrency is dipping really depends on its general volatility.

During a¬†Bull Run¬†just like the¬†one we‚Äôre in now,¬†it’s¬†normal for Bitcoin‚Äôs price¬†to travel¬†up or down by 5 percent per day and go up or down by 10 percent or more on a weekly basis.

Read Also: Most Trusted And Best Crypto Exchanges List For 2021

For altcoins,¬†it’s¬†normal¬†their¬†prices¬†to vary¬†by¬†quite¬†10 percent per day,¬†and that they¬†can easily gain or lose¬†quite¬†20 percent of their value¬†hebdomadally¬†.

ūüĒéWhat Causes Dips?ūüĒé
This is important¬†to understand¬†if¬†you’re¬†trying¬†to shop for¬†the dip, because¬†watching¬†the worth¬†charts alone¬†won’t¬†offer you¬†enough context¬†to form¬†the proper¬†call.

The problem with identifying causes in crypto is that¬†it’s¬†very rare¬†that you simply¬†can definitively point to¬†one¬†factor.

Usually there are multiple factors causing a dip, and every of those often cause overlapping chains of events which will become a vicious feedback circuit .

ūüĎõAltcoin DipsūüĎõ

As many of you already know, altcoins are highly correlated to Bitcoin.This is important to recollect during dips because no amount of bullish news can save your altcoin if Bitcoin is in freefall.

Altcoins are more volatile than Bitcoin, and this suggests that whenever Bitcoin dips and decimates altcoins, the profits you’ll get from buying the dip are going to be even larger for altcoins.

This is because¬†they’re going to¬†rebound¬†far more¬†aggressively than Bitcoin once it finishes dipping and BTC dominance returns to its downtrend.

ūüėĪHow Low Will The Dip Go?ūüėĪ

Again,¬†tons¬†of¬†this may¬†depend upon¬†the factors that are causing the dip, and¬†there’s¬†no way of knowing¬†needless to say¬†where¬†rock bottom¬†of the dip actually is.

However, there¬†are not any¬†shortage of tools¬†you’ll¬†use to estimate how deep a dip could get,¬†and every one¬†of those¬†are often¬†found on the trading terminals of your favorite cryptocurrency exchanges.

If the whole crypto market is dipping, then your main area of focus should be the BTC/USD chart albeit you don’t hold any BTC. Identify levels of support on the weekly timeframe to ascertain where it could fall.

ūü§ĎHow¬†and when you buy for¬†The Dipūü§Ď

The daily time frame typically offers the simplest viewpoint for purchasing the dip. like the weekly timeframe, the primary thing to seem for is visible signs of support.

The thanks to spot these zones of support is by watching where prices have clustered within the past, and this is often often much easier to try to to on the daily timeframe.

When you combine the EMA, Bollinger Bands, and RSI, you ought to get a transparent picture of whether you’re at rock bottom of the dip within the short term.

You can¬†countercheck¬†to form¬†sure the dip¬†is basically¬†over by using the MACD and trading volume. The MACD should show a trend reversal and sometimes¬†you’ll¬†spot it¬†within the¬†trading volume¬†also¬†.

Read Also: This Mysterious Whale Account Has 28% Major Hold Of Dogecoin (Doge), This Can Be Risk For Retail Investors !

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