To illustrate the current economic fiasco in simpler words, the prevailing condition of the global economy has only worsened post covid. When the situation gave out signals that things may go south, traders and investors took out substantial chunks of their entire wealth. They invested them into more contemporary approaches such as Cryptocurrencies.
Let’s face it, the concept of cryptocurrencies is so significant that anytime someone hears the name or when someone is discussing the concept, a third person may join in since the idea is so alluring. It has undoubtedly demonstrated its strength throughout time, and its acceptability, scalability, and profits have surpassed those of any other market. Although the market follows the same charts as every other market and has assets in the form of tokens and coins, its volatility may be higher than any other market. You probably already know what bears and bulls are if you’re a potential trader or a seasoned expert. And how does the market behave when bulls and bears rule it? If so, consider yourself unlucky, but let’s speak about what occurs when the bears take over for those who are just getting started in the market.
As the Bears gradually increased their dominance, cryptocurrencies, too, saw a price decrease. This situation is exceptionally advantageous for those who are just entering the market. Still, for those who had already purchased assets prior to the decline or for those who purchased assets in the interim believing that this might be the end and that prices would rebound or that the bulls would take control, the value of their investments has also decreased, giving rise to the idea of HODL, or holding on for dear life as the name suggests. A trader follows HODLING even after the bulls have seized control of the market, not just when it is trending lower. This indicates that they are holding out for a price that would enable them to sell the cryptocurrency token. Still, in relation to the current market conditions, the bears have promoted HODLING. Let’s get into the topic at hand and describe what forced hoarding is like for our readers.
Another element that interacts with the idea of HODL is FOMO. You might be asking now how the two concepts are related, aren’t you? The answer is that, in line with the general trend, your wallet holdings tend to decline when the bears take control. Here is where the trader hangs on for dear life yet occasionally commits mistakes like FOMO or fear of missing out. The trader makes the same errors and decides to liquidate their wallets when they notice that everyone else is doing it in an effort to salvage what’s left. FOMO is precisely this. It is crucial to realize that maintaining emotional control and not letting FOMO get the best of you is essential to getting the most out of your investments.
As a result, if bears have had a substantial impact on your project, set some reasonable goals and save them in a secure ledger. If you follow these steps, you will be well on your way to being a HODLER. The most important aspect of the HODL philosophy is to scale out and always focus on the big picture rather than on short-term gains. You’ll also remove a lot of stress from your life.
Everybody has a distinct ultimate objective. Some contend that you should HODL your currency until it is worth a specific sum, at which point you should sell it and profit. However, there is always the chance that prices may increase more after you sell, and you will regret not holding out for longer.
Others suggest keeping your coin until it is genuinely usable as money and you are not concerned about selling it back. You’ll be able to spend what you currently have instead. The issue with this is that only some currencies are created equal, and no one can predict the future or ability of any cryptocurrency to function as a full-fledged currency.
I am a financial analyst who shares views only for the purpose of learning and information. I am not your advisor, nor should you take any trade based on my workings. Always consult your independent financial advisor before entering into any financial trade. I assume no loss or damage caused by any trade the market participants took.
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