Crypto Winter survival guide pt.1
Want to get ready for the bull rally? Watch out for these signs.
Coo! It’s me - Crypto Owl, and I’m coming back with lighter content for today’s news (because yesterday was craaazy and dark, I know…).
For Today’s Menu:
🕛 Estimated reading time: 3 minutes & 12 seconds
🌭 YUMMY HOT DOG: 4 signs of the Bear Market coming to an end
🍬 SOME CANDIES: Top 6 Crypto News around the web
4 SIGNS OF BEAR MARKET END
We are still in the bear market. And it may get pretty exhausting waiting for a breakthrough, because no one knows when exactly it’s going to end (sadly, it will probably take a while).
Nonetheless, there are some signs that could help us indicate the possible end signal of the bear market. So, let's see what those 4 signs are.
First sign: 200-day average line
As you’ve probably guessed, we are under this line right now. And while we are under it - bear market won’t end for sure. 100%.
But, if the crypto market would go up and cross this 200-day average line, there is a chance that the bear market will start slowly ending.
However, it doesn’t mean that the bull market will start immediately. Sometimes, when the market crosses the 200-day average line, it rises in price a little bit, and then crashes again. So the outcome would be.. That we are still in the bear market. Just in a better one. Not that harsh.
For example, as the crypto market crossed this line back in 2019, its prices actually went up. For 6 months. And then crashed again. So, it is important not to get too excited and just stay rational as the market crosses the 200-day average line.
Second sign: Inflation rates
Yep, I know, I’ve already talked about it, but this is a good reminder that the crypto market is not immune to the sky high inflation rates, which are now dragging all the markets down.
What we have now is not very pleasant. Inflation rates keep swinging from 8.5% to 8.3% (which, at first, looked like a good sign) but, sadly, the May report showed that inflation rates spiked again to 8.6%, which meant that the inflation has not peaked yet. It could get worse, though we should wait for reports from the upcoming months to see if inflation rates are actually getting lower.
Why? Because, even if June's report will show that inflation rates are lower, they should stay lower for at least a couple more months in a row to show that actions taken have worked and inflation has been tamed. It would be a very promising signal, that would give enough hope to start talking about the end of the bear market.
And if inflation rates will continue to grow, well… Then forget about the bear market ending scenarios anytime soon.
Third sign: Energy prices
Energy prices going down - this is what we NEED and WANT to see. It will be another strong sign of the probable end of the bear market.
But why do we have such high energy prices?
No surprises here. The biggest mess was made when Russia invaded Ukraine (but of course, inflation has its part here as well). This war caused a lot of damage, and energy markets are not an exception, they were hit damn hard too.
It’s not likely we’ll see oil and gas prices falling down any time soon, however, there are two possible ways it might happen. End of the war is one of them. If that happens, there is a chance that energy market prices will stabilize. Or, another way is that the US and Europe start to fully use oil and gas from other countries like Venezuela. However, since energy prices depend on supply-demand models, the seller country can ask whatever price it wants. So, basically, nothing is clear here.
Fourth sign: Expect the unexpected (aka wild cards)
As I like to repeat in almost every newsletter, it’s hard to be certain of the crypto market: it's volatile, constantly changing, and has barely any regulation. What could possibly help the crypto market to explode again and break free from the bear market? My bet is on the events we simply wouldn’t expect.
For example, it could be an approval of Bitcoin ETFs (exchange-traded funds that track the value of Bitcoin and trade on traditional market exchanges). That would give investors less complex trading opportunities.
Another example could be that economically strong countries, like Switzerland, would adopt Bitcoin as a legal tender. That would actually be impressive and probably it would help to boost the crypto market out of the current situation.
To sum up, these are the four signs that could indicate a bear market coming to an end. But for now, I guess it would be best for all of us to prepare mentally, that this crypto winter period is not ending anytime soon. Hopefully, I am wrong. It’s better to stay positive, right?
TOP 6 CRYPTO NEWS AROUND THE WEB
A NICE COLD DRINK
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Disclaimer: This newsletter is strictly educational. None of this information is intended to be financial advice. Always do your own research and act responsibly with your profits.