As the crypto market shows signs of entering a bull phase, investors and enthusiasts are keenly looking for strategies to capitalize on the potential opportunities.
As a retail investor, there several ways you could benefit by acting on things starting today.
Let’s look at a possible approach.
Understanding the crypto market dynamics
A bull market is characterised by rising prices and increased buying activity, often driven by positive sentiment, technological advancements, or macroeconomic factors. To successfully navigate a bull market, it's crucial to understand these dynamics and the factors that influence crypto asset prices.
According to Rekt Capital, the peak of the bull run will happen 518-546 days after the halving. This implies that it is safer to start accumulating whenever we notice a dip and maximize around the peak time, typically between Sep-Oct 2025.
Source: https://twitter.com/rektcapital/status/1764592817123237908
Understanding money flows in crypto
We are currently at Phase 1 of new cycle where Bitcoin surges and leaves every other asset behind. Next, Ethereum, Solana, and associated ecosystem tokens should do well. This phase may occur only weeks after the halving in April 2024. Post riding these assets, the whales rotate money into other large caps (top-25 crypto assets). Finally, random coins start doing well signifying a possible end of the cycle.
Illustration: Money flow in crypto
Adopt a focussed investment strategy
Developing a clear investment strategy is pivotal. Decide whether you're a short-term trader or a long-term investor, as this will dictate your approach to market analysis, asset selection, and risk management.
Look for projects with strong fundamentals, clear use cases, and the potential for long-term growth. Diversification across different crypto assets can reduce risk and enhance portfolio resilience. At Giottus, we have staking, fixed rewards for long-term investors to sit back and earn passive returns of 2% to 20% and SIPs to develop a disciplined investment habit.
For short-term traders, the key is to focus on learning technical analysis to identify buying and selling opportunities based on chart patterns and trading volumes. This is tough to learn but can be rewarding.
Don’t go deep into the memecoin rabbit hole!
If there's one lesson we can glean from the past few chaotic days, it's that memecoin mania is back. Coins like FLOKI, PEPE, and WIF have registered gains ranging from 200% to 400%.
Memecoin surge. Source: TradingView
Retail investors tend to be particularly active in this segment of the market, often playing their cards excessively. We urge our users to proceed with caution when dealing with these type of coins, as they may fluctuate and experience significant surge or steep decline. The key here is to ‘time the market’ which is often very tough. Only allocate <2% of your portfolio in them and be ready to lose it all in terms of risk.
Do your own research
During times like these, we may come across many influencers, bloggers, enthusiasts that promote few coins. While some of these are organic, most of them are actually paid to shill some random coin that has no intrinsic value.
Regulatory changes, in particular, can have a significant impact on the market, making it important to understand the legal landscape of the countries where you intend to invest. Stay abreast of market trends, regulatory developments, and technological breakthroughs by following reputable news outlets.
Understand the tax implications of your crypto transactions. In India, the capital gains from crypto trades is taxed at 30% and every sale of crypto incurs 1% TDS.
Key takeaway
As we stand on the brink of what many believe could be another significant bull run, the importance of preparation cannot be overstated. By educating yourself, developing a solid investment strategy, practising risk management, and maintaining discipline, you can increase your chances of success.
Remember, while the potential rewards are substantial, so are the risks. Approach the market with caution, research, and a clear plan.
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Disclaimer: Crypto-asset or VDA investments are subject to market risks such as volatility and have no guaranteed returns. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.
