What Defines a ‘Bullish’ Mood in the Crypto Market?
The crypto world can be a confusing place for newcomers. It’s full of new technical concepts and ideas, and there is a lot of jargon to get to grips with. It’s important you take the time to learn all you can, especially if you’re intending to invest in some crypto of your own.
Analysing the crypto market is key, but doing so successfully requires practice and patience. You need to be adept at things like monitoring Bitcoin values and keeping an eye on the Dogecoin price USD. We often hear the term ‘bull market’ used in the crypto industry. What defines a bullish market and how can you spot the signs of one? Find out below.
What is a Bull Market?
Markets of any kind can be incredibly difficult to predict. Whether you’re studying the stock market or the values of gold and silver, it can be nearly impossible to guess where things might be heading next.
The cryptocurrency market is no exception. In fact, it has a reputation as being particularly volatile and unpredictable. Part of this is due to how new these assets are, they are still stabilising and have yet to see serious regulation and control. Additionally, the technology that powers cryptocurrencies is always changing, which can cause wild market swings.
Markets go up and down constantly, but sometimes we see them go through periods of sustained growth. If this period of growth sees market value rise by more than 20%, with a preceding period of 20% market shrinkage, it is referred to as a bull market.
Conversely, an extended period when market values fall by more than 20% is what’s known as a bear market.
What Triggers a Bull Market?
Markets often reflect wider global economic health. The crypto market is no different. When the economy is strong, people are more likely to invest, so the market will grow as a result. On the other hand, negative economic conditions lead to a decrease in investor activity, and the market will shrink as a result.
However, bull markets are never the result of any one factor. Instead, they are usually triggered by a combination of internal and external causes, making them very difficult to predict. While external economic factors certainly play a part, events within the crypto industry, such as new technological developments, can also be contributory factors.
Should You Invest in a Bull Market?
If you’re a newcomer to the world of crypto and you’ve decided you want to dive in and start investing, it can be difficult to know when or where to begin. A bull market means the industry is doing well, which can be a tempting time to get involved. However, is this the right time to invest?
During a bull market, cryptocurrencies are higher than average. What this means is that if you buy now, you may be paying over the odds for assets you could get for less during normal market conditions.
Much of this depends on timing. If you invest at the very start of a bull run, you can see the value of your assets increase considerably in a short space of time. However, invest at the peak of a bull run and you’ll be paying higher than average prices which will depreciate rapidly afterwards.
Rather than investing in a bull market, investing during a bear market can actually be more beneficial. While bear markets are never fun for those involved, they present an opportunity for new investors to secure some crypto and a cut price, and the values should rise in the future.
Is the Crypto Market Bullish Right Now?
As we mentioned earlier, it can be almost impossible to predict if a bull run is going to take place. However, it is possible to work out if we’re in a bull market right now.
There are tens of thousands of crypto coins out there, analysing the price of each would be far too time-consuming and would see you get lost in the data. Thankfully, Bitcoin can serve as an accurate barometer of the crypto industry’s health. If Bitcoin is doing well, there’s a good chance most other assets will be doing well too.
Bitcoin is currently at a price of $26,504.80. If we want to work out whether or not it’s bullish, we need to look at its recent growth. Over the past month, Bitcoin has grown by 1.5%. Over the past 12 months, it has grown by an impressive 59.62%. This indicates that Bitcoin is indeed bullish right now, which suggests that the wider crypto market could be bullish as well.
If you want to start investing in Bitcoin, you’ll need to consider your decision carefully. Prices are high at the moment, but there’s nothing to say they won’t increase even further. If you want to play it safe, you could wait for things to turn bearish instead.
A crypto bull market is defined by a period of extended growth. Bull runs are exciting times for the industry and indicate that the sector is healthy and flourishing. It’s important that you learn about bull and bear markets if you want to start investing in crypto.