6 Things to Do Before Crypto Bull Run

The crypto winter has been influencing the industry for quite a long time now. However, a lot of market players are eagerly waiting for this situation to change, and hope that the next crypto bull run will bring them profit. 

This article is going to help you prepare for the next period of market activity to take the biggest advantage.

What is a crypto bull run?

A crypto bull run is a phase marked by substantial price surges in various digital assets. Within this period, market sentiment predominantly leans toward optimism, as both investors and traders are confident in the potential for cryptocurrency values to increase.

Cryptocurrency prices can surge at rates often far outpacing traditional financial markets. This rapid price appreciation attracts both new and experienced investors, making the demand even higher.

During these phases, trading volumes also tend to rise as more individuals engage in crypto trade. This increased activity can result in heightened market liquidity and volatility.

Usually, crypto bull runs are accompanied by optimistic news and discussions about cryptocurrencies in media, on social networks, etc. This positive sentiment also works toward bringing in even more investors, especially because they fear to miss out.

However, this does not mean that during bull runs prices only increase. Because the crypto market is inherently volatile, this increased activity only enhances this aspect. Prices can experience significant fluctuations, with both rapid gains and corrections.

Timing market cycles can be extremely challenging, so it is vital for all crypto investors to have robust strategies for both bullish and bearish market states.

How to predict the bull run?

Foreseeing the start of a crypto bull run is a complex task, but the patterns we saw in the past can provide some insights. The most recent bull run in the crypto market occurred in 2021, characterized by substantial price growth and market excitement. Previous bull runs in 2013 and 2017 also left their mark on the industry.

One crucial factor to consider is the Bitcoin halving. This event happens approximately once in 4 years, with the next one expected in spring of 2024. Previously, Bitcoin halvings have preceded bull runs (in 2012, 2016, and 2020). 

Nonetheless, the cryptocurrency market has progressed beyond its initial reliance on Bitcoin, with DeFi innovations, Web3 platforms, and other blockchain technologies gaining substantial traction. As the market continues to mature, investors are displaying a growing fascination with the pragmatic applications of crypto protocols, actively seeking solutions to real-world challenges.

While the widely recognized four-year cycle theory holds merit, it's crucial to acknowledge the intricate nature of the market, influenced by a multitude of factors. The market's diversification has opened doors to opportunities that extend beyond Bitcoin and other prominent cryptocurrencies. 

Other signs to look out for are the increasing interest from mainstream media and investors who specialize in traditional assets, growth in the trading volume of many crypto assets, and some important events that threaten traditional finance mechanisms. For instance, during the COVID-19 pandemic, many people decided to turn to crypto because of the uncertainty in traditional finances.

How can investors prepare for the next crypto bull run?

Now let us have a look at what investors can do during the bear market:

1. Education. Use the time to learn before the wild activity starts: understand the technology, types of cryptocurrencies, and the market dynamics. Knowledge is any investor’s most potent tool, our Blog can help you with this task.
2. Clarify your objectives. Are you aiming for immediate profits, long-term accumulation of crypto assets, or the expansion of your portfolio? Establishing SMART goals (Specific, Measurable, Achievable, Relevant, and Time-bound) will provide clarity and maintain your focus.
3. Mitigate risks effectively. A robust risk-management strategy should incorporate stop-loss orders, diversification of your investment portfolio, and the principle of investing only what you can afford to lose. This approach acts as a safeguard, shielding your invested capital during periods of market volatility.
4. Think about security. Opt for well-known crypto wallets and exchanges that offer robust security features. Enhance your protection, for instance, by using hardware wallets for long-term storage.
5. Prioritize networking. Join crypto groups, attend conferences, and network with experienced investors. Talking to other crypto investors can give you valuable perspectives and insights.
6. Stay emotionally balanced. Impulsive decisions based on fear or greed are investors’ worst enemies. Your strategy should help you avoid making big mistakes.

To sum up, in order to make your investments as profitable as possible, you should get ready to take advantage of the market cycles in advance. It is easy to lose sight of a half-baked strategy when things get emotional, so make sure to keep your goals in mind. Also, remember to always do your own research in investment decisions instead of relying on one or two sources.

SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.