Do you find crypto terms hard to understand?
We hear you. It’s a jungle out there.
If you’ve been trading crypto, you’ve probably heard a thing or two about the market menagerie of “bears”, “bulls”, and “black swans”. Just like the buzz you hear in traditional financial markets, bull markets, bear markets, and black swan events can make a massive impact on crypto investors’ mindsets.
Let’s begin by unpacking the Bull Market.
Here’s a fun fact: Why call an upward trending market a “bull” market? The next time you see the persistent and plodding Taurus (or a picture of one in the world of Google images) notice how the beast thrusts its horns up proudly into the air.
Many would say that Bitcoin is currently in a bull market with prices strengthening steadily since mid-October, breaking the $15,000, $17,000, $20,000 levels… and then some. On Dec. 17, 2020, Bitcoin prices hit a new ATH record at $23,000. Will we see Bitcoin break past $24,000 by the end of this year?
On the opposing end of this yardstick, meet the Bear Market.
Imagine a bear striking down its opponent — swiping its paws downwards before conquering its prey. The term “bear” is used to describe falling prices, partly because of the way this beast takes down the weak.
But hey, it’s not all doom and gloom here. One could tame the bear — at least when trading crypto derivatives on Bybit — using functions like Take Profit/Stop Loss.
In any case, whoever coined the phrase “there is opportunity in crisis” must’ve had these events in mind. (One can hope!)
Speaking of crisis and rapid price drops, does anyone remember the “3.12” Bitcoin Crash?
We’d consider that a Black Swan Event.
In March 2020, Bitcoin lost half of its value in a two-day plunge and fell below $4,000 for the first time in seven years. Analysts blame this price plunge primarily on the coronavirus outbreak which hit the global economy and led investors to hoard cash for safety.
Imagine if you entered the crypto market soon after this black swan event. Since March, Bitcoin prices have soared by more than 500% to where it sits now — flirting with the $23,000 handle.
No use crying over spilled milk, though! With 2021 just around the corner, how are you feeling about the crypto market? Head on to Bybit’s Official Instagram for our latest poll!
*As promised, the answer to last week’s trivia, “Which altcoin is largest by market capitalization?”, is Ethereum! Did you get it right?