For a lot of experts and seasoned investors in the field of cryptocurrency trading, the best way to make a reasonable and sensible investment decision is through thorough analysis of stock price and other core factors. More often than not, forecasting of the cryptocurrency prices serves as one of the keys to a good investment choice. Taking that into consideration, it may be safe to say that cryptocurrency trading is nowhere near complicated but the truth is it is still tricky and requires fundamental analysis. Failing to do so might leave you consumed by regrets. Let me help you avoid that path by considering these facts, tips and insights below:
- When you invest in cryptocurrencies, it is like you are investing in commodities. While commodities can be used as assets in the real world and can be invested through open market exchanges, cryptocurrencies can, in the same manner, be treated as financial and insurance assets but are also used in investments. Because of this nature, it is highly essential to consider the usage and added value that cryptocurrencies create when you choose which cryptocurrency option to invest in.
- There is a rise in cryptocurrency usage and collective market cap can prove it. Figures show that there is already over $60 billion worth of cryptocurrencies in the world to date. This accounts all cryptocurrencies that exist nowadays including Litecoin, Ethereum, Ripple, and Bitcoin along with other hundreds of not-so-popular cryptocurrencies. This just indicates that crypto is nothing like a scam. It exists. It is real.
- At the moment, only a few percentage of the world’s population uses cryptocurrencies. Many are still unaware about them and this is something you should take advantage of. As a matter of fact, Statista’s data show that only 24% of adults in the United States alone are familiar with Bitcoin being the most popular cryptocurrency at the present. And although 24% is accounted for, only 2 per cent of them are actually using Bitcoin while the rest are still considering of using it in the future. This should excite you if you are planning to invest not just in Bitcoin but for other cryptocurrencies as well.
- As an investor, one of the core factors I mentioned above that you should value the most is the usage rate of the cryptocurrency you are eyeing on. Usage is one fundamental data that should be included and considered in your analysis. The supply and demand rule still works and, so, should be focused on too.
Furthermore, you should also take into account the supply of cryptocurrency circulating as well as its trade volume.
- Know where your chosen cryptocurrency belongs in the market cycle. Although Bitcoin leads the raise, it is not necessarily useful and advanageous to consider it as an investment opportunity even if prices can go much higher from what they are at the present. In fact, there is still a chance that other less chosen cryptocurrencies which are still starting out can rise up enough to compete with the leading stock. Observe what other businesses are considering. Their common choice must be there for a reason.
- A good cryptocurrency should be able to solve a problem in real life. Otherwise, it will no way return an investment. It just won’t. Remember, the better it is at solving problems, the more its potential value will rise and that is where europhia can be experienced in your investment journey.
- The hype in altcoins is just like the hype in dotcom and most likely, 80% will not survive the game. Why? Bear in mind that when there is hype, investors and users tend to lose focus on the real added value that is created. As an investor, it is important to acknowledge this added value from a society member’s and businessman’s point of view when you are choosing which cryptocurrency to invest in.
- Cryptocurrencies can be exchanged for traditional money. At the present, the entire world’s markets are slowly on the process of enabling these exchanges and sooner or later, this will be realized. With this, it is safe to say that storing cryptocurrencies is just another means of storing cash.
- Including a limited number of cryptocurrencies in your initial investment portolio is highly recommended. For a lot of experts, this is the way to go but you have to choose selectively. By this I mean only invest in cryptocurrencies that you fully know without allowing your emotions to rule you. Only then it is possible to come up with rational financial decisions.
- Rely on the right sources. Base your decisions on facts, not hear-says.