By Thomas Jackson
Although the cryptocurrency market is still volatile, many small and large-scale investors are choosing crypto as their investment vehicles. Currently, there are over 7 thousand cryptocurrencies on the market. And you can find hundreds of tools to facilitate the use of each – for example, crypto bots to copy trade binance.
A crypto trader may choose to invest in any of these currencies for trading purposes but the main question most of them ask is how long they should hold. Many crypto trading experts say the answer entirely depends on expectations from the investor. Nevertheless, the following answers will help you get a better-informed answer.
The time you bought your cryptocurrency
The reason why you want to sell your crypto is that you expect to make a reasonable profit and that is the essence of every business. According to experts, you buy crypto when the prices are bearish so that you can hold until the market becomes bullish.
If you look into the crypto market currently, the prices of most dominant coins have been going down tremendously since about May 2021 but have shown a tremendous rise in the last couple of months. Some coins nosedived to between 50 – 70 percent. It is only recently that the prices have begun to rise again. Some of the coins had already skyrocketed beyond the price they were selling when prices began to crumble down.
There are two types of investors here and they both present two entirely different scenarios. There is the investor who bought crypto a few days before their prices became bearish. There is another who bought when the prices had gone down to about 50 percent and immediately the prices became bullish.
The latter investor has already made 100 percent of their investment because they bought at the right time. The former investor cannot sell yet but they have to wait a little longer to make a reasonable profit. The first answer as to how long you should hold is the time you bought your crypto and how the market behaved immediately after.
The reason why you bought
According to finance and economics writers for an essay writing service, investment is like a saving that is growing and increasing in profits. People choose certain investment vehicles for various reasons. Some want to invest because of a project they are anticipating to start three years away. Others invest for pure speculation and still, others do so because they want a consistent line of income.
These factors are applicable in the crypto market. Traders enter this market envisioning something and that is what keeps them into the market even when the signs seem negative.
If you are in the crypto market for speculation, you cannot have a definite time to hold or sell your investment. You might hold them for a few hours, a week, a month, etc., before you sell. These are the kind of investors who stay alert always and the moment they make a profit, they quickly sell and buy another type of crypto coin.
Another individual might have bought their crypto as saving for a certain project. When the time for the project comes, they will sell their investment and use the money on their planned project. For this type of trader, it might not matter the amount of profit they make but what matters most in the project.
The other type of trader is the one who buys crypto because they want a consistent line of income. Such an individual will hold the cryptocurrency until the need for more income comes.
They may sell all and buy another type of coin or sell the part to cover only their current budget. The reason why you bought your cryptocurrency can determine how long you can hold it.
Advice from crypto trading experts
According to Coinmarketcap, the current cryptocurrency capitalization stands at about $2.65 trillion. This is a consolidated value from more than 7,000 different cryptocurrencies. Most new crypto traders might only choose the most common five or ten types of cryptocurrencies, but that is not all there is in the crypto market.
Crypto trading experts and brokers help new and established traders to make profits and invest in crypto that will likely make a profit sooner. If you decide to get a consultant to help you trade in cryptocurrencies, they will be important before you make any decision to buy or sell. How long you can hold your cryptocurrency will all depend on the advice they will give.
There is another more promising crypto
Business is always about profits and you put your money into the most promising investment. Sometimes you can buy your crypto intending to hold it for long-term. After about six months, you might study the market and realize there is a more promising currency. Even though you have decided to hold for longer, you may decide to sell and buy the more promising crypto.
The market looks uncertain
The crypto market is very volatile because it’s still young and more people have been joining the market recently. As a result, it might look very promising but the fact is that it’s still a very volatile market.
You can buy and hold your crypto but if you start to feel anxious because of uncertainty in the market, you don’t have to hold longer and lose your money. You can decide to sell and buy again later.
After you’ve made a reasonable profit
Every trader ventures into business for the sole purpose of profits. When there is high uncertainty in the market, you weigh all options and decide if you want to stay on or exit. In the crypto market, what matters most is the profits you make.
You might have bought your cryptocurrency when the price was at $10 per coin. Three years later, the price might be trading at $60, which means you already have a profit of $50. Because you have your profit, you can decide to let go and sell.
The cryptocurrency market is still a volatile market and traders need to enter or exit it with care. Your decision as to how sooner or later you want to exit entirely depends on the reason why you joined the market. Regardless of the reason for joining, every trader wants profits and as soon as they get a profit they are comfortable with, they can sell and buy different crypto on trading sites or platforms for automated crypto trading.
About the Author
Thomas Jackson is a professional freelance content writer working with A writers and Essay on Time. He is working with another agency that’s regarded as the best writing service. He’s a member of writing clubs in NYC and loves writing songs. He feels motivated to write songs and other work from his friends, family and popular artists.