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Like in other financial markets, there is no way you can predict the best moment to buy cryptocurrency. Thankfully, crypto experts and experienced investors have mastered certain tricks, which help them get maximum benefit from crypto volatility. For instance, tracking the dollar-value averaging can help you out a lot.
In this article we are going to give some insight on how you could make volatility work in your favor. Please be aware that this article bears exclusively introductory and educational value. In our introduction, we do not look to give any investment advice. Always be critical and make your assessment, whether any of the strategies and theories fit your financial means and eventual purposes. If still hesitating, address a professional business analyst.
Back in the day, cryptocurrencies like bitcoin faced very high price volatility with the market value fluctuating in one day, sometimes even in a single hour. From the perspective of investors, such rigid fluctuations may cause a lot of anxiety and uncertainty about the consequences of their actions.
Mind the dollar-cost averaging (DCA)
DCA is an investment tool, designed to alleviate the influence of market volatility by making investments of set installments under a regular schedule (for instance, buying $100 of bitcoin once a week). The DCA technique is not new to the crypto industry. Experienced investors have been employing this tool for many years to leverage market volatility.
When the bitcoin market price is down, that $100 will get more bitcoin, giving way to a higher gain if the market gets better. And otherwise – if the market is up, that $100 will buy less bitcoin, decreasing the risk of loss in the market situation changes the other way around.
Thus, DCA can be helpful in managing your cryptoassets without any concerns about investing a considerable amount of funds at a fixed price at a certain point in time. Moreover, adhering to DCA method delivers the extra benefit of adjusting these funds up and down at any moment. Anyway, if you are thinking of employing DCA in your investment activity, you should first figure out whether DCA is suitable in your investment circumstances. In case you have any doubts, please address a professional investment consultant.
Recurring buys on Coinbase
Using DCA to favor your investment experience comes even easier with recurring buys on Coinbase. All it takes is to specify the asset you seek to purchase, indicate the amount, and choose the schedule (daily, weekly, or monthly). Coinbase will then recur the purchase automatically until you change or cancel it.
Predicting the market fluctuations is next to impossible, and crypto industry can appear very volatile. Using DCA, you can largely benefit from this volatility. With Coinbase it takes nothing to set a recurring buy. Go ahead today!
In its essence, Coinbase is not an investment consultant or fiduciary, and it does not provide any advice related to this issue. The content above is delivered with exceptionally informational purposes, and Coinbase does not make any consultancy on this account. As it happens to any currencies, cryptocurrencies can fluctuate dramatically and thus incur a substantial loss, involving the loss of the entire investment.
In this, you should make your own decision whether to buy or sell crypto and whether they suit your financial circumstances, before taking part in any transactions.
Other ways to deal with market volatility
According to financial experts, market scalability is the core reason why many transactions on the crypto market are delayed. This problem became the reason why MetaHash created a network, which can solve this problem and initiate significant developments in the industry.
The conceptual philosophy of #MetaHash will bring benefits to the industry, as it will enable users to commit billions of transactions, avoiding the need for purchasing expensive equipment. Thanks to the #TraceChain protocol, #MetaHash network ranks as the quickest available, with short confirmation times and extremely low transaction fees.
With blockchains becoming more extended, more and more investors find themselves in a situation when they have to wait in a queue to complete a transaction. Delay of operations can cost quite a penny as the crypto market is Volatile. With #Metahash, investors will not have to give up their investment opportunities by posting in time.