- Should we invest in Bitcoin ?
- When is the best time to buy cryptocurrency ?
- Every body’s first question is : Should we invest in Bitcoin of the year 2023 ?
- Or another similar question: When is the best time to buy cryptocurrency ?
Cryptocurrency experts says not everyone knows about the best time to buy Bitcoin. Recent studies have revealed a surprising timeframe with the most returns to buy Bitcoin.
When is the best time to buy Bitcoin?
Historically, Bitcoin has yielded higher returns on Sunday evenings and early Monday mornings, according to Capriole’s digital asset manager, Charles Edwards.
Edwards said, “Bored on Sunday night? Here’s the best time to buy Bitcoin”.
Why the end of the weekend?
There are several reasons why Bitcoin, the boldest cryptocurrency, is outperforming on the weekends:
- First, Bitcoin typically registers lower volume over the weekend, and ends with increasing the chances of high volatility.
- Second, traditional markets that facilitate Bitcoin trading, such as the CME, are closed during the weekends. When they open, a sudden increase in volatility is possible to happen.
As a result, dwindling BTC trading volume and closing markets make Sunday nights the best time to buy Bitcoin.
Is it possible to reach an exact “Market Timing?”
Timing is essential in financial markets because it is of great importance to monitor the rising and declining investment instrument, and to trade at the right time accordingly.
Market timing is an action that every investor dreams of and 99% of them try to apply, whether they admit it or not. Buying low and selling high would be nice, wouldn’t it?
All the traders think that they would let the market fall a little more, then they would buy; after the election, they would sell; or during the crisis, they would stay outside.
To be honest, if you had bought some stock at the bottom of the 2008 crisis, you could reach your corner now; or if you had bought so many of the stocks during the 2001 crisis, you would now be surfing in Hawaii.
But look what John C. Bogle, founder of Vanguard Mutual Funds, says about it:
It would be nice to sell when the market is at the top and to buy when the market is at the bottom, but in my 55 years of business, I have not seen anyone who knows not only how to do it, but also someone who knows how to do it.
However, there is a strategy advised by experts which is called Dollar Cost Average!
What is Dollar Cost Average (DCA)?
There are many strategies in the investing world with varying risk ratios. Among these strategies is dollar cost averaging, or DCA, designed to build wealth over time.
It is defined as an investment approach that eliminates the necessity of making just-in-time transactions in the market with periodic asset purchases.
Dollar-cost averaging can be viewed as a convenient trading way without any need to identify the best entry point in a volatile market. In this strategy, the capital is spread over predefined ranges, so the purchases may be made during the investment period and would drive the average price to a more reasonable level.
It is indeed a much better strategy than buying in bulk at the highest price.
In essence, it can be said that dollar cost averaging is a suitable strategy for those who are new to the industry or for investors who do not want to concentrate on technical market analysis.
A brief review of the past trading timetable
For example, on July 25 and 26, the BTCUSD pair on Binance recorded daily volumes of 40,000 BTC and 65,000 BTC, respectively. Then, on Monday—that is, on July 27—the volume suddenly spiked to 150,000 BTC; coincidentally, the price of Bitcoin also increased by 11%.
Due to the low Bitcoin trading volume over the weekend, BTC also tends to see sudden pullbacks. For example, on Sunday, August 2, the price of BTC suddenly dropped 6% overnight. This resulted in a slight increase against the aforementioned data.
Accredited and institutional investors using the CME Bitcoin futures market will have to wait until the market opens on Monday. This can cause sudden increases in market volatility.
Comparing the crypto market with the traditional one
Unlike traditional assets, BTC is possible to trade on exchanges on weekends and holidays. Therefore, when the CME closes and opens on Monday, there is usually a gap between the prices, so the best time to buy Bitcoin is different from the best time to trade in the traditional markets.
On August 2, more than $1 billion in futures contracts disappeared when BTC dropped 6% in hourly trading. Coincidentally, this happened on the closing weekend of July, when the CME Bitcoin futures contract closed.
In recent weeks, interest in the CME Bitcoin futures market has grown significantly, which is probably because of CME’s increasing way and its influence on the global Bitcoin market.
What is the best time of day you get Coins?
Today, the most active trade time in terms of volume is 16:00 in the UTC zone. However, the best time of day to buy and sell in terms of volume is 16:00 in the UTC zone today.
How to understand that a cryptocurrency will rise in price?
When investors buy cryptocurrencies, if there is more buying in that minute, crypto prices will encounter a sharp rise and with a better-than-expected price.
However, if the purchases are replaced by gigantic sales, red graphs are drawn one after the other.
What does crypto’s 4-hour close mean?
Cryptocurrency 4-hour closing hours start at 07:00 and progress every 4 hours. Accordingly, 11:00, 15:00, 19:00, 23:00, and 03:00 hours are the 4-hour closing hours.
What does coin leverage mean?
In this context, futures and leveraged trading in cryptocurrencies is a financial system that allows trading up to 100 units with one unit in some types. This system provides high-profit returns by risking the invested value in some types of debiting.
Why to trade cryptocurrency?
The cryptocurrency industry, generally not regulated, has presented its investors with enormous earning opportunities over the past few years. However, those who put all their savings into taking high risks have faced considerable losses.
Buying cryptocurrencies, Bitcoin, in particular, has gotten relatively easy over the past few years. There is no longer a major obstacle for Bitcoin as an investment.
ETFs, pension funds, and various financial institutions are giving up their profitable investments and making room for cryptocurrencies in their portfolios.
So, when is the best time to sell cryptocurrencies?
Many believe that selling an asset can be more difficult than buying it for investment purposes. Fear of missed opportunity (FOMO) can be effective. As the asset price rises, investors may think it will continue to rise for a little longer.
On the other hand, if the price suddenly drops, they may have made a mistake by not selling.
Many people think the crypto industry is not the “dot-com bubble” but will maintain its strong position. However, the high price volatility and speculation in the industry make any asset extremely risky and calculating the best time to buy or sell Bitcoin a bit complicated.
When to sell cryptocurrency?
Despite many analysts believing that the four-year Bitcoin block reward cycle broke last year, this process still seems to define meaningful bear and bull markets. The trend is never just up or down.
So knowing the best time to buy Bitcoin can help you plan when to sell.
The market fluctuates with Bitcoin movements. Bitcoin’s dominance in the market is over 40 percent. ETH accounts for 20 percent of the remaining amount. The remaining share represents the myriad of cryptocurrencies that could disappear in the next few months or years.
Obtaining a clear goal is probably the first step to take because it’s a small but the straightest strategy to keep you forward. Having a specific purpose, such as paying off debts, making a big move like buying real estate, or saving money for your kids’ education, is important to keep your investments running efficiently and give you the passion to continue within your plan.
Even if you’re thinking long-term investing in cryptocurrencies, you may want to consider selling all or part of your holding if you’ve reached double or triple the price you bought it. In this case, you can sell the equivalent of the initial investment or 5 to 10 percent of your total savings by calculating the best day to sell cryptocurrency.
Deviation from the target, little development, lack of innovation, or loss of faith in the project may also lead to selling assets. In this case, you should reduce your losses by selling at a reasonable rate and getting reliable data about the best time to sell cryptocurrency.
Are there any false calculations in determining the best day to sell the crypyocurrency?
Beware of the “Pump and Dump” Trap.
In the world of cryptocurrencies, new opportunities arise every day. We have to consider that some startups may be Pump and Dump (P&D) projects, which can decrease as much as 90 percent from the initial value; we must say that most new projects are risky, and there is a possibility of losing all the money.
However, investing in solid projects and keeping in mind the number one rule “only invest as much as you can afford to lose” prevents significant losses, so you can rely on the predictions made by the experts about the best time to sell the cryptocurrency.
It is also important to follow the overall cryptocurrency market and to understand the macro factors like war and epidemics that can affect the value of assets .
A drop in price in this type of situation will be significantly cause failure of the project. Keep this in mind to void panic selling that you might regret later.
Personal issues, market structure, and fundamental trading conditions can all play a role in your decision to sell your cryptocurrency.
However, if you choose solid projects, don’t risk your savings for the future, and have a little patience, you can reach a large amount of money in the long run. Sometimes the best investment strategy is to do nothing for a few years.