Blockchain and Cryptocurrency Beginner - Cryptocurrency Strategy - Holding or Trading?
Holding or Trading?
As far as cryptocurrency investing is concerned, is either you trade or you hold. For me, both have their benefits, pros and cons. However, I prefer Holding more because to be really effective and profitable in trading requires high-level trading skills and an understanding of technical analysis and the market, as they are key elements for successful trading.
Reason
The main reason why I prefer holding is because you can make more profit from the investment. It is only through Holding that it is possible to make 10x, 20x, 50x, 100x, even 1000x or more. Imagine people that bought BNB back when it was still under $10, same with coins like Dogecoin, BTC, ETH, and many other coins that have done over 100x.
Another reason I prefer holding is that it is very difficult to lose if you invest in a solid project with solid fundamentals. Yes, the price might dip very low, but if you don’t sell and continue holding, the coin would most likely bounce back and even make more profit. BNB is a clear example… people who bought BNB at its all-time high back in 2018 didn’t lose if they were still holding, BNB has done over 10x its all-time high since 2018. That is what holding and enduring can do.
The good thing is that Holding doesn’t really require the investor to be really good with technical analysis, however, the investor should be able to understand fundamental analysis and sentimental analysis so as to make good investments decisions. Some important factors to pay attention to before investing and holding any cryptocurrency...
Fundamental analysis
Fundamental analysis helps to have a clear understanding of the project before making the decision to invest. Important fundamentals like what the project is about, the project team, the marketcap, the circulating supply, the total and max supply, the community behind the project, the project whitepaper, etc. An investor needs to understand fundamental analysis because it is key for long term investments. Sometimes a project with strong fundamentals might have a dip in price due to various factors, however, holding can turn out to be much more profitable in the long term like we have seen so many times in the crypto space.
Sentimental analysis
Sentimental analysis helps to make better investment decisions based on what is happening around the project and what people are saying about the project. This is very important and shouldn’t be neglected because when done right can lead to a very profitable investment. Look at dogecoin, for instance, anyone who took advantage of the tweets of Elon Musk and the buzz around dogecoin a few months ago would have made a ton of profit by now.
That is how powerful sentiments can be in the crypto world. A project might not be too fantastic based on its fundamentals but can skyrocket in price in a matter of few months based on the sentiments around the coin or token. A clear example is some of the meme coins we see around on BSC.
