Hello everyone! After a bullish period, many in the crypto space are wondering if we are close to a correction. It is a normal part of any market cycle, and being prepared can make a difference. And Bitcoin corrections have become very common these days. Today I want to talk to you about some key signals that I am paying attention to and how we can manage the risk.

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Signals to Consider:

Extreme Greed’ Fear and Greed Indicator:

When this indicator remains at very high levels for a period of time, it can indicate that the market is overheated and profit-taking is imminent. Excessive euphoria often precedes a decline. This is when many people are investing in greed.

Bitcoin-Altcoin Decoupling:

While Bitcoin’s dominance may decrease during an altcoin season, if many altcoins start to grow parabolically without clear fundamentals, or if Bitcoin stagnates or corrects while it is in a bubble, it could be a sign of a bubble in a particular segment.

Large capital inflows into stablecoins:

Large capital inflows into stablecoins like USDT or USDC may indicate that investors are pulling capital out of volatile assets, preparing for a correction, or waiting for a better entry point.

High and persistent funding rates:

In futures markets, consistently high funding rates (especially on long positions) suggest that too many people are betting on the upside, creating the risk of cascading liquidations if prices fall.

How to prepare for a potential correction?

Partial profit taking:

If your investments are performing well, consider selling a portion to lock in the profit. You can convert them to stablecoins or even fiat.

Portfolio rebalancing:

Adjust the percentage of your investments. If one coin increases significantly, you can invest in others with more potential or reduce its weight in less volatile assets.

Have liquidity ready:

Holding stablecoins allows you to take advantage of dips to buy assets at lower prices (DCA or 'buy the dip').

Research new projects:

Use consolidation time to research new projects with solid fundamentals that you can acquire at a good price if a correction occurs.