We all know what it feels like to have that feeling of fear when seeing the color red on our screen, especially when we are beginners, and even more so when we start to see news and videos where everything is presented as if the world were about to end. But before panic takes over you, let's go over 3 points that will help you change your perspective on the markets a bit. Will you still see the color red? Obviously, but thanks to these points, it will help you to make it more difficult for panic to take control of you.
1- What really causes the market to fall? 👎
Geopolitical uncertainty: In times when military conflicts occur (such as in the case of the conflict between the USA, Israel, and Iran in 2026), causing aggressive disruptions in the global economy, it makes large investors panic and, to secure their capital, they shift from modern investments or high-risk ones to safer investments, such as gold, treasury bonds...
We must keep in mind that a military conflict is not just about weapons, but also involves economic sanctions against other countries, cyberattacks...
Cleaning of leveraged positions: When the market decides to fall, it is when many traders with long positions activate their "stop losses", and when activated, it causes them to be forced sellers, and that pushes the price down even more.
Exhausted narratives: This point is no longer for the market in general, but is more dedicated to pure manipulation. Many times, buy orders are executed because there are campaigns saying "This token is going to skyrocket, buy it, it's the future," and suddenly, you realize that the asset has gone from its all-time high (or near) and suddenly suffers an unpredictable bearish trend. This is due to fashion or simply that the hype has ended.
Negative news/security breaches in the crypto sector: All laws affecting the crypto ecosystem, cyberattacks... Cause a temporary distrust in the sector, therefore, it causes a temporary bearish trend.
2- "The green lights" that we must watch. 👀
In this world, not everything is red, there is also green. With a simple news item, the market can change from a bearish trend to a bullish trend, but let's be serious, it can also cut that trend.
Geopolitical De-escalation: Any sign of truce or favorable international agreement will automatically cause capital to be progressively reinjected.
Macro Data: Everything related to inflation (down), interest rates (down)... When everything announced is positive, it helps the market react favorably.
3- My management advice in these market situations: Smart rotation. 💻
One of the most important keys in case of doubt or if you have failed in a trade is that you must learn to accept losses and move that money into safe assets.
If you trust a project and see that the development is good, but notice that the market in general is entering a bearish trend, do not panic, remember these points that will help you from now on.
Why? Because the market is a transfer of wealth from the impatient to the patient. Analyze, do not gamble.
If you have made it this far, I invite you to check out my profile and take a look at my content. I have been inactive for a while, but I am back. Let's regain focus together.
I invite you to participate and share your opinion! 👇
#MarketDownturn #Write2Earn #LearnFromMistakes