I wanted to know the general preference of people here. What are your views on Volatility and why ?
-Do You Consider Volatility to be an opportunity Where you can buy more coins and hold them for later
OR-Do you think that Volatility is unnecessary and should be leveled to match the market fiats so that Bitcoins can finally be stable and used as a currency.
Let me present my point of view.
(A healthy discussion is greatly appreciated)
-I do think that Volatility is an amazing opportunity to not only gain some Bitcoins but also perfect for interday trading, at the same time for people who did miss the opportunity to buy some at the right time, it gives you an opportunity to make that right. At the same time I do trust that we can always achieve ATH therefore it's also a matter of patience. It's not like you would loose when the value goes down. So if you have : Patience and you did miss your chance, I do think Volatility is a healthy thing for cryptocurrencies like Bitcoins. Then again we don't need to always compare Bitcoins with things like : traditional money 💸 , it's a whole different story.
What do you think ?
(Image credits to the respective owners, taken from Google)
Yeah, I like volatility, because given how important it is. Because with volatility we can find out how the action we have to take, we should buy and hold, or even sell, you can find out through the volatility that is happening at that time. In my opinion, here are some important things about volatility.
1. Volatility is referred to as "the state of the market"
Volatility is a change in price that shows market fluctuations in a certain period. Because with this we can see prices can jump up or even fall down, which means that there is high volatility. Meanwhile, when the market is calm, it means that there is low volatility where none of the sellers and buyers dominate the market.
2. Profit opportunity is directly proportional to risk opportunity
When there is high volatility, you will get a big profit opportunity because the price will move far from the previous closing price. However, this is directly proportional to your risk opportunities because no one can hold and predict market movements. This is when your stop loss comes into play.
3. Use of stop losses
"Cut your losses short and let your profits run"
I think this adage is applicable when the market is in high volatility conditions and profit opportunities are directly proportional to risk opportunities, so that you can anticipate uncontrollable losses you can place a stop loss position that is smaller than your target profit level.
4. Fundamentals affect volatility
Volatility increases when there is new news that is different from market expectations when data is released from one of the important activities in the economic market. Brokers usually provide an Economic Calendar to inform you of the data release schedule for important activities that can trigger increased volatility. Such as the United States Economic Data which can have a big influence as a determinant of market sentiment.
5. Volatility is a trader's main focus
Take advantage of high volatility when trading every day (overlap) where market liquidity is high or when important news is released such as US economic data. Meanwhile, low volatility will occur during national holidays such as Christmas, Thanksgiving, New Year, and others.