Topic: Don’t Fall Prey to these Market Sentiments and Save your Bitcoin - page 2. (Read 369 times)

Pump and dump scheme does not exist in Bitcoin market. If it has ever existed, it was long time ago, years ago when Bitcoin had smaller price and very smaller trading volume. Nowadays, you can see rises and falls for Bitcoin but not pumps and dumps.

It is true to use pump and dump scheme for altcoins, not Bitcoin.

DCA and hodl your bitcoins with very long term vision will help you get rid of fear of missing out, panic.

Stop loss order is good but you have a better order, Stop limit order

Well, avoiding HODL is what we should stay away from since it's a great strategy to HODL.
The purpose of HODL is to take advantage from Bitcoin's capped supply and long-term trend.
HODL means we don't sell because selling would mean a loss if we miss getting back in, when prices will go up again.


And regarding diversification: I'm not sure if diversification is beneficial at all. I've written a separate article about it: Is diversification into different coins really a good advice for Newbies?
Just HODLing Bitcoin has proven to be less risky than diversification into different Altcoins.


After all, it's an interesting compilation.
May I ask which are the sources where you got your content from? I might add some more Merit if I know about the genuity of your compilation and amount of your workload. 

Dear Op your complication for the his topic is great but i think you should move this topic to the trading discussion still as its BTC related as per your tittle and content so it falls between both Trading and Bitcoin Discussion.

I want requote your some points as far my observation FOMO and Fud these are the roots of Losing Assets. Whenever we see the market is getting massive green and we take urgent entry in other words Trying catch the running train we just lose everything. Similarly in small Red spots sudden exit from market destroy our portfolio.

The market is recovering after a long time of bearish trends and this has turned negative vibes into positive ones. I have observed some people with basic knowledge of crypto and blockchain talking about Bitcoin crossing $30k to $35k easily. I’m not saying that’s not going to happen, but I'm also not saying it must happen.
Therefore, before jumping blindly into the market, some knowledge of these market sentiments should be in mind. Because it’s not the first time that the market has been changing its trend trends, so background knowledge of every move of Bitcoin must be in mind to save your money.
Avoid These 4 Market Sentiments to Save your Bitcoin
Before jumping into a brief explanation. You should know the difference between market sentiments and personal sentiments. Market Sentiments explain the mood of the market collectively depending on many factors such as news cycles, Investor Sentiments and Market Trends etc. On the other hand, personal sentiments explain the individual’s attitude against any asset such as Bitcoin. For example, personal goals, biases and emotions etc.
We are going to discuss only market sentiments. These are the five market sentiments to which people belong to the beginner category and people belong to the Pro category. All of them fall prey. So here you will see what those sentiments are and how to avoid them to save your bitcoin or any other coin.
1. FOMO (Fear of Missing Out):
“Fear of missing out on any asset which you think you will never be able to get that chance of buying or selling that specific asset again and you take action according to the heat and pressure in the market”.
how to avoid FOMO sentiment:
We will try to learn the technique of avoiding FOMO with the help of an example.
Bull Run of BTC 2017:
In January 2017, the price of one BTC was $1000 and when the bull run started, the value of BTC began to increase in a short period of time. As can be seen in the picture below.
FOMO was created at that time not only among investors but also among traders too. All of them tried to fill their pockets with BTC so that they can save more profits in future. But after the end of the year that bubble collapsed and profits turned into losses. A sense of bullishness created among traders and market tries to manipulate their sentiments and they fall prey to it easily.
This becomes an example for all of us in the bull run of 2021 and most of us saved there profits before the collapsing of that bubble.

2. HODLing (Holding On for Dear Life):
HODL is the misspelled form of HOLD. This term was first used on Bitcointalk forum, here. The meaning of HODL and HOLD are the same. Which is to hold some assets for a long time regardless of any market conditions, there will be no change in that holding. Holders and investors are two different things and HODL is a word mostly used by holders.
Why should we avoid hodl?
Sometimes, the market is showing the indicators that now is the time to book your profits or to exit from the market but you as traders or holders, do not look at those indicators in the stubbornness of FOMO and have to bear consequences.
How can we avoid HODL?
These are the few steps that you can take to avoid HODL that can cause loss of BTC.

• Set stop-losses and take-profit targets
• DCA (Dollar Cost Averaging)
• Have a well-thought-out investment strategy
• Regularly review and adjust your portfolio
• Conduct research and due diligence
• Have a plan and stick to it

3. FUD (Fear, Uncertainty, and Doubt):
FUD stands for Fear, Uncertainty and Doubt. These terms explain the definition of FUD. Which is spreading false news and rumors about any token or BTC to degrade the prices of that particular token. Which in return creates fear, uncertainty and doubt among investors, traders and holders.
Examples of FUD in Bitcoin:

• The FUD of Bitcoin exchange in 2011, in which the CEO of Mt. Gox, said that around 850,000 btc has been hacked from the exchange due to some loopholes in our system which causes major drops in the prices of BTC. But, they never were hacked, the full story can be read here.
• Chinese FUD in 2013, in which they declared the banning of crypto withdrawals and deposits through banks. But later, they clarified that we are not going to ban banks dealing with crypto. We are just trying to handle money laundering cases. China has a long history of creating FUDs by banning crypto.
• Jamie Dimon’s statements about BTC as “Fraud” in 2017, caused a great dump in the market. He was the CEO of JP Morgan. After making that statement he also confessed that he made a mistake by calling BTC as “Fraud” and “it will blow up”.
• India announced a ban on cryptocurrency in 2018 which caused a great price drop of BTC. This was all a FUD by India because later they clarified that they do not want to ban crypto trading, instead they want to regulate it by some legal means.
• Rejection of BTC ETF Proposal by SEC in 2019 also a FUD which causes the BTC value to decrease. Later they also clarified that, we are not rejecting the BTC ETF proposal but instead we were not satisfied with some terms in the proposal that need improvement.

These examples must have given you the idea of how fuds are created and clarified later.
How can we prevent from FUDs on Bitcoin:
These are some rules to follow if you want to prevent from fuds.

• Reading reputable news sources and publications that cover the crypto market
• Following reputable experts and influencers in the crypto space on social media
• Joining online communities and forums where you can discuss and learn about crypto
• Staying up to date on regulatory developments and announcements that may affect the market
• Not making any hasty investment decisions based on hype or FUD.

To prevent falling prey to FUDs you need to know the market sentiments. Like you need to understand whether there is a fud or not. Then you can prevent from fud. To do so, you need to know these rules of how to detect a fud.

• Check the source: Before acting according to any news you watch, check the source of that news and compare it with other sources.
• Look for signs of manipulation: Sometimes, FUD are created by running some social media or crypto trading campaigns. All you have to find is suspicious activities which activate any red flags according to your senses.  
• Analyze the Evidence: Before acting upon any news, must check all the evidence then act accordingly.

4. Pump and Dump Schemes:
It’s an artificial sentiment in the market created by a group of people or by individuals by running different social media campaigns to create hype of specific token among investors so that they can increase the pressure on selling or buying. To understand this concept you need to know the difference between “overvalued and under-value” of any assets.
Over-value: means the price of some assets is higher than the actual value of that asset.
Under-value: It’s the opposite of over-value of some assets. In this the value of some assets decreases below the actual price.
Why should we avoid Pump and Dump Schemes?
People involved in these schemes try to manipulate the price of the token according to their need. For example if they want to over-value any asset, they create hype for that token to increase the buying pressure.
And if they want to decrease the price of any asset, they under-value it by spreading false news among investors to urge them to increase pressure on selling that specific token.
In this phenomenon, real investors who aren't involved in this scam, lose a lot of money and fall prey to these sentiments manipulated by market makers. But, if P&D schemes have no impact on btc value then when we need to avoid it. it do effect btc price indirectly, How? When P&D schemes are running in the market with shit coin to manipulate the market, This phenomenon causes regulatory scrutiny and in result strict regulation are applied on the whole crypto industry which indirectly effect the price of btc so you should be aware of them too.
These regulatory scrutiny could be very vague or could be ignorable depends upon the effect of P&D schemes on innovating ideas directly or indirectly related to bitcoin. To understand this concept you have to broad you point of view and think in terms of direct or indirect impact on btc by means of regulatory bans due to improper use of cryptocurrency to hurt innovative ideas of investors and organizations.
why pump and dump schemes cannot be applied to bitcoin:
Mainly, execution of these schemes on bitcoin is highly difficult because firstly, it's a decentralized asset, secondly, it has finite supply, so if someone tries to apply a P/D scheme on btc, can easily be spotted.
There are more than 500 exchanges from where users can collect data related to btc and prevent themselves from these schemes. Well if no pumps and dumps scheme can be applied to BTC then why we need to avoid it. Because it can be applied to upcoming shitcoin. That's another field of topic so we must leave it here.
How can we avoid the Pump and Dump Scheme?
Without going into a brief explanation, I will write only some points to follow to avoid the pump and dump scheme.

• Do your own research
• Avoid hype
• Be skeptical of guaranteed returns
• Be aware of red flags
• Diversify your portfolio
• Use regulated exchange

Conclusion:
Overall, these 4 market sentiments are no new things to an existing trader but they do a new thing to new traders or users of crypto. So by having the knowledge of these 4 sentiments related to the market will help your personal thinking strategies. FOMO, FUD, HODL and P/D, are not only the sentiments of the market. There are more on the list but these 4 are important to know about.
Note* I collected the above data from various articles and tried to write them in an understandable manner under the roof of one article. If this post is irrelevant or contains any mis-information then please it would be my pleasure to know about that. Because it’s my first thread on Bitcointalk.