Of course I invest based on price, market trends and based on the amount of capital I use. If my capital is a lot I will buy ethereum or BNB for the long term and BNB for the medium term. And coins whose prices are still not high but potentially good in the future. As for the short term I only buy a few altcoins which I then sell at a certain price and I buy them back.
Definitely number two. Don't get me wrong I do not have much NFT, but if I am going to invest into any NFT ever, then it must be useful for one way or another. Look at Axie for example, it has a huge use and you could make a lot of money with it, that's still considered NFT as well but gaming, it is not a picture, it is not a jpeg that was put into NFT, it is not some tweet, it is not a painting put into NFT format, it is literally just a game and you can make so much money from it.
I wouldn't own Picasso's paintings as NFT but I would spend more on some silly Axie just because I can make an income with one while the other is useless until I make some profit from it by selling, and after I sell it then there is no way to make an income from it neither. For something to be worthy of my investment, I need to make sure that I could make an income with it.