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Thursday, June 8, 2023

How To Play The Crypto Correction

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This story originally appeared on Zacks

The digital currency space is contracting after reaching nearly $3 trillion in total market value last week. It has officially entered correction territory (10% to 20% decline from recent highs). Nothing is surprising about a 10% pullback in this highly volatile market, but this current correction is the most significant digital currencies have seen since September and could mean that more pain is to come.

– Zacks

Cryptocurrencies have been the best performing asset class of 2021 by a mile as agile market participants prepare for the rapidly evolving future of finance. The total crypto market cap started the year under $800 billion. However, a tidal wave of fresh capital from individuals and deep-pocket money managers alike pushed this mystifying market’s value up 240% year-to-date (despite the recent tumble).

Traders are now pulling profits from their biggest winners, catalyzing a bearish domino effect that could easily pull this market down another 10% before a bottom is called. I have no doubt that investor & traders will buy this market right back up once the momentum shifts back towards the upside. My trades will be queuing off Fibonacci-extension levels (downside targets) in key coins like Ethereum ETH and Bitcoin BTC for my entry points (not implying that I will be buying either just using for technical reasons).

The coin that I am looking to buy on this crypto dip is Solana SOL, which is positioned to replace Ethereum as the most useful digital asset. Solana is functionally the same as Ethereum but supports transaction speeds over 1,000x as fast and fees that are 60,000x lower.

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