Buying cryptocurrencies after they have risen significantly in a short time is a common mistake among traders, especially beginners. Here are the main reasons why this is not recommended:
1. The risk of buying at the peak (FOMO)
When a currency rises suddenly and significantly, many people enter out of fear of missing out (FOMO).
But often, the price may have temporarily peaked and starts to decline after the latecomers enter.
2. Market correction
After any sharp rise, a price correction usually occurs, where the currency drops to stabilize at a more logical price.
This means you might buy at a high price and then lose immediately after the correction.
3. The possibility of market manipulation (Pump & Dump)
Some small currencies may artificially inflate their prices through promotional campaigns or speculative groups.
Those who enter after the rise are usually the victims when the big players sell and the price suddenly drops.
4. Technical analysis loses credibility
When a currency rises quickly, technical indicators (like RSI and MACD) enter the "overbought" area, indicating that there is selling pressure.
5. Whale behavior
"Whales" or big investors take advantage of public enthusiasm to sell their holdings when demand is at its peak, causing a sudden drop in price.
🔍 When is buying better?
After a clear price correction and price stability.
At strong support areas.
When technical indicators show that the currency is in an oversold area.
When there are strong news or projects supporting future growth.
