$BTC $ETH There are several reasons why people tend to buy financial assets, such as cryptocurrencies, near the top of the price:
👀1. FOMO (Fear of Missing Out): When an asset is experiencing a rapid increase in price, people may feel FOMO and fear missing the opportunity to profit from that increase. This can lead to impulsive buying even when the price is at a high level.
🤑2. Expectation of quick gains: Many people buy financial assets in the hope of making money quickly. When an asset is trending, the expectation that the price will continue to rise can lead people to buy, even if the price is already high relative to fundamentals.
📉3. Loss aversion: People may hesitate to sell an asset when they are in a losing position, in the hope that the price will recover and they can recover their losses. This can lead to additional purchasing even when the price is already high.
📊4. Inexperience or lack of understanding: Many new or inexperienced investors may not fully understand the fundamentals of an asset or how to assess its value. This can lead to purchasing decisions based solely on the current price trend without considering other important factors.
💣5. Media and social influence: Media coverage and the influence of celebrities or influencers on social media can lead people to purchase financial assets without carrying out adequate analysis. This can result in buying near the top of the price, especially when the asset is receiving a lot of positive attention.
In short, people often buy near the top of the price due to a combination of emotions, unrealistic expectations and external influences, rather than making a rational analysis of the asset's fundamentals.
