Cryptocurrency markets are facing a wave of anxiety and anticipation, as talk of a major drop that may hit the market in the coming months increases. Several factors are expected to influence this sharp decline in prices, and this drop may be the beginning of a new phase of volatility and major challenges for cryptocurrency investors. If you are thinking of entering or are still maintaining your current investments, you need to be ready.

1. Global economic factors:

The global economy is facing a number of challenges, from rising inflation to rising interest rates. These factors directly impact liquidity in financial markets, which negatively impacts cryptocurrency investments. In addition, the ongoing pressure from governments to regulate these assets is creating new barriers to market growth.

2. Expected market correction:

After a series of huge gains in cryptocurrencies in recent years, there are expectations of a strong correction in prices. Some currencies such as Bitcoin and Ethereum are experiencing increasing pressure on both demand and supply. These currencies are expected to see a significant decline in their value before recovering again.

3. Technical effects:

Blockchain technology continues to evolve, but there are technical challenges facing some networks like Solana and Cardano, which can lead to price fluctuations. Late software updates or unstable modifications can contribute to pressure on the price of the coin.

4. Alternative currencies are at risk:

For altcoins like Polkadot, Chainlink, and Algorand, many of them are still building and strengthening their technological foundations, making them more vulnerable to volatility. With the expected market downturn, these coins may come under more pressure than the leading ones.

5. Technical Analysis and Markets:

Through technical analysis, there are some indicators that indicate that the market is very overbought, which may lead to heavy selling. There may be strong price fluctuations in the short term, which can lead to sharp declines in market value.

How do you prepare for this landing?

Portfolio Reassessment: It is important to evaluate your investments and review the assets you hold. You may need to reduce some positions in currencies that are more affected by the decline, such as altcoins with limited liquidity.

Caution in Leveraged Trading: Trading with leverage may increase the risks during such periods. Make sure to have risk management strategies in place.

Monitor news and economic data: If you are a day trader, you should always be aware of what is happening in the global economy and legislative developments that may affect cryptocurrencies.

Diversification in investments: Diversification across different assets such as gold, stocks, and real estate can be a way to mitigate the risks associated with a downturn in the cryptocurrency market.

Conclusion:

The expected decline in the cryptocurrency market is not the end of the road, but an opportunity to rearrange the cards. You need to be prepared for the next stage and think carefully about your options. While some may suffer from this decline, others may come out with big profits through the right analysis and good preparation.

Will you be able to survive this storm?