The article outlines five strategic actions for crypto traders during quieter market conditions when Bitcoin’s performance is declining. Key recommendations include researching undervalued projects, earning through staking and lending, monitoring on-chain data, diversifying investments, and enhancing trading skills.
April has been challenging for the crypto market, especially Bitcoin, which experienced a significant decline attributed to U.S. tariff policies and inflation concerns. Following a peak above $100,000, Bitcoin’s price dipped to $74,000 earlier this month. The trading volume for Bitcoin has also hit multi-month lows, prompting investors to offload their riskier assets.
In these turbulent times, seasoned traders can take advantage of the market’s quiet phase. Experienced crypto traders know this period as an opportunity to leverage established strategies, while novice traders can refine their skills in this volatile landscape. Below are five recommended actions for crypto traders during quieter market conditions.
1. Research High-Potential Projects
As Bitcoin approaches a potential correction, investors are on the lookout for undervalued assets, particularly altcoins and DeFi projects. Solana, known for its speed and cost-effectiveness, is gaining popularity as a viable alternative to Ethereum, reminiscent of Bitcoin’s rise in 2013. Resources like CoinMarketCap and Messari are useful for pinpointing undervalued tokens with solid fundamentals.
2. Earn Passive Income Through Staking & Lending
Idled crypto assets can yield significant returns through staking and DeFi lending. Platforms like Aave facilitate decentralised lending and borrowing. Major exchanges such as Coinbase and Kraken offer staking opportunities with annual yields between 4–8%, enabling investors to earn while they wait for broader market growth.
3. Monitor On-Chain Signals
Astute investors track on-chain data to identify potential market movements ahead of the broader public. Analytics platforms like Glassnode provide insights on crucial metrics such as exchange inflows and wallet activity. Staying informed through real-time data from resources like Arkham or CryptoQuant can give traders an edge over retail investors.
4. Diversify Beyond Crypto
To mitigate the inherent volatility in crypto, professional investors often diversify across various asset classes. This approach is often employed by hedge funds allocating portions of their capital to stocks and bonds. Retail investors can replicate this strategy through tech ETFs or blue-chip stocks via platforms like Robinhood, which also offer crypto access.
5. Improve Analysis & Trading Skills
Developing strong analytical and fundamental skills is pivotal for crypto investors aiming to optimise profits. A well-researched investment approach is more effective than random selections. Utilizing historical blockchain data can assist in identifying trends. Additionally, platforms like TradingView allow traders to enhance their skills in demo markets, preparing them for future trading in volatile conditions.
Conclusion: What’s Next for Crypto?
Market analysts are divided on Bitcoin’s future trajectory. While some predict a rise to $200,000 fuelled by ETF demand and institutional interest, others foresee potential declines. Furthermore, rising Treasury yields may attract investors away from Bitcoin. However, optimism remains with the upcoming 2024 halving and conducive policies from the Trump administration fostering a generally positive outlook. In this quiet phase, advanced traders are strategically positioning themselves for the next bull run.
