What is the Crypto Pump?
A cryptocurrency pump occurs when the price of a cryptocurrency rises
suddenly and dramatically.
This may be brought on by a variety of things, such as:
- Demand increases: The price of a cryptocurrency will rise when there is a greater desire to purchase it than to sell it. Numerous things, like good press for the project, new listings on exchanges, or collaborations with other projects, could be the source of this.
- Manipulation: Due to their relative lack of regulation, cryptocurrency markets are susceptible to manipulation. Pump-and-dump schemes, in which a group of individuals purchases a significant amount of a cryptocurrency and then heavily promotes it on social media and other platforms, are a popular type of manipulation. As a result, the value of the cryptocurrency rises, and investors profit from the sale of their holdings, leaving other investors holding bags of now-worthless cryptocurrency.
- FOMO: In the cryptocurrency market, fear of missing out (FOMO) is a strong motivation. Even if they are unfamiliar with the project, investors may be persuaded to purchase a cryptocurrency if they witness it surging in value. This has the potential to increase the cryptocurrency's price even more. It's crucial to remember that bitcoin dumps frequently occur during pump events, when investors liquidate their holdings. For investors that entered the market later, this could result in substantial losses.
Don't missing out.
Fairly evaluating cryptocurrencies with a smaller market capitalization will
allow you to observe the pumps from a comfortable vantage point and ride the
wave when it begins.
Start exploring the lowest sections of the CoinMarketCap dashboards to witness
some wild fluctuations in the market. At this point in the market, it may be
hard to discover these incredible gains, but double digit pumps are not
unusual.
These pointers should help you find these hidden treasures:
- Locate at least 8 coins that appear to have promise.
- Ideally, those you haven't previously heard of or investigated.
- You can evaluate their potential with objectivity if you don't know anything about them. Furthermore, it's preferable if influencers haven't written a lot about these coins. The coin's potential has not received as much attention.
- To begin, visit CoinMarketCap and search for coins starting on the second or third page.
Examine each coin individually, keeping an eye out for the following:
- Price history: Throughout its existence, the coin should have been rising in value and should not have experienced any odd peaks or dubious trade volume. You can observe these changes by putting your pointer on the chart. It would be preferable if these coins are more recent—that is, issued after the 2017 bull market. These coins will continue to rise because there won't be a definite price resistance.
- Differentiate between coins and tokens: is a cryptocurrency a part of another blockchain (token) or does it have its own blockchain (coin)? It should ideally be on one of the main blockchains, such as Ethereum, Cardano, or Solana, or have its own blockchain.
5 Actions, you can take if you want to become a professional cryptocurrency trader:
- Comprehend the fundamentals of trading cryptocurrencies.
- Use a demo account to practice trading.
- Increase your risk gradually by starting small.
- Apply risk-reduction strategies.
- Exercise discipline and patience.
With 3 years of experience, Hyper offers you free, profitable calls. Please be
aware that there is no certain strategy to prevent cryptocurrency pumps; these
are only basic recommendations. Even seasoned investors may experience
financial losses in the volatile and uncertain cryptocurrency market.
5 indications that a cryptocurrency could be primed for a Pump
These are five indicators that a cryptocurrency may be preparing for an
upward trend:
- More People are Trading: An increase in the number of people purchasing and trading cryptocurrencies indicates a rise in interest. Price increases may result from this, which is encouraging.
- Positive Announcement and Note: When notable individuals or businesses discuss cryptocurrencies favorably or when there's a lot of favorable news surrounding them, investors may become more assured. The price may increase as a result of this confidence.
- The RSI Indicator Indicates a Change: A shift in a cryptocurrency's RSI pattern could indicate a shift in the trend. This may indicate that the price will begin to rise even if it has been down.
- Lots of Talk on Social Media: If a cryptocurrency is receiving a lot of attention on websites like Reddit or Twitter, a price increase may be on the horizon. Positive online reviews may attract the attention of more investors.
- Clear Government Regulations: Potential investors may feel more at ease if their nation's government makes it apparent how they feel about cryptocurrencies and establishes regulations to encourage them. This may increase the desire for that specific cryptocurrency among users, which could raise its price.
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