Crypto Market volatility

There is a rumor that the crypto market is always volatile. What do you think? I think it is not as volatile as the people are treating or expecting. Sometimes it is experienced by many with the price fluctuation of some of the tokens or currencies but the total market is not volatile as people think so at least because there is a trend of prices going up or down with the price change of the market leader like Bitcoin. Market volatility is not only crucial for the traders but also it is important for the investors to gain some reward from this fluctuation of the price. So let's talk about some factors affecting the market volatility of crypto markets.

source

The main factor obviously should be the supply and demand of the currency or token. Demand and supply are obviously interrelated. With the change of demand in terms of supply the price always changes. Excessive demand for any currency with a similar kind of supply can increase the price and low demand with this supply can reduce the prices as well. The regulatory problem is another factor in the case of market volatility.

Although crypto is adopted by many companies, users, and sometimes countries, still there is no strong regulation for it accepted by many countries. So such a kind of regulatory problem creates volatility in the market price. Being a new technology and a new concept of currency and token its market capitalization is also low. For this kind of market capitalization, its volatility will be high because we know with a huge volume of the market the volatility is not possible. But for small market capitalization, it is possible to volatile the price with a small amount of investment by some of the investors.

While volatility can be challenging for investors it can also present opportunities for traders to profit from price movements. One common strategy used by traders is to buy low and sell high focusing on price swings.

~ Regards,
VEIGO (Community Mod)

|| Join the Discord Server for more Details ||