What does the currency circle mean by being stuck? A popular explanation of being stuck in the currency circle

Hold-up refers to the state of loss caused by investors purchasing cryptocurrencies at a price higher than the current market price during a bull market bubble burst or a sharp market decline. Hold-up mainly occurs when buying highs and not chasing highs, which may lead to financial losses, emotional fluctuations and wrong trading decisions. In order to avoid getting stuck, it is recommended to adopt strategies, including: setting up stop-loss orders, buying on dips, buying in batches, avoiding chasing prices and being prepared for long-term holdings.

Hold-up in the currency circle

In the cryptocurrency market, "hold-up" refers to a situation where investors purchase assets at a price higher than the current market price, resulting in a loss. Hold-ups often occur during bull market bubble bursts or significant market declines.

How to get stuck?

Hold-up occurs in the following two main situations:

• Buying highs: Buying cryptocurrencies when the market price is at a stage or overall high.
• Don’t chase the highs: When the price starts to fall, refuse to admit the loss, hoping that the price will rebound and make a profit.

Consequences of Hold-up

Hold-up may have the following consequences for investors:

• Financial losses: Continuous decline in prices will cause investors to suffer greater losses.
• Mood swings: Being stuck can cause negative emotions such as anxiety, stress and fear.
• Errors in trading decisions: Hold-up will prevent investors from making rational trading decisions, because they may make impulsive buying and selling out of a desire to recoup their capital.

How to avoid getting stuck

In order to avoid getting stuck, investors can adopt the following strategies:

• Set a stop-loss order: Set a specified price point when buying an asset, and if the price falls below that point, The asset is automatically sold to limit losses.
• Buy on dips: Buy assets during market downturns to reduce the risk of getting stuck.
• Buy in batches: Don’t invest a large amount of money at once, but buy in stages to reduce risks and increase your chances of profit.
• Avoid Chasing the Price: Be cautious when the market is at bull market highs and do not chase rapidly rising assets.
• Be prepared to hold for the long term: Be patient when investing in cryptocurrencies, don’t expect to get rich overnight, be prepared to hold for the long term and survive market fluctuations.

The above is the detailed content of What does the currency circle mean by being stuck? A popular explanation of being stuck in the currency circle. For more information, please follow other related articles on the PHP Chinese website!