As soon as the price of cryptocurrency once again peaks, almost every person invested in digital assets wonders whether to sell bitcoin right now. And this is no exaggeration. Anyone who has bought cryptocurrencies before is familiar with similar thoughts:
‘What if the price collapses soon?’
‘What if I don't sell, and wait for further growth?’;
‘What price will bitcoin eventually reach?’.
Therefore, the question of when to fix profit is not simple for both beginners and experienced participants in the crypto market.
Let's consider the terminology in more detail. Profit taking is what professional and not so professional market participants call a transaction to sell an asset that increased in value. For example, coins were bought at the rate of 10 thousand dollars. Their further selling at the rate of 50 thousand dollars is called profit taking.
In this article, we will examine whether to sell bitcoins now, whether to wait for new price values, and how it is better to fix profits.
Market participants have already become convinced that cryptocurrencies are a very volatile asset. Volatility refers to price fluctuations. The more the value of an asset changes during, for example, a month, the more volatile it is.
Therefore, after buying digital coins, doubts may arise. Anyone can open a bitcoin chart and realize that its price has fallen hard more than once. However, the same chart shows that later on, the value not only returns to the previous peak value, but also surpasses it.
Understanding these facts is very important. After all, you will be much less worried about the next price collapse if you know that there is a chance to sell bitcoins for much more.
Experts agree that the first cryptocurrency will always rise at a distance, because it:
- is limited in emission - the number of coins is of course, and over time will begin to decrease rather than increase;
- is becoming very popular, and more and more people want to buy at least a little bit of bitcoin;
- gave the world a technology that is developing by leaps and bounds - cryptocurrencies and their blockchains (the networks on which they function) are increasingly being used to solve business problems.
For example, the head of the largest American bank JPMorgan, Jamie Dimon, believes that in the next 5 years the price of bitcoin could grow 10 times. There are more optimistic predictions - some experts expect that the price of bitcoin will reach $200,000 per coin in the next few months - in November and December 2021, or until March 2022.
However, no one knows exactly when and how much the cryptocurrency rate will grow. We can only speculate and observe, and of course, buy bitcoin with the aim of getting income after selling it in the future. At the end of this article, we will consider a way to easily invest in cryptocurrency, even for a beginner using the Broex exchanger. But first things first.
The answer to the question whether you should sell bitcoin now depends on when you bought it and what your goals are:
- Long-term investments. People who are willing to hold their cryptocurrency for 3 to 10 years spend almost no time on it. You just have to buy bitcoins once (or buy them in installments every month) and then just wait. You don't even have to constantly monitor the exchange rate. What difference does it make what the price is today, if the sale is scheduled for 2025-2030, and the cost will almost certainly increase dramatically?
- Trading. This is what they call the process of making numerous transactions to buy and sell assets. Traders trade all the time. They often manage to buy and sell the same asset several times during the same day. The goal of trading is to make money on the price differences. However, to achieve it, one needs either a lot of experience or a skillful instructor.
Only long-term investments are recommended for beginners because they do not require any skills and knowledge, but at the same time they bring a large and stable income.
Let's look at examples:
- Suppose a bitcoin is bought at a rate of 30 thousand dollars per coin in July 2021. If you sell it at a rate higher than 60 thousand dollars, the investment will be doubled. Even if the price continues to grow, you have already earned, and you will not worry too much.
- Bitcoin is bought in the middle of April 2021, at a rate of about $63 thousand. Then, due to the update of the peak value, many newcomers became interested in the cryptocurrency. And then, the very next month, the price dipped below $35,000. In this case, by selling the coins at the buying rate, you will only get your investment back. If at the time of reading this article, the rate is still treading around 63 thousand dollars, you may have two options:
- Sell the assets, ‘go to zero’, and hope that the rate will collapse in the future, and you can buy the cryptocurrency back at a lower price (but also be prepared for the fact that this may not happen);
- Wait for further growth so that you can not only get your investment back, but also generate income.
- Or maybe you were able to buy bitcoins in 2020 at a rate below $10,000. Then you can sell now with a profit. But in such a situation, a partial profit taking may be the best choice. That way you can return the investment at a profit, but leave some currency, for example 50%, in order to sell in the future at a higher price.
These examples show that the profit taking strategy depends on your goals. If you're willing to wait 3-10 years for a big profit, you can sell nothing, and continue buying the dips.
If you are not ready to wait for a long time, and now the rate is higher than when you bought it, you should bravely sell bitcoins in order not to kick yourself in case of the next price collapse.
Those new to the cryptocurrency market who are pondering whether to sell bitcoin now often miss one interesting strategy. According to many experienced asset traders, the best profit-taking option is to sell in installments.
Let's look at an example. Let's say BTC were bought at a rate of $30,000, and then the rate rose to $60,000. In this case, you can sell part of the coins, for example 25%. After that:
- If the rate goes up to $90 thousand, for example, sell another 25% of the coins. And then also, at 25% of the assets, sell after even greater growth.
- If the rate falls, wait until it rises again. In this case, part of the profit has already been fixed, and there simply won't be any worries about losing everything.
The point is that it is impossible to guess when the price will turn around and start to fall instead of rising. By selling in parts, you will definitely not miss out on growth.
The same goes for buying cryptocurrencies. It is better to buy not with all funds at once, but in portions. For example, invest 10-20% of your deposit amount every month. Then you will definitely not buy at peak values, and will not get into a situation where you have to wait a couple of years until the moment when your investments start to turn positive.
Whether to sell bitcoin now is up to you. But since most people should consider long-term investments in cryptocurrencies (especially beginners who are not yet ready to trade), there is no need to hurry to get rid of the assets. On the contrary, it may be worth considering purchasing additional coins to increase the size of your investments.
If you are planning to buy bitcoins, or want to sell your digital assets and make a profit, you should choose an exchanger by the following parameters:
- ease of use;
- reliability of cryptocurrency storage;
- commission rate.
Broex exchanger meets these requirements. The website is designed in such a way that even a user who has never worked with cryptocurrencies could easily get used to it.
Advantages of Broex:
- Official license. The company is registered in Estonia, so it works absolutely legally, which speaks of its reliability.
- Instant deposit of funds. You can deposit money for purchase in many ways, among which payment from a bank card is available.
- Russian-speaking technical support working 24/7. If necessary, you can receive prompt consultation on the question of interest.
- Low commissions. They make 0,1 % from the sum of purchase or sale, and in some cases are absent at all.
- Website + mobile app. You can access Broex from any device at any time.
You don't have to worry about the safety of storing cryptocurrencies you bought through Broex. The website also provides a custodial wallet. This means that the company itself is responsible for the safety of digital assets. Therefore, Broex is the best choice for people who are just starting to invest in cryptocurrencies.