Tether was reportedly hacked on Nov. 20th. This caused a quick sell-off of all things crypto. However, most coins quickly recovered.
The lesson to learn here is this:
When panic sets in, make sure you understand what is causing the panic before you buy or sell.
- If the news was related to a given crypto it might make sense to sell that crypto and wait.
- If it was low volume after a bull-run, the answer might be to buy the dip.
- Meanwhile, if the news was unrelated to the coins you are holding, it could mean that you have only a short window to buy while others panic.
In this case, since the news had to do with Tether, and since Tether has very little to do with other cryptos, it didn’t make a ton of sense to sell Bitcoin or any other cryptos here.
Instead, as we can now confirm in retrospect, this was the sort of quick panic in which you wanted to “buy the dip” and hold.
Those who bought the dip last night were rewarded. Those who panicked barely had time to buy again before the market recovered.
No one can predict the future, but understanding the catalyst behind a sell-off or bull-run can give you a big edge.
Of course, we can’t tell you what investments to make, and each time you’ll need to do your own research and make your own choices. However, if you remember to check the news (popular blogs, Twitter, Reddit, other social media, etc) when a sell-off or bull-run starts, you’ll have that vital bit of information to help you know whether its a time to sell, hold, or buy.
Flying blind is never the best move, and charts only do so much when events are news related. So, always remember to check the news before reacting!
That is all.
TIP: For more reading, see: Tether Claims $30 Million in US Dollar Token Stolen from CoinDesk (speaking of places to check for crypto news).