BTC Price Falling By 20%, How Smart Traders Gain the ROI of Over 1000%

So far on June 10, the entire crypto market is once again in the red, with the crypto market cap falling to $1.1 trillion. The Fear and Greed index of the cryptos has now entered high fear area by marking ETH’s downfall of 12.71% and ADA is down 10.40% over the last 24 hours, while Bitcoin‘s price has plummeted to $20,250, down by 9.56%, most likely as a result of the previous trading day’s interest rate rise. Prices are expected to fall significantly in the coming month, eventually draining significant amounts. However, several factors suggest that now is the best time to buy the dip.

Reasons For Further Losses of Risky Assets

The Consumer Price Index increased by 8.6% year on year in May, compared to 8.3% in April, according to the Department of Labor. The market had predicted an 8.1% reading. In the United States, inflationary pressures have driven the Federal Reserve to hike interest rates more swiftly, signaling additional losses for risky assets.

Bitcoin’s price plummeted below $21,000, with the possibility of more declines，most likely as a result of the previous trading day’s interest rate hike.

Extreme Fear and Greed of Bitcoin

Market volatility has put the crypto market and retail investors on edge when it comes to predicting the future price of the flagship digital asset. The analyst criticizes its current price, which is 69.78% less than the previous year’s all-time high of $67,000.

Furthermore, the BTC’s recent decline has broken the market with a than $1.5 trillion loss, and there are still concerns on this digital asset of another crypto winter comparable to that of 2018.

With this, the fear and greed around bitcoin have reached an all-time high following the stunning fall of the crypto market.

The Greed Index Reflects That the Market Should be “Hot”

Warren Buffett once said, ‘Be greedy when you are fearful’. When analyzing the current sentiment of the Bitcoin market, 0-100 is often used to indicate fear and greed sentiment. Zero means “extreme fear,” while 100 means “extreme greed.” When investors become “too greedy”, it means that the market will adjust, and when the index points to “extreme fear”, it illustrates that investors are too worried, but it also indicates that it is a good opportunity to buy bitcoin. Smart investors can accurately identify market signals and seize every investment opportunity. This big drop may also bring comparable opportunities.

The Best Time to Bottom out Bitcoin

Since reaching the all-time high of $69,000 on November 10 last year, BTC has fallen to around $20,250, falling by 69.78%. In other words, if you bought a Bitcoin spot at $69,000, your assets have shrunk by 69.78%. Even if Bitcoin revives next, it will be difficult to make gains in the short term.

However, there are still some traders who earn more than 1000% return in such an extreme market. They are using one of the most popular investment methods at present: Futures Trading with 100x Leverage.

The traditional spot can only buy up and wait for the rise to make a profit. With 100 times leveraged futures trading, you can either buy up (go long) or sell down (go short), which means that you can take profits whether the market rises or falls. What’s more, you have 100 times leverage to magnify your profits.

How does 100x Leverage Works?

With 100x leverage applied, traders can use 1 BTC to open a position of 100 BTC by going long (predicting BTC price will be up) or going short (predicting BTC price will be down).  If we use 1 BTC to open a long contract at the price of $20,000 and close it when Bitcoin is trading at $22,500, our profit will be ($22,500 – $20,000) * 100 BTC / $22,500 = 11.11BTC, making the ROI of 1111%. 

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Disclaimer: The opinion expressed in this chart solely author’s. It does not interpreted as investment advice. TheNewsCrypto team encourages all to do their own research before investing.