What are market cycles?
The crypto market moves in relatively predictable cycles, historically linked to the halving of Bitcoin (which occurs every 4 years). Each cycle has distinct phases: accumulation, high (bull market), distribution and low (bear market).
The Four Phases of the Cycle
The accumulation :The market is depressed, few believe in recovery. Smart money buys quietly.
The Bull Market:Prices start to rise, the media news, new investors enter Bitcoin usually leads, followed by altcoins (altseason).
The distribution :The market reaches historic highs, total euphoria.Experienced investors start selling to the beginners who have just entered.
The Bear Market:Prices drop 70-90%, weak projects die, fear prevails.
How to position yourself at each stage
In accumulation: buy BTC and ETH slowly (DCA). in bull: diversify to altcoins with foundations. in distribution: make profits progressively. in bear: return to BTC and stablecoins, and wait.
Phase indicators of the cycle
Bitcoin Dominance, Fear & Greed Index, MVRV Z-Score, NUPL and Google search volume are some indicators that help identify which phase of the cycle we are in.