Bearish Crypto Market Financial Terms You Should Know

  • Accumulation phase: This is a period of consolidation when prices trade within a narrow range, usually following a bear market or downward price trend and investors see an opportunity to buy or accumulate assets at a low cost. The importance of an accumulation is that it usually precedes the start of an upward price trend or a bull market.

  • Alt Coins: An altcoin is a cryptocurrency that was created as an alternative to bitcoin. Altcoins can be created to improve upon the original design of the Bitcoin network or to pursue an entirely different model.

  • Bag holder: A purse holder is someone who holds a coin that has lost value and is now worth less than what it paid for, or nothing at all. Bag holders usually buy at the top of a cryptocurrency’s value and end up holding only an empty bag.

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  • Kiss: A bear market is a market where prices are falling.

  • bullish: A bull market is a market where prices are rising.

  • bear market: A bear market is a prolonged period of falling asset prices. Bear markets are generally associated with a high degree of uncertainty and pessimism in the markets.

  • Bear Flag: This is a technical pattern on a map that looks like an inverted flag with a pole. After a period of bearish price action, this pattern signals a possible further decline in bearish prices.

  • Bubble: A hyper price increase fueled by speculation and hype for a particular market or asset. It is often associated with the overvaluation of all market assets and the expectation that the price may crash or the breakout will bubble.

  • bull market: A bull market is an extended period of asset price growth. Bull markets are usually associated with optimism and high market confidence.

  • Bullish Reversal: After a period of falling prices or a period of consolidation below the 50-day moving average or the 200-day moving average, this will be the start of a new uptrend.

  • Capitulation: This happens during a downtrend or bear market where the price of an asset falls and the asset experiences a massive increase in selling pressure.

  • Correction: A correction occurs when the market price of a crypto or digital asset falls 10% or more from its peak over a period of days, weeks, or months.

  • Encryption crash: A crash is a sudden and sharp drop in asset prices, usually by 10% or more in a single day. Crypto crashes are usually associated with high market uncertainty and fear.

  • Dead cat bounce: A dead cat bounce is a small, temporary uptick in the price after a major decline.

  • death cross: A technical pattern in the charts where the 50-day moving average crosses below the 200-day moving average, indicating a possible continuation of a downtrend.

  • Diamond needles: A popular slang term on Reddit and Twitter for those who hold volatile stocks or cryptos despite a high price rise or fall because they believe in the long-term value of the asset.

  • FOMO: FOMO is the acronym for “fear of missing out”. FOMO is the feeling of fear or excitement that comes from the thought that you might miss a good opportunity and the pressure to get it. This can lead to buying a digital asset at the maximum price before a massive drop.

  • FUD: Fear, uncertainty and doubt. FUD is often used to describe negative sentiment in the market.

  • gold cross: A technical pattern in the charts where the 50-day moving average crosses the 200-day moving average, indicating a possible continuation of an uptrend.

  • Liquidation: When a company decides to cease operations, it sells its assets to pay off lenders and creditors. Investors may also liquidate their holdings to raise funds, exit a weak position, or for other reasons.

  • Liquidity: The ease with which a cryptocurrency can be exchanged for another digital asset or fiat currency. Assets with good liquidity have a good number of buyers and buyers.

  • Margin Call: This occurs when the portfolio value of the owner’s account falls below the required threshold of the courtier’s required limit. This requires you to add more money to your account by depositing more or selling short-term assets.

  • Market capitalization: In crypto, market cap is the total value of all coins or tokens circulating in the market.

  • Moving Average: One of the most common technical indicators on a chart is a line that shows the average price change over a specific period of time such as daily, four hours a day, weekly, etc. It allows investors to see the general trend through price spikes and – flattening out declines. Common moving averages are the 50-day moving average and the 200-day moving average.

  • Oversold: This term is used to indicate that an asset’s price is too low or undervalued, as evidenced by a technical indicator such as the Relative Strength Index (RSI) or Stochastic, indicating a potential bullish reversal in price.

  • Pumping and Dumping: It is a form of market manipulation in which a group of investors artificially inflates the price of an asset by buying it in large quantities or publishing it via social media, or both, and then doing the “reverse” in the market for profit.

  • Upright wedge: This is a technical pattern found on a chart that indicates a possible low breakdown in price action. This is usually used in conjunction with technical indicators such as the RSI or the Money Flow Indicator (MFI) to measure the likelihood of a rapid price decline in terms of an overbought state or bearish divergence.

  • Risk on/risk off: Risk-on-risk theory states that when the market or economy is in good shape, investors are more likely to buy riskier investments, such as crypto or stocks. When the market or economy is bad, investors prefer safe-haven assets like bonds or sit on the sidelines with cash.

  • Clearance: As it sounds, it happens when people quickly sell a specific asset, causing the price to drop quickly at high volume. This can happen during a crash or because of bad economic news.

  • Short sale: Short selling is a form of trading where you sell an asset that you don’t own and hope to buy it back later at a lower price so that you can take advantage of the price difference.

  • Exchanger: A transaction is a transaction where you exchange one asset for another. The purpose of a trade is to profit from the price difference between the two assets.

  • V-shaped recovery: This is a technical chart pattern in which the prices of an asset or market fall dramatically and then recover very quickly, allowing for a V pattern on a chart.

  • volatility: Willingness is a measure of the fluctuation in the price of an asset. A volatile asset is an asset with large and sudden price swings.

  • Whale : A whale is an investor with a large capital. Whales can have a significant impact on the market price of an asset by buying or selling large quantities.

  • pull saw: When the market is neither bullish nor bearish, there are periods when the market or asset price is stuck in a range where the price rises and falls rapidly over an extended period of time.

  • Cause or the percentage return is the income generated from the principal of your investment. Let’s say you bought bitcoin for $10,000 and its current price is $19,000. The yield is 90%.

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