Frankly, one major challenge bitcoin enthusiasts have is that they don’t know the best time to buy bitcoin in Nigeria.
Everybody wants to play safe, nobody wants to buy bitcoin one minute and then find out it has dipped the next minute.
If you have ever been on bitcoin forums, you would have seen messages of people who have had personal experiences of buying bitcoin during the bear market.
People usually succumb to FOMO which clouds their judgments to make the right decision about when to buy bitcoin.
Such is the story of a trader who bought bitcoin when the price was at $38,000 because he felt it was going to rise and to his surprise, it did but fell back to $32,000.
He ended up losing some of his money.
Another trader was reluctant to buy because he predicted the price of bitcoin is going to drop to around $19,000 or $20,000.
He has been waiting since December 2020.
These issues and similar ones keep coming up, year in year out, with people not being sure of the perfect time to buy bitcoin.
In this article, we will try as much as possible to answer the question of when you should buy BTC and also briefly look into what is called the ‘bull and bear’ period and its implications.
You can also check out 8 ways to make money online passively with cryptocurrency.
What are the Bull and Bear Periods?
There are two seasons in the crypto market: The Bull and Bear Seasons.
The adoption of the two terminologies ’bull and bear’ is obtained from the bear and the bull animals and how they strike their assailants.
A bull pushes its horns up into the air while a bear swipes its pawn downward.
The Bull Period is the time of high optimism and expectancy when the price of bitcoin begins to rise.
It can be used to describe a period of persistent bitcoin price uptick or price increase.
This period can be quite deceptive and tempting, it gives hope to people that the price will continue to increase.
Then FOMO (Fear Of Missing Out) sets in and people jump on the trend without proper analysis of the chart.
The downside of this is that the market can dip within a short period of you investing in it and plummet to an unexpected level.
It is true that cryptocurrency is risky but not about taking an uncalculated risk.
The second is the Bear Period.
It is a period when the price of bitcoin begins to dip or plummet.
The psychology behind a bearish move is that once Bitcoin price starts going down, it will keep going because of the fear that develops in the mind of the people.
They don’t want to lose their money, so they sell out of fear.
In practice, people are always waiting for the bear period because they know it will go back up and of course, they want to buy low and sell high as the basic rule of investment states.
What are the Determinants That Cause Bullish or Bearish Trends?
1. Big Countries
The very first factor is big countries like China.
Over 70% of bitcoin users are in China.
The moment a favorable policy is passed in China on the use of bitcoin, the adoption will increase and the number of people that will buy bitcoin will increase.
This will invariably increase the demand and will cause a bullish trend and vice versa.
Another country that equally affects the price of bitcoin is Russia. There is also a massive rate of bitcoin adoption in Russia.
2. Mass Media
Another major factor that can induce a bullish or a bearish trend is the Mass Media.
The media can induce fear, uncertainty, and doubt in the mind of enthusiasts and make them sell all their bitcoin causing a huge dump in its price.
The media can also put optimism in the mind of people and make them buy BTC massively also causing an increase in demand and a rise in the price.
3. Celebrities Adoption
Celebrities adoption can also influence Bitcoin price.
Once a notable celebrity buys bitcoin, people will feel comfortable around it because they feel the celebrity won’t buy something that isn’t safe.
So celebrity adoption can cause a bullish trend and celebrities talking bad of bitcoin can cause a bearish trend.
A typical example is Elon Musk, the second richest man in the world who recently added the word ‘Bitcoin’ to his Twitter bio.
This single action caused the price of BTC to gain a 14% increase.
4. Technological and Security Advancements
Technological and security advancements can increase adoption and increase demand.
Once a new technological feature is added to the security, people will be more comfortable with it and buy more therefore causing a bullish trend.
Also, when there is a security breach, hack or scam, people withdraw their funds massively which can cause a downward trend.
5. Government Regulation
The last and one of the most important factors is ‘government regulation’. This can equally cause a bullish and a bearish trend.
When the government allows easy use and adoption of bitcoin and also passes a favorable regulation the price increases.
But when the regulations are not favorable, it can cause the price to decrease.
Now that you have an idea of what factors could cause Bitcoin price to either increase or decrease, the question that will probably be on your mind is – ‘when is the best time to buy bitcoin in Nigeria?
When Should You Buy Bitcoin?
The most honest answer to the question of when you should buy bitcoin is that you can buy it NOW contrary to what people will tell you that you should wait till after a bearish trend.
The problem with that answer is that you never know when there will be a dump.
Experts only give their opinions on whether the price will fall or rise after examining the Bitcoin trend chart, and happenings from the past are used to predict the future outcome.
However, we advise that whenever you want to buy bitcoin in Nigeria, don’t buy it when the price is not stable, that is, don’t buy it when the price is still in motion whether it is going up or coming down, wait till it stabilizes.
Have a structured plan and strategy, have a target, state the price you are willing to sell, and wait till it gets to your preferred price no matter how long it might take.
Don’t give in to FOMO or FUD.
Stop checking the price from time to time because doing so can influence your judgment and cause you to make mistakes.