Introduction: the importance of your behaviour during a bullrun

The crypto-currency market periodically goes through phases of euphoria known as bullruns, during which investors are faced with large potential gains. Despite the current enthusiasm, it is important to note that we are not currently in a euphoric phase. It's true that Bitcoin has rallied significantly, but the bullrun 'climax' is not yet upon us. We would like to draw your attention to the importance of preparing a strategic plan to manage these periods of opportunity effectively and enable you to emerge a winner after more than 2 years of bear market.

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Investor psychology during a bullrun

Psychology plays a crucial role in investment decisions, especially during a bullrun. Euphoria can quickly take over, where the fear of missing an opportunity (FOMO - Fear Of Missing Out) pushes investors to enter the market without any prior strategy. This euphoria is often followed by greed, where investors, seeing their gains increase, hesitate to sell in the hope of even greater gains, often ignoring signs of overbought conditions or warnings of an imminent correction.

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Common mistakes to avoid

Bullruns can lead to typical investment mistakes:

• Over-investment: investing more than you can afford to lose, lured by the promise of quick gains.
• Lack of diversification: putting all your eggs in one basket without considering the volatility inherent in the cryptocurrency market.
• Ignoring market signals: not paying attention to technical or fundamental indicators that signal a possible trend reversal.
• FOMO: entering the market too late by buying at the top in the hope that prices will continue to rise indefinitely.

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Strategies for securing profits

• Set clear profit-taking targets before investing to secure gains systematically.
• Use stop-loss and take-profit orders to manage risk and secure gains automatically.
• Diversify investments to minimise the risks associated with the volatility of a single market.
• Regularly monitor and re-evaluate investments to adapt to rapid market changes.

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Essential profit-taking techniques

The article suggests several techniques for securing profits during a Bullrun, including :

1. Progressive profit-taking strategy (DCA out): This method involves taking periodic profits by selling a portion of one's crypto assets at defined intervals. The advantage is that you can gradually secure your gains while remaining partially invested to benefit from any subsequent rises. This is particularly suitable when profits reach a level that is deemed satisfactory. For example, selling a given percentage of your assets each week during a period of strong growth.
2. Taking profits by performance levels: This variant involves defining in advance financial performance thresholds at which to withdraw part of the investment. For example, withdrawing $1,000 for each $5,000 gain on an investment. The thresholds can be customised according to the investor's analysis and objectives.
3. Withdrawing the initial investment: To minimise risk, one strategy is to withdraw the initial amount invested as soon as this is feasible. This approach is particularly relevant for high-volatility cryptocurrencies, but can be applied to any type of cryptoasset. This makes it possible to invest later with greater peace of mind, knowing that the initial capital is secure.
4. Exploiting bull runs: During periods of strong growth (bullrun), some assets can experience significant increases in value before stabilising. Withdrawing a portion of your assets in proportion to the increase (for example, a 15% withdrawal if assets rise by 15%) can be a judicious strategy for capitalising on these fluctuations without completely withdrawing from the market.
5. All Out strategy: Consists of selling all of one's cryptoassets in a single transaction. This radical method can be considered in situations of high uncertainty or when you anticipate an imminent market downturn. It offers a complete exit, realising all the gains accumulated up to that point.
6. Keeping a Moonbag: Some crypto assets have the potential to generate exceptionally high returns on investment. In this case, it may be tempting to hold on to a small portion of these assets (the "Moonbag") in the hope of a spectacular rise. However, this strategy involves significant risks and requires in-depth analysis (DYOR - Do Your Own Research) before committing to it.

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Conclusion: keep your feet on the ground

Navigating a bullrun successfully requires more than just a willingness to participate in the market; it requires meticulous preparation, iron discipline and a well-defined strategy. By avoiding the common pitfalls of impulsive investing and adopting a measured approach to securing gains, investors can not only survive the volatility of a bullrun but also emerge with substantial profits. The key is to stay informed, be realistic about your financial goals, and never let greed or fear dictate your investment decisions.

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In an upcoming Summit Research live session, we will go beyond this general advice by presenting specific technical indicators that will allow you to apply the techniques mentioned above in concrete terms. This exclusive session will provide an invaluable opportunity to understand the tools and strategies used by professionals to maximise their chances of success during these periods of strong market growth. By equipping yourself with these indicators, you will be better prepared to identify opportunities, manage risk effectively, and make informed investment decisions.